`
Report
The Central American Free Trade Agreement:
Gender Perspectives and Women’s Action
By Veronica Campanile
May 2004
Commissioned by
The Central American Women’s Network
Report / The Central America Free Trade Agreement: Gender Issues and Women’s Action
Contents
Abbreviations…………………………………………………………………………………………..3
Introduction……………………………………………………………………………………………..4
Arriving at CAFTA………………………………………………………………………………………4
Background and basic facts ............................................................................................... 4
Chronology of the negotiating process ............................................................................... 5
Critiques of the negotiating process…………………………………………………………….6
Ratification and entry into force…………………………………………………………………7
Gendered Critiques of CAFTA ................................................................................................... 7
Labour Rights ..................................................................................................................... 8
Agriculture .......................................................................................................................... 9
Services ............................................................................................................................ 10
Intellectual Property Rights .............................................................................................. 10
Investment ........................................................................................................................ 11
CAFTA within the FTAA and the WTO processes .................................................................. 11
The collapse of the WTO negotiations in Cancun ............................................................ 11
US policy in Latin America post Cancun .......................................................................... 12
Endnote on the WTO and the FTAA ................................................................................ 12
The European Union in Latin America..................................................................................... 13
EU Global Agreements ..................................................................................................... 13
The E.U. Global Agreement with Central America ........................................................... 13
Women’s Action on CAFTA in Central and North America ..................................................... 15
Work in the UK and Europe on CAFTA…………………………………………………………….19
Bibliography ............................................................................................................................. 21
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…….
Abbreviations
AFL-CIO
CAFTA
CIFCA
E.U.
FTAA
GATT
GEM
IPR
ITGN
MEC
NAFTA
REDGE
REMTE
RMALC
TIR
UNDP
U.S.
USTR
WIDE
WTO
WOLA
The US Trade Union Federation
Central American Free Trade Agreement
Copenhagen Initiative for Central America and Mexico
European Union
Free Trade Agreement of the Americas
General Agreement on Trade and Tariffs
Grupo Empresarial de Mujeres
Women’s Business Group
Intellectual Property Rights
The International Trade and Gender Network
Movimiento de Mujeres Maria Elena Cuadra
Maria Elena Cuadra Women’s Movement
North American Free Trade Agreement
Red de Genero y Economia
Gender and Economy Network
Red de Mujeres para la Transformacion de la Economia
Women’s Network for the transformation of the Economy
Red Mexicano de Acción sobre Libre Comercio
Mexican Network for Action on Free Trade
Trade and Investment Review
United Nations Development Programme
United States
United States’ Trade Representative
Women in Development Europe
World Trade Organisation
Washington Office on Latin America
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Report / The Central America Free Trade Agreement: Gender Issues and Women’s Action
Introduction
This report was commissioned by the Central American Women’s Network as a short Scoping
Study of the Central American Free Trade Agreement covering the following areas:
1. The overall CAFTA process
2. The work of Central American women’s organisations around CAFTA, their positions
and opportunities for joint work and research
3. The work of development agencies and solidarity organisations and networks around
CAFTA in the United Kingdom
4. The implications of processes in Mexico including the European Union’s global
agreement
The study was carried out in August and September 2003, and updated in 2004. The sources
used were documents and articles mainly obtained through the Internet; a short email
questionnaire for Central American and European contacts and some telephone interviews
with UK organisations.
Arriving at CAFTA
Background and basic facts
The Central American Free Trade Agreement (CAFTA) is a trade and investment agreement
initially between the United States (U.S.) and five Central American countries (El Salvador,
Guatemala, Honduras, Nicaragua and Costa Rica) with the imminent addition of the
Dominican Republic1. The draft CAFTA text was signed in 2003 and the final version was
signed on 28 May 2004. 2
Central America’s principal trading partner is the United States. In 2003, 43% of Central
American exports were destined for the U.S. and a further 30% for within the Central
American region (the second most important market), accounting for a total of 73% of exports.
The U.S. is also the region’s main source of imports.
Whilst Central America is not important in terms of United States global economic interests,
once the Dominican Republic joins CAFTA, the area will become the second largest export
market for the U.S. in Latin America, behind only Mexico. 3
CAFTA is key to the conclusion of other processes which are important for multinational
corporate interests (principally based in the U.S.). For example, CAFTA will create the legal
and economic framework necessary for guaranteeing the conclusion of the Plan Puebla
Panama, a ten year ‘development’ plan primarily aimed at creating the industrial infrastructure
throughout the region needed to facilitate the movement of capital and goods.
The content of CAFTA is closely modelled on the North American Free Trade Agreement
(NAFTA) between the U.S., Canada and Mexico, and the bilateral U.S.-Chile Trade
Agreement. Interestingly, CAFTA appears to be open ended. The draft text does not stipulate
the duration of the agreement, stating only that any country can withdraw at any time via
written notice of withdrawal to all other parties with effect six months later (USTR: Draft
CAFTA, 28/01/2004).
1
CAFTA includes a docking procedure which permits other countries to join, but without
amendments to the text. Thus, negotiations began with the Dominican Republic in January
and were due for completion in three months, with an additional period for the docking
process. Panama may join at a later date. (IGTN Bulletin, Vol.3.No.4:p.11 and Vol 4. No 1).
2
Office of the USTR, Press Release 28 May 2004
3 Office of the USTR, Press Release, 25/01/04.
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Seen in a wider context, CAFTA is the first regional agreement in Latin America. CAFTA
together with its precursor NAFTA are important stepping stones in creating the Free Trade
Agreement of the Americas (FTAA) covering the whole continent with the exception of Cuba.
The FTAA is scheduled for completion in 2005 and is of paramount importance to the U.S. as
one of the main solutions to U.S. economic problems4 .
Chronology of negotiations
1999:
Jan. 2002:
Mar-May
2004
Onset of Presidential level talks on drawing up CAFTA.
The CAFTA process becomes official when President Bush made known his
intentions on reaching this agreement to the U.S. and to the Organisation of
American States. 5
U.S. Congress and Senate authorise ‘fast-track’ provisions for drawing up
CAFTA to enable completion in one year. The time scale for CAFTA is a stark
contrast to the seven years for NAFTA6 and ten years for the FTAA!
Series of presidential level meetings sets the framework for CAFTA.
Negotiation of the CAFTA text officially begins on 8 January 2003 with a
Ministerial level meeting in the U.S., followed by nine coordinating meetings,
and nine rounds of negotiations held in rotation in the participant countries
with the final two in the U.S.
Negotiations conclude as per the fast track schedule, and the draft CAFTA
text is signed on 17 December, 2003 by the U.S. four Central American
countries (Nicaragua, El Salvador, Guatemala and Honduras) with the
exception of Costa Rica. Costa Rican negotiators walked out over unresolved
sensitive issues for the telecommunications and insurance sectors and
various agriculture and textile goods 7.
After two intense rounds of negotiation Costa Rica signs up for CAFTA on 25
January 2004
Each country has until March to finalise issues, for example, the list of areas
in which they wish to exclude foreign competition within the service sectors
they have agreed to liberalise, otherwise they lose the opportunity of
exclusion.
Process of legal determination of whether commitments made in CAFTA are
consistent with the member countries’ respective laws and Constitutions.
28 May 2004
The final CAFTA was signed on 28 May 2004.
Aug. 2002
2002
8 Jan. 2003:
17 Dec.2003
25 Jan. 2004
Mar. 2004:
Portillo’s article outlines essential parallel processes to the FTAA such as the creation of
hemispheric infrastructure (transport, telecommunications, etc.) to facilitate the circulation of
goods and services via regional projects (the Plan Puebla Panama and Integracion de la
Infraestructura Regional Suramericana), together with a continental wide U.S. military
programme via Joint Agreements with each country resulting in a network of U.S. military
bases (considered essential after the handover of the Panama Canal).
5
State of the Nation address to Congress
6 This time scale allowed participants time to debate and negotiate their requirements.
7 According to the USTR press release the US and Costa Rica resolved outstanding issues in
market access for agriculture, textile and apparel, and professional services. Costa Rica
made specific commitments to gradually open its telecommunications market in three areas –
private network services, Internet services and wireless services and committed to
establishing a regulatory framework to help foster effective market access. Costa Rica also
committed to fully open its insurance market to competition with the vast majority of the
market opening by January 2008 and the remainder by January 2011(USTR, January 2004).
4
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Critiques of the process
The CAFTA process has been highly criticised by civil society groups and networks from all
participant countries (IGTN Facts Sheet 2, n.d.), and unofficially from some members of the
Nicaraguan national negotiating team during their presentation to the Women and Economy
Working group (Mesa de Mujeres y Economia, July 2003). This section presents the key
critiques of the process:

The Fast-track provision gives a distinct advantage to the U.S.: The U.S. government
has accrued considerable experience in drawing up trade agreements, including:
NAFTA, the ongoing FTAA process, and scores of bilateral agreements around the
world. In addition the US is highly resourced, compared to the Central American
countries8.By the second month of official negotiations the U.S. had submitted
proposals on 85% of the agreement, every area except agriculture, labour and
telecommunications.
In contrast, the Central American negotiating teams had serious limitations: a) They
were much less experienced with fewer and less skilled personnel than their U.S.
counterparts (training was offered as for the WTO process, however, this was thought
to be biased towards US interests), b) The timescale left limited opportunities to
research and consult at home on particular conditions (key goods, services, labour,
etc.) in order to prepare the agenda points for negotiation, and, c) They also had
responsibility for simultaneous negotiating processes of additional agreements in the
Americas and at the World Trade Organisation (WTO).

The absolute secrecy of negotiations: CAFTA country governments agreed that the
negotiating texts would not be released as they would be classified as part of national
security. The US demanded that all parties sign a confidentiality agreement, thus the
negotiators could neither reveal the agenda of meetings nor which agreements were
reached, unless there was unanimous consent from all participant countries
(effectively a one country veto). During the rounds, negotiators could not even divulge
information to accredited civil society representatives who participated in an ‘adjoining
room’ facility’ set up specifically to give them a chance to consult.
Indeed the final text of CAFTA was only released in both Spanish and English in late
January 2004, one month after signing. In contrast, in the course of the decade long
FTAA process, issues on the table have been publicised and three drafts have been
released in four languages

Broad social movements in Central America and the United States had almost no
meaningful voice in the negotiations. Despite an official discourse of participation,
including official and unofficial seminars and meetings between national negotiating
teams and civil society, it remained unclear how civil society groups were identified to
participate in these events and what was considered meaningful dialogue. None of
the countries established an effective mechanism to respond to civil society
groupings. Between the speed of negotiations and the lack of political will it was
extremely difficult for civil society, including small and medium businesses to
participate in the process, even if they wanted to. This has made it virtually
impossible to make adequate comment, assessment or changes to the US proposal.
(IGTN Facts Sheet 2).
With the deficiency of the consultation process some groups decided not to
participate to avoid being manipulated9 As a result, social movements split into two
camps; those that opted to participate in the process in the hope of having some
8 See the USTR website which details the stream of bi and multilateral trade agreements
under negotiation and already completed!
9
Alerta 3 & 31, Costa Rica.
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influence; and those who chose to remain outside the process, indirect opposition to
CAFTA.
Consequently, the specific needs and interests of particular groups of the population
– including women, indigenous peoples, small business, workers in low-skill jobs, etc.
– which make up the majority of the Central American population have not been
assessed. As a result, it is highly improbable that the agreement can respond to their
needs and it is likely to be detrimental to them.
Ratification and Entry into Force
Post signing, CAFTA will be sent for Ratification by the Legislatures of each signatory
country10 CAFTA “Enters into Force” following the exchange of written notification of
completion of the necessary domestic legal procedures by the U.S. and at least one other
signatory on any date they agree. Entry into Force for other countries will be 90 days after
written submission of the completion of the necessary domestic legal procedures. 11
Due to the fast-track legislation once CAFTA has been introduced, the U.S. Congress has a
very limited period to debate it (the literature quotes two different time limits - 60 and 90 days)
and can only vote ‘for or against’ as amendments are not permitted.
The Chief US Negotiator for CAFTA confirmed on May 28th that the treaty will not be
presented to the U.S. Congress until after the presidential elections in November 2004. It is
likely that the majority would vote against CAFTA in the US Congress as it stands. The
democrat presidential candidate Kerry has made it clear if he was elected that his government
would re-negotiate CAFTA ..12
With the collapse of the World Trade Organisation (WTO) Ministerial Meeting in September
2003 and the failure of the U.S. to push through a single undertaking FTAA in November’s
ministerial meeting in Miami, the U.S. Administration is hungry for a win in the area of free
trade. To achieve this win, the USTR is trying to win over representatives of the U.S. sugar
and textile industries who strongly oppose CAFTA in order to solidify support in Congress13
In the U.S., it seems there is a considerable anti-CAFTA lobby bringing together many Trade
Unions and small and medium farmers, and in addition the fore mentioned sugar and textile
industries. Combined, they muster considerable congressional backing14 .
In Central America, there has been heavy lobbying against the ratification of CAFTA
particularly from the group of 22 trade unions participating in the Central American Common
Union Platform and in Costa Rica where opposition has been strong. In addition, a network of
women’s organisations launched a “ Women Say NO to CAFTA” lobby directed at getting
members of Congress in the U.S. and Central America to vote No to CAFTA – see Appendix
1.
Gendered Critiques of CAFTA
This section presents a gendered critique of the five main contentious issues in CAFTA which
are: Labour rights; Agriculture; Services; Intellectual Property Rights and Investment. As the
final text was only made available in January 2004 and analysts are only beginning to study
10
IGTN Vol. 4.No1.
USTR: Draft CAFTA, 28/01/2004.
12
US-Central America duty-free agreement delayed until after November elections, May 28th,
www.emergingtextiles.com
13
IGTN Vol 4. No.1.
14
Nicaragua News Service, Vol. 12, No 5, January 26-February 1 2004, and IGTN Vol 3, No
9.
11
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the implications, only the first sub-section on labour rights presents a post publication
analysis. The remaining subsections present more general assessments which have been
based on assessment of the impact of NAFTA and deficiencies in other international trade
and investment agreements.
Labour Rights
The labour issues section of CAFTA opens by reaffirming "the commitments assumed in
virtue of the Declaration of the International Labour Organization (ILO) with relation to the
Principles and Fundamental Rights regarding Labour." This declaration obliges all member
countries of the ILO to "promote and make real the elimination of discrimination relating to
employment and occupation." Further on the text states it is based on the ILO’s Fundamental
Principles on Rights at Work and its Follow up (1998).
However, the document fails to address labour standards or gender issues and discrimination
in a meaningful way, for example:
a) The list of rights (proposed by the U.S. government) is outdated and does not recognise or
address women’s specific rights in the workplace, a serious omission when the vast majority
of Maquila and service sector workers are women, and when women have fought for years
worldwide precisely for the recognition of their specific problems. Nor does CAFTA provide
concrete mechanisms to guarantee that ratifying countries respect the rights of women, and
because of this, seems little more than a declaration of good intentions 15.
b) The reference to ILO Core Conventions is pro forma and there are no provisions for
monitoring, reporting or enforcement. Compliance with labour standards is not a central
feature, and related to this other key features are absent such as independent monitoring of
compliance (by the ILO or other body) and transparent reporting on compliance and progress
toward compliance. These features have been tested in the Cambodia Textile agreement
which is considered a better example of a trade agreement (though still with significant
weaknesses)16.
c) The accord envisages a maximum fine of US$15 million against any country that fails to
apply its CAFTA "labour code". This labour code defines the rules relating to: the right of
association; collective bargaining; acceptable working conditions, and the outlawing of forced
labour and the worst forms of child labour. It fails to include the right not to face gender
discrimination. Thus any government which fails to meet its obligations, and permits the
abuse of specific women workers’ rights, will not risk sanctions, allowing the widespread
problems of discrimination against pregnant women, gendered workplace violence and sexual
harassment to continue unimpeded. In fact, no specific protection, increased internal and
external migration, employment in the export processing zones and sexual tourism, CAFTA
will probably contribute to an increase in abuse and exploitation of women workers.
d) Although the treaty claims it will promote "robust protections for labour rights" and sets
aside US$6.7 million for "improving members' legislation, this will only be helpful where there
is political will in ensuring the practical application of the law. In fact, given the general
weakness of labour codes throughout the Central American countries and the historical lack
of respect for these codes17, it is unlikely that labour laws will improve or be effectively
enforced under CAFTA.18
While the provision to promote robust protections for labour rights and the accompanying fund
may provide opportunities for continued lobbying from the labour movement and for improving
national labour codes, this also may represent a threat, as it is also possible for governments
to make changes and increase forms of “flexibility” detrimental to labour rights in existing
labour legislation, a concern already posed by the Costa Rican labour movement. If gender
15
16
17
18
Human Rights Watch in, Nicaragua News Service, Vol. 12, No 5, 2004
Jeffcott, Bob, Maquila Solidarity Network 2004
AFL-CIO 2002
Human Rights Watch in, Nicaragua News Service, Vol. 12, No 5, 2004.
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and other specific rights are not present in the CAFTA text, the capacity for advocacy on
women’s labour rights could be seriously curtailed.
Agriculture
Agriculture has been one of the most contentious issues in CAFTA and as expected
considerable tensions prevailed during the negotiations, and differences were only resolved at
the very end. The main issues in agriculture are:
1) Protectionist measures for agriculture, particularly the exemption of key products/industries
requested by the Central American countries, and inequalities in the extension of state
subsidies for farming. The US has fiercely resisted the exclusion of any products from the
agreement and pushed for the elimination of state subsidies in other countries whilst retaining
its own, particularly its internal subsidies on milk, tuna, sardines rubber packing, sugar, pork,
beef, etc., some of the very products Central America wants to trade freely.
2) Loss of food security, and rural livelihoods in Central America due to the promotion of
crops for export rather than for local consumption and the destruction of local food production
by cheaper subsidised imports.
3) Much higher benefits for large corporate farms than for family farms in the United States
through the provision of export credits. In the US this has already resulted in some loss of
rural livelihoods and women farmers taking on additional off farm income generating
activities19
Based on the experience of Mexico in NAFTA (the only developing country), the result for
Central America is likely to be cheaper imported food swamping local markets which is
probably destroy small and medium scale farms and rural livelihoods in general. As people
are forced to move from agricultural to urban environments in search of a livelihood, rural
women with limited skills and resources will be forced to seek paid work in the few areas
which are available to them, these include:
1. The only formal sector employment alternative is the Maquila or export processing sector
(primarily textiles but also foodstuffs and flowers) which has experienced rapid growth
over the last decade. Maquilas are known for poor working conditions, lack of respect for
labour laws, exploitative work environments and sexual harassment. Across Central
America 80-90% of Maquila workers are female.
2. The other two employment alternatives are domestic service or prostitution, both in the
informal sector which are low paid, unregulated, and in the case of prostitution may
mean contravening the law.
3. The last alternative is migration to other countries, principally Costa Rica or the U.S.
which is another feature of this rural-urban shift. Both female and male migration has a
significant negative impact on women and their families, particularly in terms of emotional
well being. Women are increasingly leaving their families and homes to work abroad,
principally as domestic or Maquila workers and generally children are left in the care of
the extended family. With male migration, women take on an even greater share of the
family and community burden often on a permanent basis as men frequently establish
new families and cease support for their previous partner and children.
In each of the above alternatives women already have few rights and benefits and this
situation is likely to worsen under CAFTA. In addition, this rapid shift from living in small
19 The number of farms in the US dropped from 7 million to 2.6 million of which 170,000
account for 68% of production (the timescale is unclear but is probably between the 1995
Freedom to Farm Bill and the 2002 revised Farm Bill). More than 72,000 family farms
disappeared in the US between 1992 and 1999(Trade in Agriculture: The market vs
sustainable livelihoods, Breaking Boundaries II, 2004).
.
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agricultural communities, often on family based units, to urban settings (at home or abroad)
has extreme impacts on the women themselves, their families, communities and cultures.
The probable loss of food security is a central issue for both rural and urban women as the
producers, processors, distributors, providers and consumers responsible for household food
security. The loss of food security and consequent dependency on imports may provoke
periods of scarcity and price fluctuations which will inevitably heighten the stress on women in
their roles as providers and consumers.20
Services
In Central America, social movements have focussed on preventing the privatisation of
essential public services. Under CAFTA, all services will be opened up for trade liberalisation
and privatisation. Public services as well as other essential low cost services may no longer
be accessible or affordable to those most in need, especially women. Privatisation will also
threaten the job security of public service workers.
Women are the primary service providers in the household, the community and in the market.
When people cannot access essential services (education, health, clean water) - because
they are not available or affordable - women often provide these services for their families.
This results in extreme stress on women and endangers the health of entire communities and
the opportunities of future generations.
Public sector services are mostly female areas of employment and for many women these are
also the most secure available jobs and offer the most benefits, including healthcare. Under
CAFTA public services could be subject to competition, privatisation and flexibilisation and
therefore jobs in this sector could become less secure, which in turn would force women into
other sectors of the economy21
Intellectual Property Rights
The US has asked for a 25-30 year protection period for IPRs (Intellectual Property Rights)
under CAFTA, a considerable extension of the 20 year period offered by the WTO. CAFTA’s
IPR rules limit compulsory licensing of CAFTA countries and could also severely limit the
importing abilities of these countries. In particular, it could become difficult for Central
American governments to obtain cheaper drugs to meet public health needs.
Pharmaceutical and genetic-research corporations are particularly interested in this area in
CAFTA because of the rich bio-diversity of the region. They plan to harvest plants and micro
organisms and patent them as new discoveries. This will give them the legal right to profit
from plants, medicines and techniques which have been in local use for centuries.
These new IPR laws have been criticised as encouraging and institutionalising bio-piracy and
making acceptable the theft of genetic resources, which in turn threatens the survival of
traditional ways of life often in the care of women and indigenous communities
As the primary providers of health care within families and communities, women will bear
severe burdens under CAFTA IPR laws. Cheaper drugs would be of benefit to citizens and
particularly to the poorer sectors of the population, often women. One study revealed that
CAFTA IP measures will increase the cost of medicines by 800% in Costa Rica alone.
Existing WTO IP laws involve cumbersome administrative and legal processes which
discourage local research and patenting by people with limited resources, especially women
and indigenous peoples. Thus it is extremely difficult for local people with limited resources to
patent their inventions or knowledge in the areas of music, folklore, handicrafts, traditional
20
Center of Concern/IGTN, 2003: Gender Impacts of CAFTA.
21
Center of Concern/IGTN: Gender Impacts of CAFTA 2003.
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medicines and other creative outputs. Women are often the keepers of this traditional
knowledge and often make an income form the sale of handicrafts or use traditional
medicines at home and in the community. Women’s legal right to this knowledge and
resources are in jeopardy under the new IP laws22
Investment
The U.S. has been pushing the Central American governments to further liberalise their
investment rules and increase investor rights under CAFTA in order to attract more Foreign
Direct Investment (FDI). This focus is on the quantity rather than the quality of investment,
and reduces the regulatory capacity of the region’s governments and gives them less say
over whether the kind of foreign investment is compatible with the needs of the people and
national development goals, e.g. expansion of Maquila type production with scarce linkage to
local business23
CAFTA was expected to closely track the trade and investment provisions of the US-Chile
FTA with the same “investor-state” mechanism as NAFTA. This mechanism allows foreign
investors to legally demand compensation for laws that threaten their potential profits.
(Approximately 27 law suits have been brought under NAFTA many of which challenged local
health and environmental laws).
Despite Congressional instructions to US negotiators, the language in the US-Chile
agreement gives foreign investors greater rights than local investors, including the right to
bypass local judicial systems to demand compensation under conditions that would never be
allowed for domestic investors.
Investment laws currently in free trade agreements undermine the right of governments to
empower local investors, including women investors, who cannot compete on an equal
footing with foreign investors.
These investment laws undermine government’s rights to effectively regulate foreign
investment. Foreign direct investment in export processing and industrial zones where women
are primarily employed, often leads to appalling labour conditions that differentially impact
women than men as this investment is outside national labour control. 24
CAFTA within the FTAA and the WTO processes
The collapse of the WTO negotiations in Cancun
The multilateral context has a significant impact on the FTAA and indeed CAFTA. Conversely,
CAFTA is significant for both the FTAA and the WTO as it sets a precedent for Latin America
and the Caribbean, which will also have implications for similar processes worldwide.
In September 2003, the WTO negotiations in Cancun, Mexico collapsed, and have still not
regained momentum. This section outlines the reasons for the collapse of the WTO process
and their significance for free trade processes in Latin American:
22
ibid
Performance Requirements were eliminated with NAFTA and their effective prohibition
means that governments cannot mandate that an investor buys a certain percentage of raw
materials locally which was a common government tool for stimulating small business (see
experience on the northern border area of Mexico where 98% of inputs are imported). This is
particularly detrimental to small and micro-enterprises where women are highly represented.
(Investment and the FTAA – Can Women Benefit, in Breaking Barriers II, 2004)
24
Facts Sheets on U.S. Trade Policymaking, Facts Sheet #2, Centre of Concern/USGTN
23
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In the area of Agriculture: The G21+ (led by Brazil, India, South Africa and China) stood up to
US and EU trade policies and stated that it would not move ahead on agriculture negotiations
until the EU and the US had incorporated specific language and timelines to eliminate their
domestic agricultural subsidies. Since Cancun, despite US pressure and the subsequent
withdrawal of some countries, the G21+ has maintained itself as a political entity because
Agriculture is also one of the most contentious negotiating areas of the FTAA. Given that
over half the countries that allied themselves with the G21+ are from Latin America they could
stall negotiations at the regional level.
Including Food Security within Agriculture: A new grouping - the Alliance of Special
Safeguard Measures and Strategic Products - was formed in Cancun. This grouping included
Lesser Developed Countries which advocated food security mechanisms to be central to any
negotiations on agriculture. Twenty of the countries in this alliance (the majority) were from
the Americas region, mostly form the Caribbean.
Investment, transparency in government procurement and trade facilitations: The African,
Caribbean and Pacific countries the African Union and the Lesser Developed Countries
refused to negotiate on the Singapore Issues (investment, transparency in government
procurement and trade facilitations). Although over 70 countries backed this position the WTO
Secretariat produced a draft text which would have effectively launched negotiations on the
Singapore issues and also offered no real changes in the area of Agriculture. The Singapore
issues have been part of the FTAA negotiations since 1998 when topical groups were set up.
Negotiations on government procurement and investment are well underway, and investment
is the most contentious and heavily bracketed section.25
US policy in Latin America post Cancun
Instead of assessing the multilateral context in order to try to understand the critiques coming
from many of the countries in the Americas, the US Trade representative (USTR) Robert
Zoellick summed up the US position on the collapse of the Cancun round with this statement:
“The key division at Cancun was between the can-do and the won’t-do. For over two years
the US has pushed to open markets globally, in our hemisphere, and with sub-regions or
individual counties. As WTO members ponder the future, the US will not wait: we will move
towards free trade with can-do countries”.
Thus within what it calls “a strategy of competitive liberalization” the US has been devoting its
energy to the completion of the FTAA and CAFTA and bilateral agreements with “can-do”
countries in the region.
In this vein shortly after Cancun, the USTR travelled round the Americas to “visit” those
countries that had supported the G21+ and let it be understood that continued support would
negatively impact trade relations and bilateral aid.
Subsequently, Colombia, Costa Rica, Guatemala, Peru and Nicaragua pulled out of the
G21+, and shortly after CAFTA was signed with a text that accommodates all of the
contentious issues. 26
Thus CAFTA has set a precedent for the rest of the region, and has effectively shown the
WTO process to be of little relevance for the Americas.
Endnote on the WTO and the FTAA
The WTO process has continued to move at a very slow pace with very low participation from
its main drivers, the developed countries. Most delegates and trade negotiators anticipate that
25
26
(IGTN, Vol 3 No.8, Oct-Nov, 2003).
ibid
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the pace may quicken in 2004 but possibly not until 2005 after the US Presidential Elections
and after the appointment of a new trade commissioner for the EU.
Brazil and Argentina, leaders of MERCOSUR have proposed an FTAA “lite” which would be
more flexible in the conditions of entry, and where main (contentious) issues such as
investment and government procurement would be negotiated at the WTO level. In contrast,
the United States maintains its position of achieving an all embracing FTAA which deals with
all issues.
Linked to these divergent positions on the FTAA, in the January meeting of the Summit of the
Americas in Monterrey, Mexico, key players such as Brazil, Argentina and Venezuela insisted
that poverty and sustainable development be at the core of any Summit agenda, whereas the
US wanted to prioritise the fight against terrorism, confronting corruption and promoting
democracy through free trade and economic growth. 27
The European Union in Latin America
Both the European Union (E.U.) and the U.S. are developing policies designed to widen their
sphere of economic and political influence. On the one hand it is recognised that each of
these powers has accepted continental spheres of influence. however, at the same time they
are both involved in drawing up trade and investment agreements around the world including
these designated spheres of influence. This section briefly outlines developments in
European-Latin American relations and advocacy initiatives.
EU Global Agreements
For some years the E.U. has been pressing on with the negotiation of “Global Agreements”
with Mexico, Central America and MERCOSUR in South America. These Global Agreements
ostensibly bring together cooperation for development (political, institutional, technological
and scientific) and trade, although in practice the main emphasis is on trade.
So far, advocacy within the E.U. has been constrained by the lack of accountability,
transparency or democracy in EU trade negotiations and agreements. European trade policy
is decided behind closed doors by Committee 133. The European Parliament neither has the
right to co-decision on trade matters nor the right to observe Committee 133 meetings. The
Business Community has had some success in getting their views across to Committee 133,
but not so the rest of civil society.
In terms of applying a gender analysis to trade issues, whilst the E.U. has committed itself to
making trade sustainable and is applying Sustainability Impact Assessments to major trade
negotiations, these do not as yet include a gender dimension. 28
The E.U. Global Agreement with Central America
The European Union and Central America are currently drafting a Global Agreement formally
known as “the New Agreement for Political Dialogue and Cooperation” which is scheduled for
completion in 2004/5. The New Agreement is based on a 1993 Framework Agreement, and
the 1996 Florence Declaration of the XII Ministerial Conference which set out the main areas
for European Cooperation with Central America: Consolidation of the Rule of Law; Support for
social policies; Promotion of the competitive insertion of Central America in the world
economy and Central American Integration29.
27
ibid
Karadenizili 2002
29 This current initiative revived the 1984 San Jose political dialogue between European Union
foreign affairs ministers and Central America counterparts which was set up to look for a
peaceful solution to the crisis in the region.
28
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The Copenhagen Initiative for Central America and Mexico (CIFCA )and Mexican Network for
Action on Free Trade (RMALC) – a Mexican organisation with considerable experience in
documenting the impact of NAFTA - have been promoting a social dialogue around the New
Agreement highlighting accountability issues around development and human rights (Email
Simon Ticehurst, Oxfam’s Representative in Mexico, Sept 2003). They have criticised the
process of the New Agreement on the following grounds:

Negotiation of the New Agreement is not based on key precedents, such as: an
evaluation of the successes and failures of previous agreements; issues from the San
Jose Agreement; the evaluation of the Framework Agreement; and the obstacles and
challenges set out in the E.U. 2002-2006 Strategic Document for Central America.

The Draft New Agreement leaves out key issues from the Framework Agreement,
such as: the vulnerability of the Central American Region; asymmetries between
regions; the favourability clause; and the focus on poverty (‘community cooperation is
an important element in the elimination of the problems of extreme poverty present
throughout the region’).

The process of Regional Integration includes no provision for ensuring the effective
participation of civil society, although the E.U. strategic document for the region
identified the absence of appropriate mechanisms for the participation of civil society
as one of the principal weaknesses of the Central American Integration process.

Consultation and participation have been fraught. In Europe the draft agreement has
been very difficult to access - CIFCA only obtained it in July 2003. Consultation in
Central America was envisaged but only within existing institutional forums in each
country, which would effectively exclude much of civil society and in particular ethnic
and women’s movements. According to one declaration, consultation is planned once
the agreement is signed! 30
Whilst it is beyond the scope of this report to cover the E.U. relationship with the whole of
Latin America the following points may be useful for future work on CAFTA.
a) Women in Development Europe (WIIDE) and a group of Latin American organisations are
involved in the trans-national project “A gender perspective in trade practice and policies of
the E.U. and Latin America”31, which has looked into E.U. agreements and trade policy with
Mexico and MERCOSUR. Central America has not been included in this project. The project
now has considerable experience in advocacy with the E.U. and Latin American governments
and has produced a series of publications including gender tools for measuring the impact of
trade agreements on women and gender relations32.
30
CIFCA, Sept 2003
The project objectives are:
- contribute to the mainstreaming of gender into EU-Latin America trade, cooperation
and association agreements and practice
- contribute to making bi-regional trade policy more just in terms of upholding women’s
human rights and equality between women and men and to gearing economic trade
activity towards overall sustainable human development and eradication of poverty in
Latin America
- promote processes that facilitate the participation of civil society and the incorporation
of its proposals in all phases of negotiation and implementation trade agreements ,a s
well as in the monitoring activities in order to reach an improved involvement of
women in the decision making processes
32 These are: Políticas comerciales e igualdad de género: El caso de los acuerdos UEMERCOSUR y UE-México; the Impact of Foreign Direct Investment on Gender Relations;
Gender and Trade Indicators; and Instruments for Gender Equality in Trade Agreements.
31
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b) The E.U. agreement with Mexico will be a blueprint for relations with Central America and
MERCOSUR hence advocacy at this stage will be important. It would also be worth following
the course of the E.U.-Latin America summit to be held in Guadalajara, Mexico, in May 2004.
Thus, the E.U. may try to take advantage of the difficulties the U.S. is facing with the FTAA
process to further strengthen its economic and political links with Latin America. Hence,
gender advocacy within the E.U. in conjunction with existing advocacy initiatives, may prove
to be worthwhile to further the interests of Central American women, and perhaps counterbalance the impact of CAFTA.
Women’s Action on CAFTA in Central and North
America
This section sets out the work of women’s networks and organisations in Central and North
America around CAFTA and related issues. In all of the cases, except for UNIFEM/UNDP, the
few responses obtained from my emails did not respond to my question. Thus much of the
information was gathered from web-sites or other interviews. As a result information is limited
on the possibilities for CAWN of joint working or on specific issues for research and advocacy.
Las Dignas/IGTN - Regional Initiative: A network of women’s organisations and social
movements from Central America and the United States led by Las Dignas of El Salvador and
IGTN of the Unites States, have joined together under the banner “Women Say No to
CAFTA”.
In March 2004 they began a campaign to lobby members of Congress of all participant
countries to reject CAFTA outright on the grounds that they have no powers to amend the
content of the agreement. Their letter and supporting document to Members of Congress
outline their support of fair-trade and sustainable development policies and their reasons for
opposing CAFTA (in brief, because CAFTA will be detrimental to sustainable development;
exacerbate poverty, particularly that of women and their families; and that the whole process
has been undemocratic). 33
It should be noted that in the first lobbying letter the following organisations and networks
were already signatories:
Country
Women’s organisations
Civil society orgs and networks
El Salvador
Las Dignas
CORAMS
The Melida Anaya Montes Women’s
The National Ecological Union of El
Movement (MAM)
Salvador
The World March of Women
CRIPDES,
The Women’s Development Institute
Fundacion Redes
Women’s Co-ordination ( Concertacion
de Mujeres)
Honduras
The Honduran Women’s Studies
Bloque Popular
Centre (CEM-H)
The Centre for Women’s Rights(CDM)
Guatemala
Tierra Viva
CNOC
Nicaragua
Women and Community (Mujer y
Comunidad)
Costa Rica
Costa Rican Women’s Alliance
Consejo de los 12 Puntos de Costa
Agenda Cantonal de Mujeres
Rica
Desamparadeñas
Mexico
Coordinadora Diocesana de Mujeres,
Women’s National Network of Gender
and the Economy (Red Nacional de
Genero y Economia)
US
US Gender and Trade Network,
AFL-CIO, Alliance for Responsible
33
IGTN/Las Dignas, March 2004.
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US
Canada
Women for Peace, STITCH, Women’s
Edge Coalition.
Trade, Center of Concern,
Development Group for Alternative
Policies, Ecumenical Programme for
Central America and the Caribbean,
, Mexico Solidarity Network,Global
Exchange, International Labour
Rights Fund, OFM Justice, Peace
and Integrity, Creation Council,Code
Pink
Maquila Solidarity Network
Women for Dignity and Life (Las Dignas) - El Salvador
Las Dignas run an Economic Justice for Women Programme which aims to show the
differential impact of economic policies on men and women, such as privatization,
flexibilisation at work, and in macro level projects such as CAFTA, the Plan Puebla-Panama
and the FTAA. Their position is one of opposition to free trade agreements. They also run an
important Campaign Programme which covers all of the above issues.. 34
Las Dignas’ have been very active on CAFTA issues particularly through national initiatives
challenging preparations for CAFTA. For example they have participated in broad based
coalitions opposing the privatisation of public services. Furthermore, they have participated in
REMTE activities and as a result organised training activities for women around the
implications of Free Trade Agreements . Currently Las Dignas are spearheading the Central
American and United States campaign “Women Say No to CAFTA” outlined above.
The Maria Elena Cuadra Women’s Movement (MEC) - Nicaragua
MEC has done a great deal of work on economic and labour issues with the 8,000 women in
their network in Nicaragua, and also in their inter/national advocacy work which has included
Free Trade issues and CAFTA.
MEC does not oppose free trade agreements as such, but rather irresponsible negotiations
which hand over natural resources, privatise water, eliminate national food security and pay
fines to companies (international investors). MEC’s position statement on CAFTA and other
Free Trade Agreements published in September 2003 (pre-signing) was highly critical, as
evidenced in the following Summary of Needs:
- CAFTA to be subordinated to the Nicaragua Constitution
- Substitution of the current negotiators for professionals with national vision and identity
- Strengthening of the Negotiating Groups with effective participation of the different
productive sectors and Civil Society Organisations
- Inclusion in the text of economic, social, labour and gender rights of workers (with a 30 point
list) in specific clauses within CAFTA and not as an appendix.
- Free trade agreements which stimulate national development, and not the contrary (poverty,
exclusion and dependency on the external market) and hence coherency and transparency
on government decisions with timely public information on the scope of CAFTA and any other
free trade agreement.
- Civil Society organisations to join forces with a collective position on Free Trade Agreements
which will guarantee future generations a free and prosperous Nicaragua and life with Dignity
MEC’s key awareness raising and capacity building activities on Trade and CAFTA have
been:
 “Discussion Forum on Free Trade Agreements in Nicaragua” product of a national
consultation with 1500 women, represented in the Forum by 150 women from 6
departments with a set of proposals.
34
Delgado, Roxana, Las Dignas, 27 October 2003, Email .
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

“Discussion Forum on the Impact of Free Trade Agreements on Women” with 180
participants selected from 700 women trained in a series of workshops on Free Trade
Agreements.
V Women’s Colloquium: Participants discussed Free Trade Agreements, as well as
health and safety issues in dialogue with international presenters
MEC’s current Advocacy strategy focuses on four areas: The domestic sector; he Maquila
sector; the rural area; and the economic strategy for women including economic literacy (from
the post V Women’s Colloquium Forum).
International Gender and Trade Network(ITGN) : The IGTN carries out research and
advocacy on trade issues. IGTN has focal points for each of the sub regions with the
Business Women’s Group (GEM) as the Central American Focal Point based in Mexico.
The IGTN email bulletin gives excellent coverage of worldwide trade policy processes,
including regular updates on the FTAA and CAFTA processes. IGTN in North America has
also produced a number of documents on trade which include references to the impact of
CAFTA. Finally, IGTN has recently launched a joint campaign in coordination with Central
American women’s organisations (see above).
Women’s Edge Coalition – U.S.
In January 2004, the Women’s Edge in coalition with members of Congress successfully
lobbied the USTR to conduct a Trade and Investment Review (TIR) to look at how Central
American women’s and men’s employment, wages, and working conditions may be affected
by CAFTA. Under the 2001 Trade Promotion Authority Act, the USTR is required to conduct
an assessment of how trade agreements will affect the employment of workers in the U.S.
and the other countries involved. The separate assessment of women’s and men’s
employment will be done within this analysis. Women’s Edge maintains that this gender
sensitive TIR will enable the U.S. and participating Central American countries to craft policies
that will help even the poorest women. As CAFTA has already been concluded any TIR
recommendations would have to be included as a post ratification amendment which would
open an opportunity for lobbying35.
UNIFEM/UNDP–Nicaragua / Central America
The UNDP Nicaragua and UNIFEM-Central America with National Women’s Machineries,
Gender Studies Programmes and Women’s Organisations are currently co-implementing the
Project “Capacity Building towards the analysis and positioning of women’s agenda in the
new stage of the opening up of trade”.
This project arose out of concern for the gender and equity implications of crucial fast-moving
regional processes such as the negotiation of CAFTA which was preceded by the negotiation
and implementation of the Plan-Puebla-Panama and the Mesoamerican Biological Corridor,
along with major changes in women’s insertion into the Central American economies over the
last 20 years. This is a two stage project:

Stage one 2003-2005: Mainly Capacity Building around three main aspects:
Development of a gender analysis of the Central American Economies (research and
skills); the production of gender profiles of the economies of each country (a basis for
the revising/defining Public Policy); Mapping of the institutional framework for the
35 In July 2003, the Women’s Edge’s Coalition also successfully advocated for the U.S.-Chile
agreement to include an assessment of men’s and women’s employment, however, the final
version of the analysis reduced the assessment to a mere two paragraphs, making it virtually
ineffective (January 26, 2004: The Women’s Edge Coalition Advocacy Spurs Assessment of
CAFTA’s Women Workers).
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purposes of advocacy on the economy and building an economic agenda for women.

Stage two 2005-2007: Mainly Advocacy around Public Economic Policy and agreeing
and situating Women’s Economic Agenda.
The current project was preceded by a 6 month Preparatory UNIFEM/UNDP/Governmental
project designed to create the conditions for the medium term project. The initial outputs
included: research - a gender profile of the economies of each country; a task force in each
country to supervise the research process; and a logical framework for the medium term project.
Women’s Network for Economic Transformation (REMTE). This is a relatively new Latin
America wide initiative promoting advocacy on gender and the economy at national, subregional and continental levels. It is beyond the scope of this study to cover the history of
REMTE, however, it seems that the network is slowly expanding, and is stronger in the
Andean region than elsewhere.
In the case of Central America, as national networks are not yet established women from
different organisations from each country have participated in REMTE meetings programmed
to coincide with other continental or global events 36. As interest and work around gender and
economic issues has grown there seems to have been consensus on the need to focus on
developing national networking before working towards a Central American network, rather
than create a structure without a solid working base. Communication and participation in each
others activities around economic issues including CAFTA was on the increase until the end
of 2002 37
The Maquila Solidarity Network
Pre release of the CAFTA text, the Maquila Solidarity Network viewed the advent of CAFTA in
the context of the end of the Multi Fibre Agreement and the interest of some key brand
names, such as GAP, in making Central America a safe haven for investment (particularly via
capacity building initiatives around labour rights), as something of a window of opportunity for
building stronger labour rights in Central America. 38
Work in the UK and Europe on CAFTA
This section outlines UK and European initiatives in bolstering civil society action on CAFTA.
CAFOD: Their work on CAFTA is through their partners in several countries. 39
40
Country
El Salvador
Organisation
Equipo Maís which specialises in popular education. Equipo Maís has a
programme on trade issues in general and also on CAFTA. Their work is
mostly training workshops with small farmer leaders. They also participate in
a weekly discussion group on trade issues in San Salvador and are part of
the Salvadoran campaigning group on CAFTA which organises protest
36
Some examples are: World Social Forum held in Brazil, the Latin America and Caribbean
Feminist meeting, Civil Society Forum of the Financing for Development Conference, and the
People’s Forum parallel to the WTO meeting in Cancun.
37
38
39
Campanile 2004.
Turner Oct 2003 & MSN, Codes Memo No15, Sept. 2003.
Sarah Smith-Pearce
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Country
Honduras
Guatemala
Mexico
activities.
Organisation
COMAL a network for alternative community trade works on achieving better
mechanisms for fairness in trading. They are now focusing on advocacy
and training.
CALDH, a well known human rights organisation, has a department working
on trade and labour rights which would include CAFTA.
RMALC has a programme on the WTO funded by CAFOD, and another on
CAFTA funded by Oxfam
CIFCA: Is a European wide network of NGOs working on Central America and Mexico. Their
work includes lobbying the European Union and they are currently working on European
Union involvement in trade issues in Latin America, particularly the forthcoming EU/Central
American global agreement programmed for 2004-2005.(see section European Union
relations with Mexico and Central America)
The Nicaragua Solidarity Campaign,NSC: NSC is currently undergoing strategic planning
which has included consultation with stakeholders in Nicaragua and the UK. One of the
results is that CAFTA will be the key campaigning theme in 2004, along with sub-themes
which are also linked to CAFTA, such as labour rights, trade/fair trade, privatisation,
agriculture, and the environment.
The NSC is revitalising Trade Union work with dedicated worker time and reactivation of the
trade union sub-group. NSC is also involved in the Trade Justice Movement which is planning
a campaign in September with activities all round the country. Within this campaign NSC
would like to include a speaker tour with a Nicaraguan (dependant on additional funding).
Activities for 2004:
* Special briefing on CAFTA, published mid March
* Day School 27 March for trade unionists and others on the impact of free trade agreements
on workers’ rights
* 3 Study tours – linking trade justice activists, trade unionists and fair trade producers and
consumers in Britain and Nicaragua (Globalisation (jointly with Nicaragua Network) May; Fair
trade, August; Trade union delegation (November)
* Speaker tour: 19 – 29 March: Evelie Umaña (FETSALUD)
* Further consultation with Nicaragua trade unions to develop an action plan
* Stalls at trade union conferences
* Central America Report (with other CA organisations): spring and autumn
* Nicaragua news update for members
OXFAM: OXFAM’s position on trade agreements, is that they are almost impossible to
change once signed (as all countries have to agree to negotiating a change). In the case of
CAFTA civil society groupings which have tried to influence it have been largely unsuccessful
and have also lent some credibility to the process. Hence, Oxfam has supported the NO to
CAFTA initiative which at one point proposed a moratorium as a means of buying time and
also of bringing both civil society tendencies together (it also permitted sectors of the
business community to join).
Within its Making Trade Fair Campaign, in Mexico and Central America Oxfam has
supported:
- Research on the impact of NAFTA resulting in a publication documenting the lessons from
NAFTA for the FTAA and advocacy both on NAFTA within participant countries and with other
countries for other such processes.
- Work with the Mexican farmer movement “El Campo No Aguanta Mas” to get the lessons
across particularly around food security and the importance of special products and
exemptions from liberalisation given the role of agriculture in Latin American economies and
addressing rural poverty.
- A network of women’s organisations REDGE (Red de Genero y Economia) and their links
with Central American women’s organisations to strengthen the capacity of women to
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Report / The Central America Free Trade Agreement: Gender Issues and Women’s Action
challenge these agreements, introduce a gender analysis which is largely absent, and to
strengthen women’s leadership within the broader social challenge to neoliberal globalisation.
- Many exchange initiatives. One of these is RMALC’s CAFTA programme which works with
networks and organisations throughout Central America. 41
One World Action: None of their current partners are working on CAFTA although they
previously supported MEC’s work on CAFTA. Their lobbying work is through CIFCA where
they currently have a role in advancing gender concerns in the forthcoming E.U.-Central
American Agreement 42
War on Want: Their work is mainly with labour organisations which may be involved in
CAFTA, such as the Central American Women’s Maquila Network and the Maquila Solidarity
Network which links up with organisations in Asia and the Salvadoran Network of Trade
Unions which opposes CAFTA.43)
World Development Movement: WDM is a campaigning only organisation. Its work on
trade issues has been mainly through the Trade Justice Movement which has focused on the
process around the World Trade Organisation, the GATT (General Agreement on Trade and
Tariffs) and on achieving debt cancellation, with particular attention to the role of the
European Union within each of these. With the growing entrenchment of the WTO process,
United States service companies have been pushing forward on the GATT and also on free
trade agreements in the Americas. Thus, although so far WDM has not worked on CAFTA or
the FTAA it may do so in the future. 44
41
Email: Simon Ticehurst, Oxfam’s Representative in Mexico
42
Felicity Manson.
James Treasure Evans
44
Jim Jones
43
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