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Sector Analysis of the Free Trade Area of the Americas

Produced by the Alliance for Responsible Trade

Free Trade Area of the Americas (FTAA)

If you hated NAFTA, you’re in for an even more shocking surprise

The Free Trade Area of the Americas (FTAA), often described as NAFTA for the hemisphere, is a proposed “free trade” agreement that represents the next giant step in the process of corporate globalization. The FTAA began with policy initiatives formulated by former President Bush (not “W”) called the “Enterprise for the Americas Initiative.” President Clinton gave form to this proposal at the first Summit of Heads of State of the Americas in Miami in December of 1994. The summit’s goal was to “create a single market from Alaska to Patagonia … so as to integrate all countries of the continent into the global economy.” The next step in the construction of the FTAA is a meeting in Quebec, Canada, on April 21-22, 2001.

The FTAA includes every country in the hemisphere except Cuba. Negotiations are divided into nine distinct groups: Services, Investment; Government Procurement; Market Access; Agriculture; Intellectual Property Rights; Subsidies; Anti-dumping and Countervailing Duties; Competition Policy; and Dispute Settlement. Negotiating groups were proposed for Labor Rights and Environmental Standards, but never set up.

The FTAA would be much more that just a free trade agreement. Like NAFTA, the FTAA will likely give multinational corporations new legal rights, restrict the ability of governments to regulate in the public interest, and establish new rules for investment, trade in services, and public procurement. In short, it will include all of the interests of big business. The interests of working people, environmentalists, women, small business owners - the rest of us - will likely not be addressed in any significant way.

The FTAA will probably incorporate NAFTA’s “investor-state” dispute settlement system, which allows corporations to sue governments directly. The FTAA may also adopt the World Trade Organization's strong "state-to-state" dispute settlement system, which allows WTO panels (composed of trade lawyers) to overturn nations' laws as "barriers to trade" and impose punitive tariffs on countries that do not change their laws. Through these suits, corporations can force governments to change environmental, labor and other laws, thereby circumventing democratic processes and overturning civil rights that often took decades of struggle to win. Ultimately, the FTAA could make it illegal for any country to create universal public health care or maintain public education.

Since the FTAA will likely be based on he North America Free Trade Agreement, it is instructive to look at the impact of NAFTA since it was implemented in 1994. NAFTA allows for the uninhibited flow of money and goods across borders. It provides an enormous legal framework protecting the interests of multi-national corporations and international capital, but provides no meaningful protection for the rights of working people, small businesses, small farmers, immigrants or the environment.

While NAFTA has been very good for the bottom line of large trans-national corporations, it has been a disaster for working people in the United States, Canada and Mexico. Since NAFTA was signed on January 1, 1994, the United States has lost about 400,000 industrial jobs. These were generally union jobs with decent pay and benefits. Typically workers who lose these jobs find new work that pays only 70% of their former salary. Corporations often find it “cost-effective” to move their operations to Mexico, where more the 2,700 maq/*-uiladores (assembly sweatshops producing for export) have been established since 1994. Over 1.3 million Mexican workers, mostly young women, toil in these maquiladores for wages that average 50 cents an hour. Without representation by democratic unions, these workers have no job security or benefits, and are often subject to sexual harassment and unsafe working conditions. The result is a race to the bottom, where workers in both countries suffer depressed wages, worsening conditions and lack of job security.

Even in the case of Mexico, NAFTA has resulted in a net loss of jobs, as farmers and small businesses can’t compete with trans-national corporations. Since 1994, the purchasing power of the poorest 2/3 of the Mexican population has decreased by an astounding 30%, and more than half of the population is unemployed, employed part time or working in the “informal sector” (i.e., selling gum on street corners). In the United States, even in the midst of an “economic boom,” the standard of living of the poorest half of the population is declining. This is the real meaning of corporate-centered globalization, NAFTA and the FTAA.

Perhaps the most frightening aspect of NAFTA (and something that will probably be even worse under the FTAA) is the threat to democracy. Trade bureaucrats who are responsible to no one are empowered to make far-reaching decisions that often result in local, state or federal laws being overturned. Labor rights and local democratic controls that often took decades to win through grassroots struggles are being overturned. Corporate rights are superseding basic human rights.

In January of 1997, Metalclad Corporation filed a complaint under NAFTA alleging that the Mexican state of San Luis Potosí violated a number of provisions when it prevented the company from opening its waste disposal plant. Metalclad took over the facility, which had a history of contaminating local groundwater, with the obligation that it clean up preexisting contaminants. After an environmental impact assessment revealed that the site lie atop an ecologically sensitive underground stream, the Governor refused to allow Metalclad to reopen the facility. Eventually, the Governor declared the site part of a 600,000 acre ecological zone. Although Metalclad never received the necessary local permits, the company claims that this action was effectively an expropriation and won $16.7 million in damages.

In April 1997, Canada imposed a ban on the gasoline additive MMT. Some U.S. states also ban MMT, whose primary ingredient, manganese, is a known human neurotoxin. Ethyl responded to Canada's public health law with a $250 million lawsuit claiming the law violated its investor protections under NAFTA. Ethyl argued that the law was an "expropriation" of its assets because it would eliminate profits Ethyl expected to earn through Canadian sales of the additive. The Canadian government settled the suit, agreeing to pay Ethyl $13 million in damages and to cover the company’s legal costs. It will also proclaim publicly that MMT is "safe" - contradicting the position of its national environmental protection agency.

 

The FTAA has been negotiated in secret since 1994. Despite repeated efforts by non-governmental organizations, FTAA documents have never been made public. The FTAA will effect every man, woman and child in this hemisphere for generations to come, yet the public is not allowed access to texts and working documents. One of the demands of NGO’s throughout the hemisphere, including the Alliance for Responsible Trade in the US, is release of these documents.

Only one group consults regularly with these economic ministers - America’s Business Forum. Corporate leaders from throughout

the hemisphere (the vast majority are from US-based trans-nationals) meet regularly with FTAA negotiators. Top US trade officials readily admit that they see their job as primarily to represent the interests of US industry. A few representatives from non-governmental organizations have been brought into the FTAA process, but they are sworn to secrecy under criminal penalty, so they cannot communicate with their organizations or the public. Multi-national corporations are literally writing the FTAA document. The future of 700 million people is being decided by a handful of bureaucrats and corporate leaders. Is this democracy?

How will the FTAA impact labor? (by Thea Lee, AFL-CIO)

The FTAA will have a dramatic impact on the lives of working men and women in the hemisphere. An FTAA modeled on NAFTA would expand corporations’ legal right to establish themselves where they choose, and would allow companies to exercise this right, and profit from tariff reductions, regardless of how they treat the workers who make their products. Governments strapped for dollars to pay off external debts may find that heightened competition to attract foreign capital, increase exports, and stave off import competition influences their decisions about whether to enact and enforce strong protections for workers’ rights. What would this mean for workers?

If workers demand fair wages, safer working conditions, non-discriminatory treatment, or the right to form a union, their employer could pick up and move to a country where workers are not allowed to exercise these rights. In response, some governments might find that failing to protect workers’ rights is lucrative in the short term if it attracts foreign investment and does not hurt trade competitiveness. Cornell professor Kate Bronfenbrenner found evidence that NAFTA had precisely this effect: in union organizing campaigns at manufacturing plants she studied in the U.S. after NAFTA’s passage, 71% of the employers threatened to close the factory if workers formed a union. Bronfenbrenner found evidence that these threats had their desired effect, reducing the rate of success in union organizing drives. Employer mobility can also reduce employment and keep wages artificially low in the most mobile sectors, hurting workers and their families and increasing inequality in the economy. If the FTAA makes it cheaper, easier, and less risky for companies to move anywhere in the hemisphere and abuse workers’ rights with impunity, Brazilian, Chilean, and Salvadoran workers will also find that their employers have new power to ignore worker demands and threaten workers’ rights.

NAFTA-style trade and investment liberalization not only gives employers new tools and governments new incentives to repress workers rights, but it can also result in economic dislocation for workers. Forcing domestic industries to compete with new streams of imports is one of the goals of freer trade, and in theory it should lead to greater economic efficiency after a period of economic adjustment. But it is the workers employed in these sectors who must bear the brunt of the costs of adjustment, as farmers in rural Mexico and auto-workers in the mid-western United States did under NAFTA. Many displaced Mexican workers continue to seek a better life in Mexico’s maquiladora zones or in the United States, only to find their rights seldom respected and their employment precarious. The FTAA should ensure that adjustment and re-training assistance for these workers is provided, and it should create fair rules that allow all countries to protect threatened industries from sudden import surges.

Financial crises are another source of insecurity for workers in the hemisphere. Mexican workers are still feeling the effects of the 1995 peso crisis: real wages are down almost 30% from their pre-NAFTA level and unemployment, inequality, and poverty remain high. The FTAA should allow governments to control speculative capital flows instead of giving investors the right to move vast amounts of short-term capital around the hemisphere indiscriminately. Long-term, productive, and responsible investment promotes economic development - volatile, short-term speculation does not.

Public Regulations Challenged

Another feature of NAFTA that negotiators are seeking to incorporate into the FTAA is the set of limits it places on permissible federal, state, and local regulation. These rules guarantee that multinational corporations can challenge domestic laws that they think unfairly reduce the value of their investments or are otherwise overly burdensome. Absent sufficient safeguards, laws enacted to protect public health and safety, preserve the environment, defend human and workers’ rights, and guard against consumer fraud can be challenged under these rules.

NAFTA allows international investors to challenge these laws in an international tribunal without having to go through domestic courts first. Other members of the public do not have a right to participate in or even get full information about these cases until an award has been issued. Under NAFTA, investors have challenged proposed Canadian measures designed to reduce cigarette smoking, a California law regulating a harmful fuel additive, a US jury award of damages for fraud, and a Mexican state’s decision to create an ecological reserve on the site of a waste treatment facility. These cases affect workers as consumers and concerned citizens. Future cases may affect how governments regulate the workplace and employer behavior.

The FTAA might also include NAFTA provisions that limit how governments procure and regulate public services. NAFTA does not allow governments to buy goods or services based on anything but commercial criteria, i.e., governments cannot refuse to buy products made with child labor, from regimes that routinely abuse human rights, or from companies that violate basic labor and environmental standards. These rules also limit how a government provides services like health care and education in competition with the private sector. Governments may be barred from giving special support to their public service providers, such as education, unless the same support is offered to private foreign corporations. Thus the FTAA could hurt public employees as well as the large number of workers who rely on the availability of affordable, high-quality public services.

The FTAA will impact many aspects of workers’ lives: their freedom to exercise their fundamental human rights at the workplace, the security and equity of their country’s economy, the safety and quality of the environment in which they live and the products they consume, and the ability of their governments to effectively regulate in the public interest. Workers in the hemisphere can benefit from closer economic integration, but to succeed it must be based primarily on respect for human rights, solidarity, and social justice, and not exclusively on the protection of corporate rights and commerce.

How will the FTAA impact women? (By Marceline White, Women’s EDGE)

In 1993, when NAFTA was debated in halls of Congress in the United States, proponents of the trade agreement touted its benefits for workers in the United States, Mexico and Canada. Today, the results of economic integration (or free trade) in the hemisphere are evident. NAFTA has benefited corporations and large agricultural firms, but for working people, free trade has increased poverty and precariousness throughout the region.

“Every year we get poorer and poorer, even though we create more and more wealth,” said Gustavo Elizondo, mayor of Ciudad Juarez, a town on the US-Mexico border. Over 50,000 people emigrate there each year to seek work in maquiladoras, assembling products for the United States and other wealthy markets. The city is a boom town for corporations, but 12 percent of people living on the border have no access to clean water, while a third live in homes that aren’t connected to sewage systems.

Now, the United States is leading efforts to expand this NAFTA model to the entire Western Hemisphere (except for Cuba). For women, these new trade agreements bring with them particular challenges. Women and their children make up more than 70 percent of the world’s poorest people. Women are disproportionately poor in part because social and cultural discrimination means that women do not receive as much education, technological training, credit or land as men do. In addition, many societies believe that there are only certain jobs that women can do, so women are not hired for many jobs even though they are qualified. Because women are considered “secondary” wage-earners, they are the last hired and the first fired. Finally, women still do the bulk of “reproductive” work - caring for their families, preparing meals, and keeping the household clean and functioning. This invisible work means that women have less time for leisure, or to seek new jobs or gain new job skills.

Although NAFTA has helped some women gain secure jobs and improve their lives, the majority of low-income women remain mired in grinding poverty. Although women have a large stake in the outcome of trade negotiations, trade negotiators ignore women’s specific needs and concerns when negotiating new agreements. Consequently, the FTAA agreement is likely to increase the gender gaps between men and women and increase poverty for many women in the Americas.

According to a report by the International Fund for Agricultural Development (IFAD), despite overall economic growth in Latin America, rural poverty has grown 10 to 20 percent in the past three years. More than 90 million Latin American and Caribbean farmers live below the poverty line, while 47 million live in extreme poverty. The report notes that women are the sole heads of eight to ten million households in the region, two to three million women are employed as seasonal wage-laborers, while 30 to 40 million women are responsible for their household’s farming activities and small rural industries. Women seasonal laborers are likely to be much poorer than others and to compete against one another for jobs, thereby driving down wages. In addition, casual and seasonal work means that the poor spend more of their time seeking work than the non-poor - though much less of their time in long-term unemployment.

In Latin America, women account for 70 to 90 percent of workers in the export-processing zones (EPZs) where they assemble garments, textiles and electronics for export. In Ciudad Juarez, Mexico, women earn $4 a day, not a “living wage” in a border town where prices tend to be close to US prices.

Foreign firms show a preference for women workers in part because women will accept lower wages than men. Moreover, women tend to be willing to work under worse conditions than men are (for lack of other alternatives). Many workers earn as little as 56 - 77 cents an hour and often work 50 - 80 hours a week. Women workers in many factories have reported physical abuse, sexual harassment and violence. Mandatory pregnancy testing is often a condition for employment. Promotion to higher-level jobs is almost non-existent.

Discrimination is now leading to job loss for women EPZ workers. As export production becomes more specialized (and better paying), there is an increased demand for men's labor. In Mexico, the proportion of female workers in export manufacturing fell from 77 percent in 1982 to 60 percent in 1990. Without adequate training and support to upgrade women's skills, any benefits that women gain from this employment are short-lived.

The FTAA will likely not include measures to support training to upgrade women’s skills. At the same time, the FTAA agricultural agreement may lead to falling prices for crops, thus driving more women into maquiladoras as a “survival strategy” to meet their families basic needs. In addition, if other countries compete with Latin America and the Caribbean to attract multi-nationals, wages may drop further. The FTAA will likely not include mechanisms to hold corporations accountable for their actions.

The public service sector has been associated with more highly skilled and waged jobs for women. Women have worked as nurses, doctors, administrators, teachers and social workers. Privatization of social services has already been mandated for many indebted countries through the IMF and World Bank. These privatization plans have disproportionately affected women. Women workers have been the first fired under privatization. In 1991, after Nicaragua agreed to an IMF privatization plan, they laid off government workers, particularly in the health and education fields. More than 70 percent of those laid off were women. New jobs in health care and education tend to command lower wages, few benefits and little job security. Privatizing basic services will affect women consumers who cut back on doctor’s visits, schooling or other basic needs if the cost becomes too great.

Water may be privatized as part of the FTAA, which has serious health implications for women and children. If the price of water is too high for poor families as a result of privatization, women may resort to either rationing water for their families or substituting unsanitary water for clean water when necessary. Unclean water is a leading cause of child mortality and illness in developing countries. Recent IMF-led water privatization in Cochabamba, Bolivia, led a mother of five to choose between food and water when her water bill rose from $5 to $20 a month. That $15 increase had previously been the means to feed her family for a week and a half. To pay her water bill, she had to reduce the amount spent on food and clothing for her family.

How will the FTAA impact the environment? (by David Waskow, Friends of the Earth)

The FTAA will likely have a major impact on the environment in two ways: first, by undermining environmental laws and placing intense pressure on governments to lower or freeze their environmental protections; and second, by directly encouraging unsustainable trade expansion in natural resource and other environmentally sensitive sectors.

The FTAA will reinforce existing World Trade Organization (WTO) rules that have made it difficult - and sometimes impossible - for countries to protect the environment. For instance, countries would be required to meet certain scientific burdens of proof in setting their environmental measures for distinguishing among products, and would have to prove to an international tribunal that their laws and regulations are “necessary.” Moreover, countries would lack the right to use the precautionary principle in setting standards when the level of environmental risk for a product is not yet fully understood. In sum, the new global standard forces consumer to prove a product is unsafe for health and the environment, rather than requiring that the producer ensure its safety.

The FTAA could go far beyond the World Trade Organization in undermining environmental protection. The FTAA will likely include a set of investment provisions like those in NAFTA that give multinational corporations rights that are far broader than any provided under domestic US law. For example, a Canadian company is currently suing the United States under NAFTA for $1 billion in potential lost profits due to a ban imposed by California on a gasoline additive that has been shown to pose serious health risks. For those familiar with the dormant Multilateral Agreement on Investment (MAI), these kinds of investment provisions in the FTAA would essentially become an MAI for the Western Hemisphere. The inclusion of services in the FTAA would have a similar impact. In a number of critical sectors for the environment - energy, transport, water, and waste disposal, among them - the FTAA services chapter could force governments to remove regulations and open their markets without regard to environmental impacts.

The FTAA will also cause direct damage to the environment by rapidly expanding trade in natural resources and other sectors. Forests throughout the hemisphere, especially in Latin America, are already under tremendous pressure. According to one estimate, logging threatens at least 70% of Latin America’s intact natural forests. By increasing timber and wood products trade through steep tariff reductions throughout the region, the FTAA will substantially exacerbate the destruction of the hemisphere’s forests. Such forest destruction will also threaten the tremendously rich biodiversity of the hemisphere.

Mining is another sector in which trade expansion will likely lead to increased environmental damage. The mining industry throughout the Western hemisphere has already caused harm through toxic wastes, road-building and forest destruction. Trade expansion in mined products will affect many indigenous communities and vulnerable ecosystems.

Expansion of agricultural trade in certain sectors is likely to harm the environment. For example, increased trade in beef could lead cattle ranchers in Latin America to increase their production by clearing valuable forests for new ranch land. The NAFTA experience demonstrates that trade expansion - for instance, in corn - can force small-scale developing country farmers to increase their use of harmful fertilizers and pesticides in an effort to compete with a flood of imported goods.

Finally, the FTAA will harm the environment by increasing the impacts caused by the shipping of goods throughout the hemisphere. Shipping pollution will increase significantly. Sulfur and nitrogen pollution from ocean-going ships, which carry most traded goods, is already at least one-seventh of global air pollution from petroleum sources. Much of that pollution is due to shipping trade among the FTAA countries, and that quantity will increase if a free trade area for the entire hemisphere is enacted. Additionally, international shipping brings with it harmful invasive species, which are estimated to cause more than $100 billion in damage in the United States alone each year. The FTAA will exacerbate the travel of such species throughout the hemisphere, placing even greater pressure on bio-diversity, as invasive species will frequently displace native ones. The FTAA, as it is currently framed, does nothing to address these serious environmental harms.

In summary, the FTAA will likely be even more disastrous than NAFTA for environments throughout the hemisphere.

How will the FTAA impact agriculture? (by Steve Suppan, Institute for Agriculture & Trade Policy)

A clear understanding of the potential impact of the FTAA on agriculture requires an understanding of US agricultural policy. For the past 20 years, US policy has depressed agricultural commodity prices with the stated aim of increasing US market share in agricultural trade; although, US market share has actually fallen in major grains during this period. Furthermore, from 1995 to 2000, US average farmgate prices dropped 33 percent for corn, 42 percent for wheat, 34 percent for soybeans, and 42 percent for rice, while production costs skyrocketed. Although only 30 percent of US agricultural production is traded internationally, 100 percent of US agricultural policy is dedicated to dropping farmgate prices to “world prices” that continue to devastate farmers and rural communities and, as a result of NAFTA, this devastation extends to farmers in Mexico.

In fiscal year 2000, the US government paid $28 billion in subsidies, mostly to large landowners. These payments, mandated under the so-called “Freedom to Farm” legislation of 1996, comprised 49 percent of net farm income in 2000, and provided the essential liquidity for US agriculture at the farmgate level. The payments kept large farm operations in business and allowed US agribusiness to continue to pay below cost-of-production prices for agricultural raw materials. Not surprisingly, representatives of such corporate farms and agribusiness formulated and support Freedom to Farm, and will largely design FTAA agricultural proposals. Given the dependence of agribusiness on US taxpayer subsidies and given that agribusiness makes US agriculture trade policy, FTAA negotiators should expect no concessions from the United States on domestic support issues, nor a frank discussion of how such supports help agribusiness exports undersell Latin America and Canadian producers.

How will the FTAA impact consumers and food safety? (by Juliette Beck, Global Exchange)

If modeled on NAFTA, the FTAA intellectual property rules will likely undermine the ability for countries like Brazil, which has a federal policy of providing free locally-manufactured HIV drugs to its citizens, to respond to health crises such as the AIDS epidemic. These NAFTA rules also allow companies to "bio-prospect" and patent traditional medicines that are considered "traditional knowledge," effectively robbing indigenous people of their cultural heritage. In response to problems with bio-prospecting, the indigenous community in Southern Mexico declared Chiapas a "bio-piracy free zone." The faith community on the FTAA (by Maria Riley, Center of Concern)

This era of economic integration and trade liberalization brings a particular challenge to faith communities and people of faith. The foundation of “free trade” ideology is based in so-called value-free economic principles. These principles are concerned with economic results in terms of wealth creation and wealth accumulation. They are not concerned about issues that are at the heart of the concerns of faith communities, such as social and economic justice, human rights and the integrity of creation.

Over the past year many voices of protest have been raised against the current direction of globalization and its particular model of economic integration, which is increasing poverty, both between and within nations, diminishing and degrading the earth’s resources at an astonishing rate, and ignoring the basic human rights of people. The FTAA is but one of many efforts to move this form of globalization forward.

In the midst of these protests, the communities of faith have a unique and essential role:

• To bring a religious vision and moral voice to the globalization debate
• To foster a living solidarity among the peoples across the Western Hemisphere

To use their moral power to challenge governments to ensure that the process of economic decision-making be transparent, participatory and accountable to citizens across the hemisphere.

Fundamental to this vision are the dignity of the human person, the social and global common good and the integrity of creation. This vision is rooted in the belief that all persons are created in God’s image, carriers of their own human dignity and human rights. It is governments’ responsibility to protect and promote the dignity and human rights of all citizens and residents. The human family is bound together in our common human dignity, sisters and brothers called to reflect God’s love and compassion to all. Creation is the great gift of God to be shared among all peoples.

This religious vision shapes key moral values that must inform trade and investment policy. Conversely, trade agreements must be judged by these values:

• The dignity of the human person, the oneness of humanity and the integrity of creation;

• The support of the common good of society, with particular attention to the most vulnerable;

• The contribution to social justice, human rights and sustainable human development;

• The rights of people to basic needs, such as water, food, health, education and a stable livelihood;

• The mutual benefit of the trading partners and the participation and of all stakeholders;

• Respect for the role of governments and citizens to determine their own development process and to secure the welfare of all;

• Respect for the rights of people and local communities to sustainably develop their resources and productive capacities.

In judging economic policy, a guiding principle is that people are not for the economy - the economy is for people. All economic decisions must be judged by their effect on all the people, especially the most vulnerable. No child of God is unimportant or dispensable. Economic justice, which supports the common good, is essential to truly human life and community. In the era of globalization, the common good is not only local and national - it is global.

Faith communities offer viable and living opportunities to foster solidarity among the peoples of the Western Hemisphere. The faith groups are usually connected to each other by internal structures and are often connected across national boundaries. Many communities are engaged in ecumenical and interfaith work for social and economic justice. They are already engaged in solidarity work with peoples in a variety of settings, recognizing that the human family is one, sisters and brothers to each other.

The age of globalization and economic integration challenges communities of faith to continue to expand both their understanding and the boundaries of their solidarity. The economic and political powers of the world are fostering a vision and structure of economic globalization that is driven by self-interest, competition, inequality, litigiousness and punitiveness. The faith community must counter that direction with a vision and structure of solidarity, which recognizes the unity and community of the human family across national boundaries, race, ethnicity, class, gender, culture and religious faith. Religious solidarity embraces the reality that peoples’ lives and well-being are deeply connected across all boundaries; that only together can we flourish as individuals and as nations. Without such solidarity, the human family is plunged into divisions, inequalities, social disintegration, violence, and in its extreme, terrorism and wars.

To continue to foster the development of authentic solidarity across the hemisphere calls the Faith Communities to be more intentional and inclusive by:

o Deepening and expanding the theological and religious meaning of solidarity;

o Focusing reflections and sermons on authentic solidarity in the age of globalization;

o Using current church networks and structures to extend solidarity to ecumenical, interfaith and civil society groups in efforts to transform current directions of trade and investment policy;

o Use educational outreach to ensure that members of faith communities are informed and involved in the discussions of just trade and investment policy at all levels throughout the hemisphere.

The voice of Faith Communities brings the great power of moral authority to discussion of economic and social justice in public and economic policy. The critique of trade liberalization and its negative impact on peoples’ lives and well-being is strengthened when it is put in the context of religious vision and moral values. Individual voices are magnified by the communities of faith.

The current closed nature of the development of trade policy and trade negotiations prevents open and democratic debate on the directions of globalization and economic integration. FTAA negotiations have been closed to public scrutiny and debate. Even members of Congress and Parliaments across the hemisphere are not informed. It is fundamentally an undemocratic process, which will affect the lives and well-being of all.

The first and essential task is to insist that the FTAA debates and negotiations be open to greater citizen participation in all countries of the hemisphere. Moreover, the negotiations must be transparent to all stakeholders and to their duly elected officials. Only then can the citizens hold their governments accountable for their actions. Faith communities in solidarity with all citizens need to use their moral suasion in each country of the Western Hemisphere to demand that all trade negotiations be participatory, transparent and accountable by:

• Engaging the members of the communities in demanding democratic processes at all levels of government, local, national and regional;

• Addressing directly government at all levels on the current undemocratic trade negotiations.

What is the impact of the FTAA on immigrants? (by AFSC)

The flow of goods across borders and the sale of services by foreign businesses have expanded greatly in recent years due to innovations in technology, reductions in the cost of communications and transportation, and the implementation of “free trade” agreements. The proposed FTAA is just one component in this increasingly interconnected global economy. Yet this proposed agreement is unprecedented in its reach into many aspects of our lives. Immigrants are one of the groups that will be disproportionately hit. For various reasons that are outlined below, trade agreements increase the pressure on people to migrate. Trade agreements also liberalize the mobility of capital across borders, yet do not afford people, especially the poor and working class, that same right. Furthermore, immigration has become increasingly criminalized in the United States and immigrants are frequently targeted as scapegoats for the economic insecurity of the global economy. The FTAA proposes to liberalize public services, which will impact all of us, but especially the poor, many of whom are immigrants. Lastly, the FTAA would expand the power of private corporations at the expense of people.

To begin to understand the relationships between the FTAA and immigrants, let us first look at how trade agreements cause migration. The most straightforward relationship is the removal of tariffs and subsidies. When Mexico removed controls on corn imports, US corn flooded the Mexican market, forcing about a million small farmers off their land. Under the heading of “competition policy,” and with a goal of increasing competition, trade agreements such as NAFTA, and presumably the FTAA, eliminate other types of policies or regulations that may favor one producer over another. Again, after the passage of NAFTA, many local producers (both small farmers and other small businesses) in Mexico were subject to competition with large corporations who have a competitive advantage due to their size and their access to capital. Thus many local producers lose their livelihood and are forced to migrate in search of employment.

Since the passage of NAFTA, working conditions in the factories (maquiladoras) along the US-Mexico border have deteriorated. The Comité Fronterizo de Obreras (CFO) recently conducted a study to investigate NAFTA’s effect on life in the maquiladoras. Their research cites an increase in campaigns to undermine labor rights and social protections, as well as extensive use of child labor, an intensification of the labor process, and the destruction of the border area with toxic industrial waste since the passage of NAFTA in 1994. In addition, the Mexican peso devaluation in December 1994 that left less buying power in the hands of Mexicans, combined with the passage of NAFTA that same year, increased the cost of living in Mexico by a frightening 247% while wages have decreased by 30%. Who wouldn’t migrate?

Another major concern with respect to the FTAA is the inequality of mobility. As Maria Jimenez from American Friends Service Committee has pointed out, free trade agreements provide “legal flexibility for the exit and entrance of government officials, business owners, executive administrators, and … technical labor, while limiting that of low-skilled labor and the international working poor or internationally displaced who are poor.” While investors are free to move products, services, and capital across borders, workers who move - whether in response to crisis or opportunity - still face legal restraints. In fact, the free trade theory that many cite as the rationale for agreements such as NAFTA and the FTAA actually requires that workers have the freedom to search for employment across borders. But agreements like the FTAA open borders to goods and services without recognizing the need to allow for increased labor mobility at the same time. The agreement thus serves to further solidify structures that perpetuate inequality and poverty.

Unfortunately, as people become more insecure about their own economic livelihood, coupled with a lack of knowledge of the mechanisms behind the changing economy, they tend to look for scapegoats. The immigrant community has borne the brunt of scapegoating in the United States, and the result has been a militarized border and the criminalization of immigration. Policymakers responded to peoples’ fears, and built walls along the southern US border and detention centers to imprison immigrants. They limited access to asylum, increased border patrols at an unprecedented rate resulting in more immigrant deaths at the border, stripped away U.S. social welfare, and increased workplace raids that target undocumented immigrants, legal residents, and US citizens of color. In fact, migrant deaths at the border increased by a staggering 500% since 1994, the year NAFTA and Operation Gatekeeper, a strategy aimed at blocking traditional border crossing routes, commenced in California. As long as immigrants are blamed for the economic insecurity of the US working class, it will be difficult to build support for immigrant rights. Instead of leading all workers towards more economic security, the FTAA, if crafted like NAFTA, will deepen the economic crisis of the working class and the lack of support for the basic rights and dignity of immigrants, both undocumented and documented. This criminalization of immigration is shortsighted policy that caters to anti-immigrant sentiment and fails to look at the root causes of migration and the relation between the current trends in free trade, corporate globalization, and labor immobility.

In conclusion, trade agreements cause an increase in migration, perpetuate an inequality of mobility, and increase economic insecurity for the working class. Immigrants are key stakeholders in civil society and their voice is needed in constructing a peoples’ alternative to the FTAA. In response to both the proposed FTAA and the correlating criminalization of immigration, we need to facilitate the public’s understanding of the link between trade policy and domestic immigration policy, and to develop solid alternatives that promote a trade policy that facilitates sustainable and equitable development for all.

The Hemispheric Social Alliance is a coalition of national networks representing 19 countries in the western hemisphere. Since 1992 the Alliance has been working on alternatives to free trade. The result is a collaborative document - “Alternatives for the Americas.” The document has gone through four drafts and includes extensive input from civil society throughout the hemisphere. The alternatives document outlines an alternative to corporate globalization, in which working people enjoy more legal protection than corporations or capital. The document calls for: 1) direct involvement of civil society in negotiating international trade treaties, 2) strengthening environmental standards and labor rights, 3) shifting finance from speculation to productive activities, 4) closing the gap between rich and poor nations, and 5) ensuring food security and the right to development planning. A summary of the alternatives document is available at http://www.art-us.org and the complete document is available at http://www.web.net/comfront/alternatives.htm

1) Educate people in your community. Popular education materials are available from the Alliance for Responsible Trade. Contact ART at msn@mexicosolidarity.org or call 773-583-7728.

2) Join a local organization that is struggling against the FTAA or form your own committee. Contact ART for help with local organizing.

3) Mobilize for the April meetings of the hemisphere’s heads of states in Quebec City, Canada. We expect tens of thousands of people to voice their opposition to the FTAA at the Quebec meetings. To join the ART delegation to Quebec, contact msn@mexicosolidarity.org. Limited travel scholarships are available for representatives of grassroots and policy organizations.

4) Help organize a solidarity action in your own local community during the April 20-22 Presidents Summit in Quebec. Many groups nationwide are planning events that highlight both the FTAA and local impacts of globalization. For a complete list of local actions contact Jobs with Justice.

5) Set up meetings with you local editorial board, and your Senators and Representatives.

6) Work with city council members and state legislators to promote resolutions condemning the FTAA.

This statement highlights major points from "Alternatives for the Americas," a 50-page document that outlines concrete and viable alternatives to the Free Trade Area of the Americas (FTAA) based on the interests of the peoples of our hemisphere. The document was developed collaboratively by international activists and scholars and sponsored by five citizen’s networks from four countries. The U.S-based Alliance for Responsible Trade drafted this summary statement with the hope that it may be useful in facilitating discussions and informing campaigns related to the upcoming debates over fast-track trade authority, the FTAA and other trade and investment issues.

Integration needs to shift from an emphasis on exports based on the exploitation of natural resources and workers to sustainable economic activity that roots capital locally and nationally and promotes human rights. An alternative approach to hemispheric integration should be based on the following pillars:

We support the development of a democratic and accountable process for negotiating trade and investment agreements in the United States and throughout the hemisphere. Such a process must replace the current control of the economic integration agenda by major corporations and the U.S. Executive Branch (through fast-track authority).

The enforcement of core labor and environmental rights and standards should be at the center of any new agreements. Labor rights protections must extend to all workers, regardless of their immigration status, gender, or race. Experience around the world demonstrates that these standards will not be protected if they are left to market forces or relegated to unenforceable "side agreements."

Governments should be encouraged to adopt new local, national and global rules to discourage harmful speculative activity, including speculation on currencies, and to encourage lasting investments in productive and sustainable local economic activities.

While the European integration process included the establishment of massive structural funds and labor mobility to equalize conditions among the member countries, debt reduction measures might be more relevant in this hemisphere.

Access for foreign products and investments should be negotiated with due concern for national development plans and priorities. Protection of critical sectors, such as food production, must be the right of each country so as to ensure the rights and well being of all people.

A complete version of “Alternatives for the Americas” is available at http://www.web.net/comfront/alternatives.htm.

Overview by Tom Hansen, Alliance for Responsible Trade

Labor by Thea Lee, AFL-CIO

Women by Marceline White, Women’s EDGE

Environment by David Waskow, Friends of the Earth

Agriculture by Steve Suppan, Institute for Agriculture & Trade Policy

Consumers and Food Safety by Juliette Beck, Global Exchange

Faith Community by Maria Riley, Center of Concern

Immigrants by American Friends Service Committee

Alternatives by the Hemispheric Social Alliance

Americas Business Forum 3 - Belo Horizonte: http://www.alca.com.br/engl/3_papers.htm

Americas Business Forum 5 - Toronto: http://www.abf-americas-bus-forum.com/english/index.html

Alianza Chilena por un Comercio Justo y Responsible - ACJR: http://members.tripod.com/~redchile/index.htm

Alliance For Responsible Trade - ART: http://www.art-us.org

People’s Summit: http://www.peoplessummit.org

AmericasCanada.Org: http://www.americascanada.org/eventabf/menu-e.asp

Center for Economic Policy Research - CEPR: http://www.cepr.net/FTAA/ftaahome.htm

Center for International Environmental Law - CIEL: http://204.127.239.82/tae.html

Coalition to Shutdown the OAS/FTAA: http://www.tao.ca/~stopftaa/

Common Frontiers-Canada: http://www.web.net/comfront/

Corporate Watch (search keyword FTAA): http://www.corpwatch.org/trac/

Economic Policy Institute (search keyword FTAA): http://www.epinet.org/

Friends of the Earth: http://www.foe.org

Foreign Policy In Focus: http://www.foreignpolicy-infocus.org/

FTAA Official Site: http://alca-ftaa.org/alca_e.asp

Hemispheric Social Alliance: ……

Inter-American Development Bank - IDB: http://www.iadb.org/exr/ENGLISH/index_english.htm

International Confederation of FreeTrade Unions - ICFTU: http:/w/ww.icftu.org

Interhemispheric Resource Center - IRC: http://www.irc-online.org/

Institute for Policy Studies - IPS: http://www.ips-dc.org/

Library of Congress: http://thomas.loc.gov/

Mexico Solidarity Network: http://www.mexicosolidarity.org

Millennium Round Links: http://members.iinet.net.au/~jenks/andreas.html

OECD Trade: http://www.oecd.org/ech/

Public Citizen’s Global Trade Watch: http://www.citizen.org/pctrade/tradehome.html

Office of NAFTA and Inter-American Affairs: http://www.mac.doc.gov/FTAA2005/

Organization of American States - OAS: http://www.oas.org/

ORIT - Interamerican Regional Workers Association: http://www.ciosl-orit.org/

Red Mexicana de Accion Frente al Libre Comercio - RMALC: http://www.rmalc.org.mx/

SICE - OAS Foreign Trade Information System: http://www.sice.oas.org/

Summit Of the Americas Center - SOAC: http://www.americasnet.net/Trade/index.htm

US Embassy - Canada FTAA page: http://www.usembassycanada.gov/ftaa.htm

United States Trade Representative - USTR: http://www.ustr.gov

ILRF - http://www.laborrights.org

Center of Concern, Women's Project - http://www.coc.womenpro.htm

International Gender and Trade Network - http://www.genderandtrade.net

Womensedge - http://www.womensedge.org

Corporate Watch, Globalization and Corporate Rule - www.corpwatch.org

 

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Stop FTAA site [www.stopftaa.org]

Multinational Monitor [ www.essential.org/monitor/mm2001/01april/toc.html ]

Z Magazine [www.zmag.org/ZNET.htm]

Third World Network [www.twnside.org.sg]

Global Trade Watch [www.citizen.org/pctrade/tradehome.html ]

United for a Fair Economy [www.ufenet.org/econ/globalization/globalization_resources.html ]

Breaking News & Coverage

The Independent Media Center  [www.indymedia.org]
Common Dreams [www.commondreams.org]

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For more information, contact the Alliance for Responsible Trade

Tel: 202-898-1566

Tel: 773-583-7728

Email: msn@mexicosolidarity.org , Website:  http://www.art-us.org