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Why AFSC Opposes CAFTA

On 28 May 2004, representatives of the US and five Central American countries signed the Central American Free Trade Agreement (CAFTA), which will do more than just eliminate tariffs and trade barriers between those countries. Pushed by powerful corporate interests, this agreement was crafted in secret. CAFTA is based on the seriously flawed North American Free Trade Agreement (NAFTA), and it extends and amplifies the harmful aspects of NAFTA in the following ways:

1. CAFTA would hurt workers in the US and in Central America

• CAFTA would “legalize” sweatshops by only requiring countries to enforce their own labor laws, even though many fall far below international labor standards.
• Fines for labor violations would be paid by the country to itself…not by the violating company!
• Competition will continue to move jobs out of the US and push wages lower throughout the region.

2. CAFTA would especially harm those who are most vulnerable

• CAFTA, like NAFTA has done in Mexico, would pit poor Central American farmers against highly subsidized US agribusiness.
• Grain prices would drop dramatically in Central America, forcing small subsistence producers off their farms and into overcrowded cities where unemployment is already high.
• CAFTA would limit generic drug production by preventing open access to necessary medical test data, preventing the poor from receiving life-saving medications.

3. CAFTA stifles democracy

• The CAFTA text was not made available to the public until after negotiations were complete. Little public comment or input was solicited.
• Fast Track Authority forces Congress to vote Yes or No on trade deals – preventing our representatives from responding to constituents and influencing or amending the agreement.

4. CAFTA prevents governments from protecting the welfare of their people

• CAFTA could be used to promote privatization and deregulation of essential services, such as health, education, and water, resulting in prohibitive price increases, reduced access, and compromised quality.
• CAFTA would prevent governments from giving preferences to local firms and from promoting gender equity, social justice, and respect for human rights when granting contracts.
• CAFTA will lead to further outsourcing of jobs, including those related to government services.

5. CAFTA would prevent local communities from protecting their natural resources

• CAFTA will be used to weaken national and international environmental standards. Companies would have the right to sue any government that obstructs their capacity for profit with environmental regulations.
• Multinational corporations would be given patents on plants that would take away farmers’ traditional rights to save their own seeds.

Fair trade agreements are possible. They must, however, be developed democratically and with the aim to foster a more just, sustainable, and prosperous human society.

You Can Help! See the Stop the CAFTA Vote campaign action alert.