What “Free Trade” Has Done to Central America
Warnings about the human and environmental costs of “free trade” went unheeded. Now the most vulnerable Central Americans are paying the price.
By Manuel Perez-Rocha and Julia Paley
Foreign Policy In Focus
November 21, 2014
https://fpif.org/free-trade-done-central-america/
In 2004 and 2005, hundreds of thousands of protesters filled Central America’s streets.
They warned of the unemployment, poverty, hunger, pollution, diminished national sovereignty, and other problems that could result if DR-CAFTA were approved. But despite popular pressure, the agreement was ratified in seven countries—including Guatemala, Nicaragua, El Salvador, Honduras, Costa Rica, the Dominican Republic, and the United States.
Ten years after the approval of DR-CAFTA, we are seeing many of the effects they cautioned about. […]
Contrary to the promises of U.S. officials—who claimed the agreement would improve Central American economies and thereby reduce undocumented immigration—large numbers of Central Americans have migrated to the United States, as dramatized most recently by the influx of children from Guatemala, El Salvador, and Honduras crossing the U.S.-Mexican border last summer [2013]. Although most are urgently fleeing violence in their countries, there are important economic roots to the migration—many of which are related to DR-CAFTA. […]
One of the most pernicious features of the agreement is a provision called the Investor-State Dispute Settlement mechanism. […] These perverse incentives have led to environmental deregulation and increased protections for companies, which have contributed to a boon in the toxic mining industry—with gold at the forefront. A stunning 14 percent of Central American territory is now authorized for mining. According to the Center of Research on Trade and Investment, a Salvadoran NGO, that number approaches 30 percent in Guatemala and Nicaragua—and rises to a whopping 35 percent in Honduras. […]
Warnings about the crises that “free trade” would bring to Central Americans were, unfortunately, correct. Central America is facing a humanitarian crisis that has incited millions to migrate as refugees from violence and poverty, thousands of them children. One push factor is the environmental degradation provoked by ruthless mining corporations that are displacing people from their rural livelihoods. […]
We must work to help Central American people regain their livelihoods lost to ruthless extractive projects like mining. And we must change trade and investment agreements to stop these excessive lawsuits that devastate communities, the environment, and democracy itself.