From
[email protected] Aug 19 18:48:38 1995
Date: Fri, 18 Aug 1995 15:03:33 -0700 (PDT)
From: IATP <
[email protected]>
To: Recipients of conference <
[email protected]>
Subject: NAFTA & Inter-Am Trade Monitor 8-18
NAFTA & Inter-American Trade Monitor
Produced by the Institute for Agriculture and Trade
Policy
August 18, 1995
Volume 2, Number 23
__________________________________________
Headlines:
- MAQUILAS AND LABOR
- CHILE MAY WAIT ON NAFTA
- CAMPESINOS KILLED IN BRAZIL PROTESTS
- FORECLOSED MEXICAN PROPERTY SET FOR AUCTION IN TEXAS
- MEXICAN DROUGHT INCREASES GRAIN IMPORTS
- COFFEE PRODUCERS RESTRICT EXPORTS
__________________________________________
The next issue of the NAFTA & Inter-American Trade
Monitor will appear on September 8. There will be no
issue on September 1.
__________________________________________
MAQUILAS AND LABOR
Labor rights continue to be a major area of dispute in
international trade discussions. Complaints to the
United States Trade Representative (USTR) this year
charged Guatemala and Colombia with failure to protect
workers' rights, and asked the USTR to withdraw the
benefits given the two countries under the generalized
system of preferences (GSP). The complaints against
Guatemala, filed by the AFL-CIO, cite increasing violence
and recent killings of several union members. The AFL-
CIO, Human Rights Watch, and the International Labor
Rights and Education Research Fund (ILSRERF) all
Colombia lacks freedom of association and the right
to organize and bargain collectively. Despite
constitutional guarantees, workers' rights are violated
by widespread violence in Colombia. The AFL-CIO also
complained of child labor in Colombia.
In May, the Central American Parliament unanimously
resolved "to take action against the interference of
U.S. labor unions in the Central American maquila
industry." Maquila proponents object to U.S. union
pressure to raise wages and environmental standards.
Some U.S. companies have responded to consumer concerns
about foreign labor practices by instituting codes of
conduct for contractors. J.C. Penney Company requires
apparel makers to sign a code of conduct forbidding any
violation of local labor law, but the agreements are
routinely ignored. A maquila owner in Guatemala reports
that his business has "never had any request from Penney
about how we pay or treat workers -- just the quality of
our production." Visits to factories supplying Penney
find workers under the legal age of 14 and others paid
less than the minimum wage of $2.80 per day and forced
to put in unpaid overtime. Penney's Guatemalan buying
office director concedes that he has never reported any
supplier violation of the company code. The Guatemalan
Labor Ministry's child-worker protection chief says her
office does not have the personnel to investigate an
estimated 300,000 illegally employed child workers.
Levi Strauss employs inspectors to police working
conditions in developing world factories, but concedes
that they don't dig deeply for fear of offending factory
owners. The director of imports for the Target chain
says policing is impossible: "I don't want to sound
callous, but we probably have 150 major contractors, and
sometimes we don't know which factory something is
coming from." Target has a code, but does not monitor
compliance.
The Caribbean Basin Trade Security Act (CBTSA),
currently before the U.S. Congress, would end U.S.
duties for exports from 24 Central American and
Caribbean maquiladoras. The bill, also known as the CBI
parity bill, would provide trade benefits roughly
equivalent to those received by Mexico under NAFTA, but
does not include equivalent workers' rights provisions.
Central American countries complain that textile
companies are moving to Mexico because of NAFTA. The
Federation of Private Entities of Central America and
Panama says that 74 companies moved from Guatemala to
Mexico in the last year, leaving 20,000 Guatemalans
unemployed. Overall, however, CBI textile exports
continued to increase in 1994.
"Maquila Industry Opposes U.S. Unions' Claims," CENTRAL
AMERICA REPORT, June 23, 1995; Bob Ortega, "Broken
Rules: Conduct Codes Garner Goodwill for Retailers, But
Violations Go On," WALL STREET JOURNAL, July 3, 1995;
"Latin Nations Charged With Failure to Protect Worker
Rights, Patents," WASHINGTON REPORT ON LATIN AMERICA AND
THE CARIBBEAN, July 7, 1995; "Congress Considering
Millions in New Tax Breaks for Central American
Maquiladoras But Ignores Need to Respect Worker Rights,"
US-GUATEMALA LABOR EDUCATION PROJECT, July 27, 1995;
Peter Brennan, "Costa Rica Sees Textile Jobs Begin to
Move to Lower-Cost Countries," JOURNAL OF COMMERCE,
August 10, 1995.
CHILE MAY WAIT ON NAFTA
After a first round of talks between Chile and current
NAFTA members in Mexico City, Chilean chief negotiator
Juan Gabriel Vald�s reiterated that Chile will not enter
into substantive negotiations unless the United States
has fast track negotiating authority in place. The U.S.
Congress has not reached agreement on fast track, and
will not vote until some time in October. Republicans
are generally in favor of trade pacts but reluctant to
give President Bill Clinton negotiating authority, while some
Democrats are reluctant to see any widening of NAFTA.
Even those Democrats who favor NAFTA and Chilean
accession disagree with Republican demands to exclude
labor and environmental provisions from a trade
agreement with Chile.
U.S. Representative Marcy Kaptur (D-OH) said she will
introduce a bill to force renegotiation of all of NAFTA,
which she has consistently opposed. "NAFTA was supposed
to create jobs in the United States. It has done
exactly the opposite." said Kaptur. She also faulted
NAFTA for increasing illegal immigration, increasing
uncertainty in currency markets, and creating what is
projected to be the largest-ever U.S. trade deficit this
year.
Rep. Charles Rangel (D-NY) said in early August that
drug interdiction should also be part of trade
negotiations, and that trade agreements should leave
open the possibility of using tariffs to punish
countries that tolerate drug production and trafficking.
House Trade Subcommittee chair Rep. Phil Crane (R-IL)
flatly rejected Rangel's proposal, saying it would "open
a Pandora's box" of non-trade issues and protectionism.
Vald�s said that Chile will evaluate the situation in
late September. Meanwhile, negotiations for Chilean
association with Mercosur, the Southern Common Market of
Argentina, Brazil, Paraguay, and Uruguay, will continue
in Uruguay on August 21 with discussion of lists of
exceptions to the common external tariff. Chile and
Mercosur have agreed to speed up the negotiations,
hoping to reach an agreement by the end of this year.
Chile's possible entry into NAFTA complicates the talks,
as Mercosur wants the same preferential tariffs that
Chile will offer NAFTA. The Chilean business and
agricultural sectors are reluctant to see this
concession.
Kevin G. Hall, "Chile Will Wait Until September to
Decide on Substantive Nafta Talks," JOURNAL OF COMMERCE,
July 27, 1995; John Maggs, "GOP Bill on Chile, Nafta
Derailed," JOURNAL OF COMMERCE, August 2, 1995; Kevin G.
Hall, "US: Nafta Negotiations Too Slow; Chile: Talks Are
Learning Experience," JOURNAL OF COMMERCE, August 2,
1995; David Bennett, SAN ANTONIO EXPRESS-NEWS, July 26,
1995; John Maggs, "Key House Democrat Wants to Add Drug
Interdiction to Nafta Talks," JOURNAL OF COMMERCE,
August 3, 1995; Gustavo Gutierrez, "Mercosur: Chile
Races Against the Clock Towards Association Pact,"
INTERPRESS SERVICE, August 9, 1995; Gustavo Gutierrez,
"Will Asuncion Meet Chile's Needs?" INTERPRESS SERVICE,
August 3, 1995.
BRAZIL: AGRARIAN PROTESTS TURN BLOODY
On August 9, at least 32 people were killed when 200
heavily-armed anti-riot police troops violently evicted
hundreds of campesinos from farmland they had been occupying
in the northern Brazilian state of Rondonia. At least
53 more people were arrested, 11 police officers were
injured, and 355 people were arrested in a nearby town,
according to government spokespersons. Non-governmental
sources such as the Rondonia Rural Workers Federation,
the Landless Peasant Movement and the Catholic Church's
Pastoral Land Commission said the number of people
killed is more likely to be around 70. The squatters
were armed with machetes, sticks, and knives when police
came to burn their houses and drive them out of the
absentee-owned, 40,000-acre Santa Helena farm.
On July 25, more than 5,000 campesinos had gathered at
the third annual congress of the Landless Peasant
Movement (MST) in Brasilia. The MST advocated continued
land occupations until Brazil implements agrarian
reform, and its members have taken over at least 87
farms. The MST says that only 60 million hectares of
400 million suitable for farming are currently
cultivated, and that 56 million of the cultivated acres
belong to just 2,000 owners while 4.8 million families
are landless. During the past decade, 100,000 families
have been given land rights, 700 campesinos working for
land reform have been murdered, 370 have been tortured,
13 cases have been tried, and four people have been
found guilty.
Brazilian law provides that the government can
appropriate unproductive land and distribute it to
landless campesinos. President Fernando Henrique
Cardoso promised to settle 40,000 families this year and
a total of 280,000 during his four-year term. His
agriculture minister, Jose Andrade Vieira, himself a
large landowner, has tried to lower the targets
announced by Cardoso during the presidential campaign.
On July 19, farmers from 16 Brazilian states blocked
traffic in Brasilia with a caravan of 1,000 trucks and
tractors, demanding that the government stop adjusting
their debts under the monetary index (TR) that measures
inflation, and give farmers a 10-year period to pay
their debts. Farmers who are in default on their debts
cannot obtain new loans.
Farm protesters said that the agricultural sector's old
debts total more than $4.5 billion, more than one
billion of which is due to the TR surcharge. The
surcharge has raised agricultural debt by 1,200 percent
over the past 18 months, with corn and soy prices going
up by only 407 percent and 289 percent. Protesters also
pointed to competition from Mercosur imports and to the
government's failure to guarantee minimum prices while
over-valuing the national currency as causes of their
difficulties. Despite a grain harvest expected to be
six million tons greater than last year's, farm income
will drop by $5.6 billion this year.
Agriculture Minister Vieira said that the TR index is
used for all other industries, and it would not be
possible to stop its use for past agricultural debts.
President Cardoso has promised lower interest rates for
future production loans for basic products.
"Landless Peasants Massacred in Brazil," WEEKLY NEWS
UPDATE ON THE AMERICAS, 8/13/95; "Brazilian Peasants
Committed to Land Takeovers," WEEKLY NEWS UPDATE ON THE
AMERICAS, 7/30/95; Mario Osava, "Brasilia Awakens to
Protesters' Horns," INTERPRESS SERVICE, July 19, 1995;
"Farmers Protest in Brazil," WEEKLY NEWS UPDATE ON THE
AMERICAS, 7/23/95; Angus Foster, "Land Battle Turns
Bloody in Brazil," FINANCIAL TIMES, August 12, 1995.
FORECLOSED MEXICAN PROPERTY AUCTION IN TEXAS
Homes, residential and industrial properties, hotels and
condominiums, and commercial centers from nine Mexican
states will be auctioned in San Antonio, Texas by
Lasalle Partners. The properties to be auctioned in
Texas have been seized by Banamex, Serfin, Zaverlat,
Banorte and Bancentro for non-payment of loans. The
auction, originally scheduled for August 11 but now
postponed until the end of the month, has been met with
angry opposition within Mexico, where debtor
organizations refuse to pay what they call usurious
interest rates.
"Mexican Properties to be Auctioned Off in Texas,"
Statement of Victor Quintana, Federal Representative
from Chihuahua, July, 1995.
MEXICAN DROUGHT INCREASES GRAIN IMPORTS
In northern Mexico, one of the worst droughts in history
has reduced yields and forced small farmers off their
land. Fall planting may not be possible in Chihuahua,
Durango, Nuevo Leon and Tamaulipas, where rainfalls as
of April 30 were 40 percent below normal. Wheat
harvests are expected to fall from four million metric
tons last year to 2.5 million metric tons in 1995-96.
The Mexican agriculture ministry estimates that grain
imports will be at least nine million tons this year,
two million higher than anticipated. The Confederacion
Nacional de Propietarios Rurales estimates that grain
imports will reach 17 million tons.
Mexican water reservoirs have dropped so far that
irrigation has been stopped in the northern agricultural
region, in order to conserve water for domestic use.
Dropping water volumes have increased salt content,
making water unsuitable for consumption or irrigation.
The International Boundary and Water Commission, which
governs water allocations from the Rio Bravo/Rio Grande
and several of its tributaries, reported that on July 1
Mexico had only 6.77 percent of stored water capacity
available, while Texas had 47.11 percent of its stored
water capacity available. Under the terms of a 1944
treaty, Texas can use all the flow from tributaries on
the U.S. side of the river, while Mexico has to share
the flow from its tributaries with Texas. Texas
Governor George Bush and the U.S. State Department
earlier this year denied a Mexican request for water for
irrigation, but may consider giving Mexico water for
human consumption.
Marcelo Morichi and Jan Gilbreath, �Drought Brings
Severe Crop Reductions and Cattle Losses in Northern
Mexico,� U.S.-MEXICAN POLICY STUDIES PROGRAM, July 21,
1995; Kim Archer, "Big Drop Forecast for Production of
Mexican Wheat as Plantings Fall," JOURNAL OF COMMERCE,
August 14, 1995.
COFFEE PRODUCERS RESTRICT EXPORTS
Meeting in Bogota, Colombia in early July,
representatives from Brazil, Colombia, Costa Rica, El
Salvador, Honduras, and Nicaragua agreed to strictly
limit coffee exports in order to bolster falling
international prices for coffee. The agreement reached
by the six countries sets quarterly quotas for each
country for the next year, consistent with the
Association of Coffee Producing Countries (ACPC)
agreement reached in London in March. The ACPC plan
calls for worldwide exports of 60.376 million 132-pound
bags during the next year, down from an expected 69
million bags. Coffee prices have dropped drastically
from $1.80 per pound to $1.22 per pound since the
beginning of 1995.
The Mexican National Coordinator of Coffee Organizations
(CNOC), which represents more than 60,000 producers,
supports the agreements to limit exports and has
petitioned the Mexican government to join the ACPC.
Mexico is the only leading coffee producer to remain
outside the ACPC plan.
Colombia's National Coffee Union held a 24-hour strike
on July 19, demanding government aid to increase prices,
to replace disease-killed plants and to forgive $200
million in coffee-growers' debts.
"Coffee Retention Agreement Reached," U.S. STATE
DEPARTMENT REPORT, July 12, 1995; Erin Brummett, "Costa
Rica/Coffee," VOICE OF AMERICA, July 6, 1995; "Coffee
Growers Strike in Colombia," WEEKLY NEWS UPDATE ON THE
AMERICAS, July 23, 1995; "Mexico Supports Latam Coffee
Export Limits," REUTERS, July 14, 1995; "Coffee Prices
Retreat as Doubts Rise Concerning Export Limits," NEW
YORK TIMES, July 28, 1995; "Mexico Alone as Guatemala
Joins Coffee Export Plan," REUTERS, August 7, 1995.
RESOURCES/EVENTS
LATIN AMERICAN LABOR NEWS, a publication of the Center
for Labor Research and Studies, Florida International
University. Journal includes reporting on Latin
American trade unions and their struggles, news on
inter-American labor solidarity, academic research,
calls for papers. (Articles are published in original
languages of English, Spanish, Portuguese in 1994 double
issue.) Back issues available for $7.50-$30 include
1992, 1993, 1994, and 1995 issues focusing on labor and
free trade. Published once or twice annually.
Subscription is $15 individual, $30 institutional.
Zoned for Slavery: The Child Behind the Label, a video
report on maquila manufacturing produced by the National
Labor Committee in Support of Worker and Human Rights in
Central America. $12. This 23-minute video focuses on
the conditions of maquila workers in Honduras. National
Labor Committee, 15 Union Square, New York, NY 10033.
Telephone 212/242-0700, fax 212/255-7230.
___________________________________________
Produced by the Institute for Agriculture and Trade
Policy, Mark Ritchie, President. Edited by Mary C.
Turck. The NAFTA & Inter-American Trade Monitor is
available free of charge to Econet and IATPNet
subscribers. For information about fax or mail
subscriptions, or other IATP publications, contact: The
Institute for Agriculture and Trade Policy, 1313 5th
Street SE, Suite 303, Minneapolis, MN 55414. Phone: 612-
379-5980; fax: 612-379-5982; e-mail:
[email protected]. For
information about IATP's contract research services,
contact Dale Wiehoff at 612-379-5980, or e-mail:
[email protected]
