From
[email protected] Dec 16 10:44:18 1995
Date: Mon, 25 Sep 1995 14:21:52 -0700 (PDT)
From: IATP <
[email protected]>
To: Recipients of conference <
[email protected]>
Subject: NAFTA & Inter-Am Trade Monitor 9-22
NAFTA & Inter-American Trade Monitor
Produced by the Institute for Agriculture and Trade Policy
September 22, 1995
Volume 2, Number 25
__________________________________________
Headlines:
- PUBLIC CITIZEN: NAFTA'S BROKEN PROMISES
- SETBACK FOR CBI PARITY LEGISLATION
- MEXICAN DEBT RELIEF PLAN
- MEXICAN GOVERNMENT, EZLN AGREE ON NEW TALKS
- GOLF AND TEPOZTLAN
- METALCLAD HAZARDOUS WASTES
- LOGGING PROTEST GOES TO NAFTA PANEL
__________________________________________
PUBLIC CITIZEN: NAFTA'S BROKEN PROMISES
According to a report released in September by the Public
Citizen public interest group, companies that promised to
create jobs under NAFTA have failed to do so. Public Citizen
identified specific job creation and export enhancement
promises made by U.S. companies testifying in support of
NAFTA during the 1993 debate on the trade agreement. Nearly
90 percent (59 of 66) of the specific job-creation promises
have been broken. In addition, 87 percent (13 of 15)
specific promises to increase exports have been broken.
Some companies that specifically promised to create new jobs
actually laid workers off because of NAFTA. Allied Signal,
General Electric, Mattel, Proctor and Gamble, Scott Paper and
Zenith all promised to create new jobs under NAFTA. Each
company has laid off workers, and the U.S. Department of
Labor has certified workers at each company as having lost
their jobs due to NAFTA. As of mid-August, 1995, the U.S.
Department of Labor had certified 38,148 workers throughout
the country as having lost their jobs due to NAFTA. The
certifications were made under the NAFTA-TAA (Trade
Adjustment Assistance) unemployment assistance program, and
represent only a portion of the total jobs lost due to NAFTA.
Nearly 70,000 workers in 48 states have filed for NAFTA-TAA
certification.
Mattel, a California toy manufacturer, was one example cited
in the Public Citizen report. In 1993, a Mattel vice-
president testified that NAFTA would create jobs and have a
positive effect on more than 2,000 Mattel employees in the
U.S. The NAFTA-TAA program has certified that 520 Mattel
workers in New York have been laid off due to increased
company exports from Mexico. Mattel spokespersons told the
Public Citizen researchers that it is too soon to tell
whether NAFTA has created any new jobs at Mattel.
The U.S. merchandise trade deficit with Mexico for the first
half of 1995 was $8.6 billion. The AFL-CIO estimates that
17,000 jobs are at stake for every billion dollars in trade,
suggesting that as many as 146,000 U.S. jobs have been lost
in 1995. The overall U.S. trade deficit has also increased,
reaching $11.3 billion in June.
Public Citizen, NAFTA'S BROKEN PROMISES: CORPORATE PROMISES
OF U.S. JOB CREATION UNDER NAFTA, September 4, 1995; Jim
Lobe, "NAFTA Job-Creation Promises Mocked in U.S.,"
INTERPRESS SERVICE, September 4, 1995; Nancy Dunne, "Nafta
Fails to Deliver a Feel-Good Factor," FINANCIAL TIMES,
September 5, 1995; Jill Gathmann, "U.S. Trade Deficit," VOICE
OF AMERICA, August 17, 1995.
SETBACK FOR CBI PARITY LEGISLATION
In a major blow to Caribbean Basin trade prospects, the
Republican Chair of the U.S. House Ways and Means Committee,
Rep. Bill Archer, dropped Caribbean Basin Initiative (CBI)
parity from a major budget legislative package. The
legislation, which was assured of easy passage as a rider to
the budget reconciliation bill, is not expected to pass on
its own, and may not even come up for debate.
Former U.S. President Ronald Reagan granted special duty-free
treatment for many imports from Caribbean nations in the
early 1980's, under the Caribbean Basin Initiation (CBI).
NAFTA abolished most tariffs between the United States,
Canada, and Mexico, giving Mexico a trade advantage over CBI
textile manufacturers. The CBI parity legislation, which was
supported both by Democratic President Bill Clinton and the
Republican Congressional leadership, would have given the CBI
nations equal treatment with Mexican assembly and textile
plants. Despite NAFTA, CBI textile and apparel imports to
the United States have continued to grow, reaching $4.6
billion in 1994, in contrast to $2.4 billion from Mexico.
Large U.S. textile manufacturers, including Fruit of the
Loom, Milliken, Converse Shoes, and industry associations,
opposed the CBI parity legislation, as did at least 50
congressional representatives who asked Archer to detach the
CBI parity bill from the budget legislation. Before the CBI
Parity legislation was removed from the budget rconciliation
bill, Rep. Phil Crane proposed to eliminate the NAFTA-TAA
program, a special unemployment assistance program for
workers displaced by NAFTA, and to transfer its funding to
compensate for federal tariff revenue lost due to CBI Parity
tariff cuts.
Jamaican Prime Minister P.J. Patterson, who met with U.S.
President Bill Clinton on September 13, said that Clinton had
pledged to support CBI Parity legislation and to recognize
Caribbean banana producers' need for access to their European
markets.
Jim Lobe, "CBI Parity Dropped From Key Bill," INTERPRESS
SERVICE, September 12, 1995; "Patterson Gains Trade
Assurances From Clinton," INTERPRESS SERVICE, September 13,
1995; Nick Delle Donne, "Bill Would Cut Worker Training to
Help the Multinationals," AFL-CIO IUE PRESS RELEASE,
September 12, 1995; Michael Dolan, "Severe Storm Warning:
Hurricane Crane," PUBLIC CITIZEN GLOBAL TRADE WATCH,
September 11, 1995.
MEXICAN DEBT RELIEF PLAN
On September 1, the Mexican government put in place a
Debtor's Aid Agreement, a plan to bail out the banking system
and offer some relief to debtors. The mostly government-
financed plan will reduce interest rates, extend payment
deadlines, and temporarily suspend legal proceedings and
foreclosures. By helping debtors, the plan will help the
Mexican financial sector, which currently has an "overdue
portfolio" -- unpayable debt -- equivalent to 15 percent of
the total value of deposits, compared to a worldwide average
of two percent. The plan is predicted to cost the government
$3.2 billion and to cost banks an additional $1.1 billion.
Under the Debtor's Aid Agreement credit card holders will pay
a subsidized 38.5 percent on the first $800 they owe,
corporate borrowers will pay 25 percent on the first $31,700
of their loans, and individual borrowers will pay 34 percent
interest on bank loans up to $4,750. Mortgage-holders must
renegotiate their loans in inflation-indexed terms, with
banks charging 6.5 percent in real terms for balances up to
$31,700 and 8.75 percent after that.
The government will make payments to banks to subsidize lower
interest rates. The new interest rates apply automatically
to debtors whose payments are current, but those who are in
arrears will have to renegotiate their loans. While the plan
lasts for 13 months for most borrowers, it will be in place
for 18 months for agricultural borrowers. Interest rates had
climbed as high as 120 percent, but recently dropped to 37
percent on bank loans and 77 percent on credit cards.
Researcher Carlos Tur, of the National Autonomous University
of Mexico, called the plan regressive, because it increases
the total amount that debtors end up paying to creditors, as
well as extending the time period for payments.
Representatives of El Barzon, part of the national debtors'
movement, rejected the plan, saying it would provide relief
to only 7-11 percent of the group's 1.1 million members, and
called for a moratorium on payments. The National
Association of Credit Card Users (ANTAC) also rejected the
plan as "just more of the same," criticizing it for
capitalizing unpaid interest. Finance Minister Guillermo
Ortiz claims that the plan will cover the entire debts of 75
percent of Mexican debtors.
El Barzon continued protests, briefly seizing banks in at
least a dozen cities during the week the plan was announced.
In one dramatic action, farmers left the coffin and corpse of
a man they said died of a heart attack due to worry over
debts in the foyer of a bank. Other Barzonista tactics have
included tarring and feathering a bank repossession agent in
northern Mexico and, in a subsequent action, using honey and
feathers instead of tar.
Eduardo Molina y Vedia, "Government Bail-Out of Banks Falls
Short, Experts Say," INTERPRESS SERVICE, August 25, 1995; Al
Taranto, "How Much Is Enough?" EL FINANCIERO INTERNATIONAL,
August 28-September 3, 1995; Tim Golden, "Mexico Plans $1.1
Billion in Aid for the Debt Burdened," NEW YORK TIMES, August
24, 1995; "Support Program for Mexican Banking System
Debtholders Announced," INTER-AMERICAN TRADE AND INVESTMENT
LAW, August 25, 1995; Kevin G. Hall, "Mexican Accord to Bail
Out Debtors a Mixed Blessing," JOURNAL OF COMMERCE, August
25, 1995; Leslie Crawford, "Mexico to Fund Relief for
Domestic Debtors," FINANCIAL TIMES, August 25, 1995; Dianne
Solis, "In Mexico, A New Kind of Rebel Emerges," WALL STREET
JOURNAL, September 1, 1995; "New Program to Restructure
Outstanding Loans (ADE)," MEXPAZ, August 29, 1995.
MEXICAN GOVERNMENT, EZLN AGREE ON NEW TALKS
In a seven-day negotiating session in early September,
representatives of the Mexican government and the rebel
Zapatista National Liberation Army (EZLN) made progress
toward an eventual agreement. The negotiators agreed that
they would begin to discuss four areas in October: indigenous
rights, democracy and justice, well-being and development,
and the rights of women in Chiapas. The next discussion will
focus on indigenous rights.
While still maintaining that their negotiations with the EZLN
must be limited to Chiapan issues, the government delegates
said they will agree to "discussion" but not "negotiation" of
national issues.
EZLN negotiators credited their just-completed national
plebiscite with "opening the eyes of the government" and
moving negotiations along. The government has now agreed
that the EZLN can, in some way, participate in a planned
dialogue on national political issues that will be held
between national political parties.
Anthony DePalma, "Mexico Agrees With Rebels on New Talks,"
NEW YORK TIMES, September 12, 1995; Diego Cevallos,
"Government and Rebels Reach Initial Accord," INTERPRESS
SERVICE, September 11, 1995; Jose Gil Olmos and Elio
Henriquez, "La Consulta 'Abrio los Ojos del Gobierno' Para
Ver el Alcance Nacional del EZLN: Tacho y David," LA JORNADA,
September 11, 1995; Jose Gil Olmos and Elio Henriquez,
"Acuerdo: La Primera Mesa, Sobre Derechos Indmgenas," LA
JORNADA, September 11, 1995; "Mexican Rebels to Participate
in National Dialogue," WEEKLY NEWS UPDATE ON THE AMERICAS,
September 10, 1995.
GOLF AND TEPOZTLAN
International plans for an 18-hole golf course, a heliport, a
$30 million computer center, and luxury residential and
recreational facilities ran headlong into an alliance of
peasants, villagers, and environmentalists in the town of
Tepoztlan, about an hour's drive south of Mexico City in the
state of Morelos. The 500-acre development would be built on
private land that is located inside the Tepozteco National
Park, in which Tepoztlan and four other towns are also
located. Investors and participants include GTE Data
Services, Jack Nicklaus Golden Bear Course Management, and
powerful Mexican political and economic figures, including
members of the Slim family.
Tepoztlan residents, who are mostly indigenous Nahuas, seized
the town hall on August 24, throwing out the mayor who had
approved the construction plans. When construction began on
September 3, 3,000 of Tepoztlan's 13,000 residents protested
in the main plaza, seizing six local officials as hostages
and running out of town the 200 state riot police sent to
stop the protest. Although the hostages were later released,
protests continued, with thousands of residents of other
Morelos municipalities joining the Tepoztecos. On September
8, Mexico's environmental attorney general Antonio Azuela de
la Cueva temporarily suspended construction, saying that
zoning laws had been violated.
Among the villagers' objections: the proposed development
would cover an archeological site that some consider sacred
ground; the golf course would use more than half a million
gallons of water daily, threatening water shortages in the
town; herbicides and insecticides used on fairways threaten
28 species of mammals, reptiles, and songbirds; the town
already has nearly full employment and does not need the new
service jobs.
Francisco Guerrero Garro, "Ocupacion de la Alcaldia en
Tepoztlan," LA JORNADA, September 6, 1995; Angelica Enciso
and Francisco Guerrero, "Morelenses de 25 Municipios Se Unen
a Tepoztecos; Ayer, Mitin Masivo," LA JORNADA, September 11,
1995; Emilio Zebadua, "Tepoztlan, Hoyo 18," LA JORNADA,
September 6, 1995; Sam Dillon, "A Mexican Town Rises Up
Against a Development Plan," NEW YORK TIMES, September 4,
1995; "Mexican Protests: Bus Drivers and the Golf War,"
WEEKLY NEWS UPDATE ON THE AMERICAS, September 10, 1995.
METALCLAD HAZARDOUS WASTE SITE
A U.S. company, Metalclad Corporation, is nearing final
approval of La Pedrera, a large hazardous waste dump in
Guadalcazar in the Mexican state of San Luis Potosi.
Metalclad recently acquired a Mexican company, COTERIN, which
will run this and other hazardous waste facilities that it
plans in Mexico. COTERIN is responsible for a contaminated
dump at the La Pedrera site, but still won government
approval for the new project.
Metalclad says the cleanup of 20,000 tons of hazardous waste
already on the La Pedrera site is conditional on approval of
commercial reopening of the toxic waste dump. Residents of
Guadalcazar have fought the re-opening of the toxic waste
dump for five years, ever since Mexican environmental
authorities closed the COTERIN-operated site. Local
engineers and ecological experts say the whole dump should be
relocated, because it is sited on an earthquake fault.
"Call for International Solidarity for Environmental
Justice," GREENPEACE MEXICO, September 18, 1995; Alva Senzek,
"U.S. Judge Tests NAFTA Waters," EL FINANCIERO INTERNATIONAL,
August 14-20, 1995.
LOGGING PROTEST GOES TO NAFTA PANEL
The Sierra Club and National Resources Defense Council,
joined by other groups from the United States, Mexico, and
Canada, have filed an appeal to the North American Council on
Environmental Cooperation (NACEC) in Montreal, protesting new
U.S. legislation that would allow logging of fire-damaged
trees on federal lands for 18 months without regard to
existing U.S. environmental laws. Among the laws temporarily
suspended is the Endangered Species Act.
NACEC is an inter-governmental panel set up by NAFTA to
investigate possible violations of national environmental
laws in the three NAFTA member countries that could affect
trade.
Douglas Heiken, a member of the Oregon Natural Resources
Council, says the new law will encourage the burning of
forests in order to open them for logging. Heiken cites
Oregon state investigators' reports that most large fires in
Oregon appear to be the work of arsonists.
The Sierra Club appeal is the third petition to NACEC. The
first appeal was submitted in June by the Grupo de los Cien
(the Group of 100), the Mexican Centre for Environmental
Rights, and the U.S. National Audobon Society, asking NACEC
to investigate the suspicious deaths last year of 40,000
birds at a lake in central Mexico. The second appeal calls
for review of a new U.S. law that bans the U.S. Fish and
Wildlife Service from naming new endangered species or
marking out new protected areas under the Endangered Species
Act for one year. Two other appeals -- one involving reduced
U.S. funding for the Environmental Protection Agency and the
other involving a proposed salt expansion venture in Baja
California -- are expected soon.
John Maggs, "Environmentalists Give GOP Ammo Against Nafta
Deal," JOURNAL OF COMMERCE, August 31, 1995; William
Dibenedetto, "US Faces Nafta Challenge Over Logging Program,"
September 6, 1995; Pratap Chatterjee, "Greens Ask NAFTA Panel
to Prevent Logging," INTERPRESS SERVICE, September 4, 1995.
RESOURCES/EVENTS
NAFTA's Broken Promises: Corporate Promises of U.S. Job
Creation Under NAFTA, Global Trade Watch, Public Citizen.
Details specific promises of job creation by companies
lobbying in favor of NAFTA in 1993, and subsequent failure to
produce jobs. $12. Order from Public Citizen Publications,
1600 20th St. NW, Washington D.C. 20009. Credit card orders
by telephone 1-800-289-3787.
"Cleaning Up the Border: New Promises Under NAFTA," Summer
1995 issue of THE WORKBOOK, a quarterly publication of the
Southwest Research and Information Center. 46 pp. Order from
SRIC, P.O. Box 4524, Albuquerque, NM 87106. Subscriptions
$8.50 students and seniors; $12 individuals; $25
institutions; Canadians add $4. Fully indexed catalog of
sources includes book reviews on various topics as well as
feature articles on citizen involvement in border clean-up,
border environmental health councils, wastewater management
in Tijuana, and extensive reportage on the Border Environment
Cooperation Commission.
ECOREGION, an official publication of the Secretariat of the
Commission for Environmental Cooperation (CEC). 8 pp.
Commission for Environmental Cooperation, 393 St-Jacques
West, Suite 200, Montreal, Quebec, Canada H2Y 1N9; telephone
514/350-4300; fax 514/350-4314; email:
[email protected].
"Designed to inform you of the CEC activities,
accomplishments and future directions."
___________________________________________
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]
