America's Plan for the Americas

from Stop FTAA website


Executive Summary

Market Access

The U.S. proposal fails to adequately address the concerns of many civil society organizations with regard to WTO and NAFTA rules on technical barriers to trade. In these existing agreements, laws designed to protect public health and safety and the environment can be ruled impermissible if they are more trade-restrictive than necessary. The FTAA proposal merely mentions that they are examining these existing rules. The U.S. proposal ignores the demand of many organizations that market access rules allow countries to ban imports that are produced through the violation of worker or human rights or environmental degradation. The proposal allows countries to lift import tariffs on certain sensitive products more gradually than on others. However, the proposal still ensures that each country will move at the same pace toward zero tariffs on the same amount of imports, rather than allowing special and differential treatment for less developed or smaller economies, per the WTO agreements.


The USTR supports inclusion of a NAFTA provision that gives corporations (but not citizens or NGOs) the right to sue governments directly through the dispute settlement mechanism. This is an example of the excessive powers enjoyed by corporations under NAFTA that should not be expanded. The proposal is vague on the most controversial aspect of the NAFTA investor-state provision, which allows corporations to sue governments over public interest regulations that diminish the corporation's potential future profits. The proposal merely calls for a "common understanding" of this provision-without explaining what this understanding should be. The proposal calls for a broad prohibition on capital controls, ignoring evidence that such controls can help protect economies from financial instability. The proposal calls for a ban on a number of "performance requirements" on investors (e.g., requiring a specified level of local content in production)-even though such conditions have been used appropriately to achieve national development goals. The U.S. position is to urge (but not require) FTAA countries not to relax labor and environmental laws in order to attract foreign investment. Even if this were a binding agreement, it would be virtually meaningless in countries where such laws are already weak and would do nothing to strengthen enforcement or raise existing standards.


The USTR does not indicate that it intends to ensure in any way that environmental laws and regulations will be protected from inappropriate challenges by trade rules. The USTR fails to clarify whether it will work to include in the FTAA the requirement that exists in the WTO and NAFTA that countries meet certain scientific burdens of proof in setting environmental standards. Environmental organizations have criticized these requirements, advocating instead the use of the "precautionary principle" (potentially dangerous substances must be proven safe before allowed on the market). The proposal ignores the need to address the significant environmental costs likely to occur due to increased forestry, mining, shipping transport, fossil fuel extraction, and other environmentally harmful activities following the enactment of the FTAA. The proposal ignores the key question of the relationship between the FTAA and multilateral environmental agreements. Many environmental organizations have demanded that protocols such as the Biodiversity and Climate Change Conventions take precedence over trade rules. In the investment and services sections of the U.S. proposal, the USTR gives no indication that it intends to include exceptions for environmental protection like those provided for trade in goods.


The USTR's efforts to fulfill its promise to include labor standards in the FTAA have been weak and resulted in failure. The only negotiating proposal submitted by the United States is an unacceptably weak request in the investment negotiating group that countries "strive to ensure" that labor laws are not relaxed to attract investment. The Civil Society Committee of the FTAA does not offer meaningful participation to workers or their representatives. Despite the lack of progress on labor, the USTR has continued to be an active promoter of the FTAA process.


The United States proposes a "top-down" approach in which all service sectors are liberalized unless a country succeeds in negotiating a reservation for a particular sector or measure. This would significantly expand the scope of the WTO's General Agreement on Trade in Services, which uses a "bottom-up" approach where countries specify what services will be covered. The summary denies that the United States is promoting privatization of education and health care through the FTAA. However, it does not call for excluding them through carve-outs, as it proposes for air transport services. The proposal goes beyond NAFTA by including measures taken by local governments, in addition to national and regional authorities. This means that FTAA governments at all levels would have to grant service providers from other FTAA countries the same treatment as domestic providers. It would also make regulations at all levels vulnerable to corporate lawsuits through the investor-state dispute settlement process (see Investment section).


The United States calls for agricultural products from non-FTAA countries to be prevented from being exported to FTAA countries with the aid of export subsidies. This is aimed at European Union countries, which rely heavily on export subsidies. Such discrimination may be WTO-illegal. The United States overlooks concerns that the U.S. use of export credit guarantees also helps agribusinesses unfairly undersell Latin American and Canadian producers. The United States can be expected to offer market access opportunities for other FTAA countries in "import non-sensitive commodities," primarily as leverage for achieving U.S. goals in other negotiating groups. The U.S. position is to require FTAA countries to conform to the WTO agreement on sanitary and phyto-sanitary standards. Currently, the United States uses these standards to reject about a third of inspected Latin American agricultural exports. Many of these countries' budgets for SPS infrastructure have been crippled by structural adjustment policies.

Safeguards, Subsidies, and Anti-dumping

The U.S. proposal indicates a desire to "deepen" existing WTO rules on subsidies. This raises concerns that the USTR may attempt to weaken the provisions in the existing rules that allow countries to maintain domestic subsidies in areas that are important for development. The proposal fails to recommend any hemispheric mechanism for providing adjustment assistance to workers and communities adversely affected by import surges. The proposal would allow safeguards to protect countries in the event of temporary import surges only during the first 10 years of the agreement, which may not be sufficient.

Intellectual Property Rights

The U.S. proposal is to increase the obligations of the WTO's agreement on intellectual property rights in ways that will require the other FTAA countries-but not the United States- to revise their domestic laws. The proposed changes would override existing protections of indigenous peoples and local communities as well as international environmental and human rights protocols. The U.S. position would tighten the protections for the pharmaceutical and agri-chemical companies in ways that may slow the development of and access to affordable drugs.

Dispute Resolution

As in NAFTA, the U.S. position is to allow only governments to initiate the dispute resolution process against other governments (although an exception is made for corporations in the investment chapter). A better system would allow private parties, such as victims, to initiate a complaint against corporate violators as well as governments. The sole remedy under the proposed dispute resolution process is to limit a violating country's FTAA benefits. The process provides no incentives for corporations to comply; nor does it address the possibility of providing positive incentives, such as financial assistance, to enable governments to comply. Even if the dispute resolution provisions were greatly improved, it will do little good if the rights of workers and environmental issues are not adequately addressed by the FTAA.

Gender Perspective

The agriculture proposal ignores the issue of food security, a key concern for women living in poverty in the region. It also ignores recommendations to allow countries to provide special protections for small farmers (30 to 40 million Latin American women are responsible for their household's farming activities). The U.S. proposal on government procurement does not allow an exception for women-owned businesses, despite a positive U.S. record of using government contracts to support businesses owned by women. In the intellectual property rights summary, the USTR fails to address the issue of traditional/indigenous knowledge, meaning that craft workers, 70 percent of whom are women, have no way to protect their products from being patented by corporations that would then hold exclusive marketing rights. The U.S. proposal's failure to call for a carve-out for health, education and other social services opens the door for privatization programs that are likely to result in layoffs and cuts in services that will disproportionately affect women


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