America's Plan for the Americas
from Stop FTAA website http://www.stopftaa.org/
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
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.
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.
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