A Public Citizen Primer on the FTAA

by Public Citizen

The Free Trade Area of the Americas (FTAA) is the formal name given to a massive expansion of the North American Free Trade Agreement (NAFTA). The FTAA has been negotiated in secret by trade ministers from 34 nations in North, Central and South America, and the Caribbean.

The FTAA's goal is to impose NAFTA's failed model of increased privatization and deregulation throughout the hemisphere. With a population of 800 million and a combined GDP of $11 trillion, the FTAA would be the largest free-trade zone in the world.

The FTAA would speed NAFTA's "race to the bottom." Under the FTAA, companies seeking tariff-free access to US markets could pit exploited workers in Mexico against even more desperate workers in Haiti or Guatemala.

Eight years into NAFTA, Mexican poverty rates soared to 70 percent. Some 90 million Latin Americans are now indigent, 105 million have no access to health care and at least 19 million children labor in terrible conditions.

Since NAFTA's passage, an estimated 395,000 US jobs have been lost as companies relocated to Mexico to take advantage of lower wages and weaker labor standards. Since 1996, the use of pesticides and fertilizers in Mexico has tripled. Every day, 44 tons of hazardous waste are disposed of improperly. Birth defects have increased dramatically.

The Roots of FTAA
US officials organized the first Summit of the Americas in Miami in December 1994. Trade ministers from every country in the Western Hemisphere (except Cuba) agreed to launch negotiations to establish a hemispheric free-trade deal.

You would never know it from news reports, but since late 1999, FTAA working groups have been meeting every few months to lay out their countries' positions and develop treaty language.

While neither Congress nor the White House is offering any oversight, a variety of corporate committees are actively advising the US negotiators. More than 500 corporate representatives have security clearance and access to the FTAA's secret documents.

Non-governmental civil society organizations have demanded that the FTAA negotiations include working groups on democratic governance, labor and human rights, consumer safety and the environment. These requests have been rejected.

What Will the FTAA Do?
Because negotiations are occurring in secret and no texts have been made publicly available, we cannot know the details of the draft text. However, our conversations with the US trade representative have given us some clues about what to expect once a final agreement is unveiled - once it's too late to change!

Under the FTAA, transnational corporations will be encouraged to take over the operation of hospitals, dental care, child care, elder care, museums, libraries, architecture, insurance, publishing, broadcasting, and legal services.

The FTAA will contain a series of commitments to "liberalize" education, energy, environmental services, and even access to water. NAFTA's creators have long envisioned establishing a continental for-profit water market. By 2015, more than half the world's countries will face severe water shortages. Commercializing this free, natural resource will only worsen the situation.

Privatizing schools and prisons would open the door to greater corporate control, corruption and the temptation to cut critical corners (such as health care for inmates and upkeep of school facilities). The responsibilities of the US Postal Service would be handed over to for-profit firms like FedEx, which could send postal rates through the roof.

Two US health care giants, Aetna International and American International, have already invaded Latin America and are expanding at an annual growth rate of 20 percent. Under the FTAA, this process will accelerate the wiping-out of traditional medicine, education and cultural diversity. As one top WTO official explained: "It won't stop until foreigners finally start to think like Americans, act like Americans and, most of all, shop like Americans."

For the first time in any international trade agreement, transnational service corporations would gain competitive rights to provide a full range of government services and would have the right to sue any government that attempted to resist a corporate takeover. Under the FTAA, transnational movie and media corporations could sue any government that continued to subsidize local artists or offered financial support to protect regional culture.

The FTAA would provide a "back door" for the failed Multilateral Agreement on Investment (MAI). The FTAA's "investor-to-state" suits would allow corporations to sue governments to overturn any public health and safety laws that might cut into corporate profits.

NAFTA permits companies to sue governments over any regulations that may potentially limit profits. US-based Ethyl Corporation, for example, forced Canada to pay $13 million in damages and drop its ban on the dangerous gasoline additive MMT, a known toxin that attacks the human nervous system. Similarly, the US-based Metalclad Corp. sued a Mexican state to force the opening of a toxic waste disposal site, claiming that environmental zoning laws constituted an effective "seizure" of the company's property.

Food, Agriculture & GMOs
The "Miami Group" (the US, Canada, Argentina, and Chile) is trying to force all countries to accept biotechnology and genetically modified foods (industries dominated by unregulated US-based corporations such as Archer Daniels Midland, Cargill and Monsanto).

Under the FTAA, farmers would no longer grow food for domestic consumption. Instead, food would be manufactured by corporations for sale to global markets. Food security organizations agree that these technologies actually will increase hunger in poor nations.

As Maude Barlow, a director of the International Forum on Globalization argues, "It is time for a new international trading system based on the foundations of democracy, sustainability, diversity and developmentS.The world of international trade can no longer be the exclusive domain of sheltered elites, trade bureaucrats and corporate power brokers."

The next Summit of the Americas is set for April 18-22 in Quebec City, Canada. The final agreement is to be implemented in 2005. The events in the streets of Quebec could determine whether the FTAA stays on its secret, fast-track schedule.

"When people understand what is at stake," Barlow predicts, "the peoples of the Americas will mobilize to defeat it. That is the fate it deserves."

What You Can Do Call the Capitol Switchboard [(202) 224-3121] and demand that the draft text and related documents be made public. For more information: Public Citizen [www.citizen.org/pctrade/FTAA/ftaahome.html], Alliance for Responsible Trade [www.art-us.org], [www.sierraclub.org/trade], Smash FTAA [www.tao.ca/~kdawg/smashftaa].