• Costa Rica Real Estate

El Salvador Enters CAFTA, Nicaragua Eyes April

March 3, 2006

GRANADA, Nicaragua – El Salvador’s Minister of the Economy, Yolanda de Gavidia, told The Nica Times this week that El Salvador had not ceded any last minute concessions to the United States in order to be the first Central American country to enter into the U.S.-Central American Free-Trade Agreement (CAFTA) on March 1, despite some recent rumors that Uncle Sam had requested a renegotiation of terms.

According to a Feb. 20 article in the Costa Rican financial newspaper El Financiero, El Salvador had agreed to U.S. requests to modify mechanisms of the regional trade pact related to agricultural imports on sensitive items, such as yellow corn, rice, and dairy products, as well as terms of sanitary controls on meat imports.

The article also implied that Honduras, Nicaragua and Guatemala would have to analyze similar last-minute modifications to appease the United States and enter into CAFTA during the first semester of 2006.

“Whoever said that the free-trade agreement with the United States cannot be renegotiated appears to be wrong,” the article boldly stated.

As it turns out, he who appears wrong is the author of the article.

“This report is incorrect and only contributes to the confusion that some people have wanted to create about the possibility of renegotiating CAFTA,” reads a statement released Feb. 27 by three of Costa Rica’s former Trade Ministers, including Alberto Trejos, who represented Costa Rica during the CAFTA negotiations.

El Salvador’s Minister of the Economy concurs.

“El Salvador did not cede anything to the United States,” de Gavidia insisted. “Remember that once the treaty is negotiated and signed, it can’t be changed.”

What El Salvador has been doing, the minister explained, is to adapt its national legislation to specific requirements agreed to in CAFTA.

Nicaragua is also in the process of adapting its legislation, specifically that pertaining to intellectual property rights (NT, Jan. 13). Though Nicaragua had hoped to have the law passed by this week in order to enter into CAFTA on March 1, the slow start to the legislative year has pushed back the probable start date to April 1.

In Guatemala, meanwhile, college students, unionists and vendors took to the streets Feb. 24 for the latest in a series of anti-CAFTA protests.

“We denounce the free-trade treaty for the harm it will inflict upon the great majority of Guatemalans, while only benefiting the government and a few business owners,” said Luis Lara, leader of the National Fighting Front, the group that organized the march.

The demonstrators, who numbered roughly 3,000 according to Lara, marched down a major thoroughfare on the capital’s south side, stopped in front of the U.S. Embassy to burn an American flag and fastfood containers from U.S.-based chains, then continued on to the historic center of Guatemala City.

U.S. trade officials are asking the Guatemalan government to carry out legal reforms to open the way for implementation of the CAFTA pact, which is tentatively scheduled to go into effect for Guatemala on June 1.

In Washington, D.C., U.S. Trade Representative Rob Portman said that the United States will continue working with the other signatory nations, following the March 1 start date with El Salvador, so that the agreement can go into effect in a “complete and opportune” way.

CAFTA was signed in 2004 by the United States, Guatemala, Honduras, El Salvador, Nicaragua, Costa Rica and the Dominican Republic. It has been ratified by all countries except Costa Rica.

 

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