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US-DR-CAFTA

The US-Central America Free Trade Agreement, commonly referred to as “CAFTA,” was signed in December 2003 after twelve short months of negotiation. The negotiations involved the US, Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua. Costa Rica at first refused to join the agreement, then changed its position in late January 2004. The US separately negotiated a bilateral treaty with the Dominican Republic, with a view to folding the deal, and the country itself, into the US-CAFTA scheme.

The US-CAFTA was signed late May 2004, and the Dominican Republic became an additional party to it in August 2004. Since then, the accord has been officially renamed the “United States-Dominican Republic-Central America Free Trade Agreement” or US-DR-CAFTA. But the overall agreement — which a lot of people continue calling just “CAFTA” — still needs ratification by all parties to go into force.

CAFTA is a wide-ranging agreement covering many areas: agriculture, telecommunications, investment, trade in services (from water distribution to gambling), intellectual property, the environment, etc. It essentially serves US business interests by giving them a concrete and high-level set of rights to operate in Central America. Some US sectors, such as sugar producers, feel threatened by the treaty. But by and large, the threats are mainly against the Central American countries which signed on, as it opens the depths of their economies — public and private — to the interests and power of US companies.

In July 2005, US Congress approved the DR-CAFTA and Bush signed it into law in early August. The Central American parliaments eventually also approved it. For the Dominican Republic, the treaty took effect in 2006.

Costa Rica was the Central American country with the strongest resistance to DR-CAFTA. There were large public demonstrations and information campaigns, and a broad grouping of civil society organizations, from trade unions to small farm organizations, signed on. This coalition successfully pushed for a referendum on ratification, which was held on 7 October 2007. The result: 51.62% in favour and 48.38% opposed. The result was considered binding since more than 40% of the electorate voted. In view of these results, CAFTA was ratified.

On December 23, President Bush issued a proclamation to implement the DR-CAFTA for Costa Rica as of 1 January 2009.

last update: May 2012


Some Latino Groups Oppose Free Trade Agreement, L.A. Times Says
Some Latino groups, such as the League of United Latin American Citizens, oppose the Central American Free Trade Agreement because they say it will export U.S. jobs and lead to the exploitation of Central American workers and the environment, the Los Angles Times reported.
US ITC report on CAFTA
U.S.-Central American-Dominican Republic Free Trade Agreement: Potential Economywide and Selected Sectoral Effects
Costa Rica: Protests bring country to the verge of paralysis
Nationwide protests in Costa Rica that started out with blockades of roads and freeways by truck drivers and which expanded Wednesday to include a broad range of groups threaten to paralyse this Central American country.
CAFTA: Recolonizing Central America
Managua, Nicaragua — "Prices are so low we have to grow more and more just to meet ends." That’s how a leader of a new Nicaraguan campesino organization, FEDICAMP, describes the current situation for small farmers here.
Dominican Republic to join proposed US-Central America trade pact
The Dominican Republic will join a proposed free-trade pact with the United States and five countries of Central America known as CAFTA, US officials said.
FTA: Empowers the rich and weakens the poor
The beginning of the nineties is defined by President Bush (Senior)’s call to establish a united continent for free trade. All countries will become rich by liberalizing their markets. The FTAAs will be a miracle.
Salvadorean opposition urges Congress to reject FTA with US
The Farabundo Marti National Liberation Front (FMLN) and social organizations of El Salvador urged the Congress to reject the ratification of the free trade agreement (FTA) inked with the United States.
Opposition to CAFTA strong in Costa Rica / Oposición a Cafta atrincherada en Costa Rica
Although resistance to a free trade deal with the United States is growing throughout Central America, social activists say the big battle will take place in Costa Rica, where opposition is focused on a proposal to open up telecommunications and insurance to foreign capital.
Stop the Central American Free Trade Agreement!
Our Congressional representatives and Senators will be in their home districts from May 24 to 31. As U.S. citizens we need to hold our elected officials responsible and call on them to vote against the Central American Free Trade Agreement (CAFTA).
Opponents predict defeat for Central American deal
The Bush administration will sign the Central American Free Trade Agreement (CAFTA) with five developing nations Friday, but opposition Democrats and civil society groups predict the deal will fail in Congress.