bilaterals.org logo
bilaterals.org logo

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
Photo: Public Citizen


Guatemala and the United States commence arbitration
45 days after putting into motion an arbitral panel for violation of labour rights, the Office of US Trade Representative (USTR) will today present the basis for its claims against Guatemala under CAFTA-DR.
Honduras near ’failed state’ status due to free trade agreement, says labor and Latino leaders
Labor leaders say CAFTA-DR has had a negative impact on Honduran farmers and resulted in displaced workers, "total break down of public services" and "forced migration" of youth, while the US spends billions to deport "hundreds" back to the Central American country in shackles.
The carrot, the stick, and the seeds: US development policy faces resistance in El Salvador
While the seeds dispute was an effective rallying point, social movements must confront the elephant in the room – CAFTA.
Guatemala: activists defeat ’Monsanto Law’
The law was originally passed to comply with an intellectual property requirement in the 2004 Dominican Republic-Central America Free Trade Agreement (DR-CAFTA), and it was unclear whether Guatemala might now be excluded from the US-promoted trade bloc.
Guatemala repeals plant breeder rights law
The Congress of Guatemala has repealed the controversial "Monsanto Law" which legalised property rights on plant varieties in accordance with CAFTA.
Guatemala: Under pressure from social movements, Justice temporarily suspends part of the "Monsanto Law"
Guatemala’s Constitutional Court has suspended the so-called "Monsanto Law" which was support enter into force, as an obligation under the US-Central America free trade agreement (CAFTA), on 26 September 2014.
Guatemalan court suspends "Monsanto Law"
Guatemala’s Constitutional Court has provisionally suspended the entry into force of the controversial "Monsanto Law" required by CAFTA to legalise property rights over plant varieties
Guatemala: People reject "Monsanto Law" for threatening food security
Guatemalan civil society has strongly rejected the country’s new plant breeders’ rights law imposed through the free trade agreement with the US (CAFTA).
US trade officials give Guatemala more time to install labor overhaul
US trade officials on Monday said they would give Guatemala more time to implement a labor rights enforcement plan under CAFTA.
CAFTA investor rights undermining democracy and the environment: Pacific Rim mining case
Pacific Rim Mining Corp., a Canadian-based multinational firm, sought to establish a massive gold mine using water-intensive cyanide ore processing in the basin of El Salvador’s largest river, Rio Lempa.