In 2005, then-Senator Barack Obama published an opinion piece in the Chicago Tribune entitled “Why I oppose CAFTA.” In his article, released on the same date as the Senate vote on the Dominican Republic-Central American Free Trade Agreement (“DR-CAFTA”), Obama explained that he would not vote for the bill and voiced his opinion that DR-CAFTA “…does little to address enforcement of basic environmental standards in the Central American countries and the Dominican Republic.”1 Despite well-founded fears about the consequences of DR-CAFTA among its critics, President George W. Bush and his administration lobbied heavily for the passage of the bill, which was signed into law on August 2, 2005. El Salvador became the first of the Central American nations to implement DR-CAFTA after the treaty took effect in the country on March 1, 2006.

Like the North American Free Trade Agreement (“NAFTA”), the treaty that DR-CAFTA is based upon, DR-CAFTA’s Chapter 10 includes extensive investor rights provisions. These clauses, ostensibly designed to encourage foreign investment, in fact allow multinational corporations to avoid negotiations with individual governments and instead to settle investor disputes with an international tribunal. The first of such cases adjudicated under DR-CAFTA began when Pacific Rim Mining Corporation (“Pacific Rim”*), a Vancouver-based gold exploration company, filed a petition calling for arbitration proceedings against the government of El Salvador for allegedly failing to grant exploitation permits in accordance with the mining laws of El Salvador. The corporation hopes to receive a compensatory payment totaling at least US $77 million, the amount of money it claims to have lost while waiting for its mining permit to be issued. The case will have alarming implications in the event that the international tribunal rules in favor of Pacific Rim against the government of El Salvador: in addition to the staggering cost that would be imposed on the country, the case could set a precedent for other private companies looking to settle cases in international venues that they presume would be more sympathetic to their cause. …Continue Reading »

• The Panamanian President’s anti-labor law delivers killer blow on Panamanian workers and sparks protest and citizen unrest
• The administration attempts to quiet discontent through physical repression, detainment of journalists, and the declaration of a “National Dialogue” to discuss the law’s most controversial provisions
• Martinelli holds talks with Honduran President Porfirio Lobo about importing 5,000 Honduran guest workers to replace striking Panamanians
• Pending Free Trade Agreement with the U.S. could further infringe upon labor rights

On June 12th, the Panamanian National Assembly passed Law 30, nicknamed by critics the “chorizo law,” for what they perceive to be an excess of political pork stuffed into one omnibus piece of legislation. As Panamanians have learned more about the controversial legislation, and particularly those provisions that greatly curtail the influence of organized labor, angry street protests have erupted, and the government has reacted harshly and recklessly, straining democratic principles in the process. From violently suppressing labor protestors and detaining journalists, to endeavoring to replace striking laborers with Honduran guest workers (“strike breakers”), the past several weeks have revealed President Ricardo Martinelli’s penchant for arrogance and impetuousness at the expense of his fellow citizens. …Continue Reading »

• Argentine president Cristina Fernández recently travelled to China to attempt to solve the soy oil controversy between the two countries. For weeks, China has been blocking the commodity from entering the country in retaliation against anti-dumping measures that Argentina has applied against Chinese imports.

After months of delay, President Cristina Fernández Kirchner of Argentina traveled to China on July 11th to discuss economic issues affecting the two countries. China is Argentina’s largest commercial partner after Brazil. The primary purpose of this meeting was to convince China to lift the now two-month blockade against Argentine soy oil. However, the most significant occurrence of the meeting was the signing of an investment agreement that will boost mining and railroad infrastructure in Argentina through the import of Chinese goods. Though this is seen as a successful agreement in terms of Argentine interests, both countries, but especially Argentina, are suffering from the ongoing soy oil dispute. …Continue Reading »

• More people eat bananas than apples and oranges combined
• Bananas are one of Guatemala’s five main export items
• Guatemala is the second most dangerous country in Latin America for trade unionists (July 2009, International Trade Union Confederation)

“Tell me what you want me to do, and I will do it”

The banana outsells apples and oranges combined.1 Ubiquitous in homes and supermarket shelves throughout the United States, the cultivation and distribution of bananas entails a grim reality of cartels, unions, and governments entangled in human rights abuses, price wars, and trade disputes. This is a familiar setting where the strong international buyer rules over the weak provincial seller. In Guatemala, for example, deeply entrenched multinational companies (MNCs) have continuously dominated trade while disadvantaged banana campesinos since the early 1800s have labored under miserable conditions and for wretched pay. This has prevented a truly free market in which farmers and workers would be allowed to bargain in good faith or with the same freedom and privileges as the MNCs. …Continue Reading »