FTAA negotiations stalled, but U.S. negotiating efforts intensifying--study

January 13, 2005

With the January 1, 2005 deadline for concluding a Free Trade Area of the Americas (FTAA) over, hemispheric negotiations are at an impasse.  But the U. S. administration continues to aggressively pursue the FTAA model through sub-regional and global negotiations, concludes a study released today by Public Services International and the Canadian Centre for Policy Alternatives.

“Divide and Conquer: the FTAA, U.S. Trade Strategy and Public Services in the Americas,” warns that, whatever forum they are negotiated in, FTAA-style treaty restrictions over services, investment, intellectual property and government purchasing would dramatically reduce the sovereignty of governments and their ability to regulate in the public interest.  Contrary to official assurances, such treaty restrictions create intense pressure to privatize, deregulate and erode public services, the study shows.

To date, the U.S. has free trade agreements in place or under negotiation with every country in the hemisphere except Brazil, Argentina, Uruguay and Paraguay, Bolivia and the Caribbean nations.  The Brazilian and Venezuelan governments are strongly opposed to U.S. plans for a hemispheric treaty. “But rather than rethinking this deeply flawed model, the US administration and its corporate allies have turned to smaller, weaker countries where they can more easily get their way” stated co-author Scott Sinclair, a senior researcher with the Canadian Centre for Policy Alternatives.

The report includes case studies indicating how sub-regional treaties such as the recently signed U.S.-Central American Free Trade Agreement (CAFTA) are unbalanced and will harm social progress: “If the CAFTA is implemented as planned, Costa Rica’s much-admired public health insurance system will become more like the unjust and inefficient private American model, reversing decades of hard-won social progress,” said Sinclair.  

The study also examines the impacts of investor-state disputes against Argentina, under bilateral investment treaties, in the wake of that country’s 2001 financial crisis, and Mexico’s loss of hundreds of millions of dollars in international long-distance revenues needed to provide basic telecommunications services to rural and impoverished Mexicans, as a result of a recent WTO dispute settlement ruling.

‘Competitive liberalization’ is the U.S. administration’s effort to set legal precedents that can then be replicated and expanded in each succeeding negotiation.  “It operates on the premise that, once a government has signed an agreement with the U.S., there is little point in opposing similar provisions and commitments in the FTAA talks or in WTO negotiations,” explained Ken Traynor, the study’s co-author and a researcher with the Canadian Environmental Law Association.


For more information contact:
Kerri-Anne Finn, CCPA Communications Officer, 613-563-1341 x306.

The full study is available from CCPA at http://www.policyalternatives.ca or from Public Services International at http://www.world-psi.org/interamericas. The Canadian Centre for Policy Alternatives is a national economic and social policy think tank.  PSI is a global labor federation, representing over 20 million public service workers in more than 600 affiliates unions around the world.