Opponents see DR-CAFTA as nothing more than a consolidation of the economic reform and structural adjustment policies imposed over the last two decades and fear that it will only serve to exacerbate Costa Rica’s development problems: further incapacitating the state and removing the country from existing within its own particular sovereignty and resource framework, until it becomes ‘just another cog in the wheels of the global economy… increasingly controlled by giant corporations and international financial markets’. 20
Citing the failures of NAFTA in Mexico, they claim that the agreement will undermine the Constitution, encouraging a society based on survival of the strongest in which the only sure winners are huge transnational companies and where poverty, income inequality and social exclusion are intensified.
Although oppositional forces have unified in expressing generalized dissatisfaction towards the agreement, particular objections have been extensive and diverse.
Analysts and small business owners fear that as tariffs on the imports of US manufactured goods and agricultural products are dropped, even more independent businesses and farmers will be squeezed out, unable to compete on economies of scale. Despite the Arias Administration’s efforts to counteract this through micro-financing iniatives for SMEs protestors claim that these are insufficient and that the trade pact will encourage further dependency on foreign imports, depressing domestic industry, in turn raising inflation rates, trade deficits and unemployment.
It has also been suggested that although Arias has pledged to fortify links between foreign owned export industries and the local commercial fabric, provisions within the CAFTA text to attract investment will actually further weaken these links. These stipulations will prohibit the governments of Central American countries from implementing policy tools requiring that investors use local materials, labor and small businesses for example, currently used to ensure maximum benefit to local communities and promote sustainable, domestic development.
The labor unions have their own specific concerns, primarily focused around the fear that the competition from poorer countries will threaten the country’s labor standards in what is often referred to as the,’ race to the bottom’ in terms of employment costs, rights and instability.
Members of ANEP, the National Association of Public and Private Employees and FIT, the Costa Rican Electricity Institute’s union object to proposals to privatize the national telecommunications and insurance systems and open them up to competition, fearing that once privatized these institutions would respond only to the needs of the market rather than the people, resulting in reduced, deregulated services, job losses and salary cuts.
Protests from UNDECA, the workers union for Costa Rica’s social security system (caja) have centered for the most part on DR-CAFTA’s provision outlining ‘test data exclusivity’ for pharmaceutical companies. This will extend patents on new drugs enabling companies to hold an effective market monopoly, inhibiting the production of much lower cost generic drugs, including those used to treat Aids, malaria and tuberculosis, thereby reducing access to these medications and threatening the ability of the caja system to provide adequate care for its people.
Meanwhile environmental protestors have drawn attention to stipulations in the agreement’s investment chapter which grant foreign corporations the power to legally challenge government legislation before private, international tribunals.
Under these new rules companies will be able to file suit against national and local laws that cut into their future profits even if these are enacted for legitimate public safety and environmental protection objectives, on the grounds that these constitute unfair barriers to trade. Protestors anticipate that this could have serious consequences for conservation, threatening the country’s extensive legislation and endangering its environmental industries.
Although oppositional forces have unified in expressing generalized dissatisfaction towards the agreement, particular objections have been extensive and diverse.
Analysts and small business owners fear that as tariffs on the imports of US manufactured goods and agricultural products are dropped, even more independent businesses and farmers will be squeezed out, unable to compete on economies of scale. Despite the Arias Administration’s efforts to counteract this through micro-financing iniatives for SMEs protestors claim that these are insufficient and that the trade pact will encourage further dependency on foreign imports, depressing domestic industry, in turn raising inflation rates, trade deficits and unemployment.
It has also been suggested that although Arias has pledged to fortify links between foreign owned export industries and the local commercial fabric, provisions within the CAFTA text to attract investment will actually further weaken these links. These stipulations will prohibit the governments of Central American countries from implementing policy tools requiring that investors use local materials, labor and small businesses for example, currently used to ensure maximum benefit to local communities and promote sustainable, domestic development.
The labor unions have their own specific concerns, primarily focused around the fear that the competition from poorer countries will threaten the country’s labor standards in what is often referred to as the,’ race to the bottom’ in terms of employment costs, rights and instability.
Members of ANEP, the National Association of Public and Private Employees and FIT, the Costa Rican Electricity Institute’s union object to proposals to privatize the national telecommunications and insurance systems and open them up to competition, fearing that once privatized these institutions would respond only to the needs of the market rather than the people, resulting in reduced, deregulated services, job losses and salary cuts.
Protests from UNDECA, the workers union for Costa Rica’s social security system (caja) have centered for the most part on DR-CAFTA’s provision outlining ‘test data exclusivity’ for pharmaceutical companies. This will extend patents on new drugs enabling companies to hold an effective market monopoly, inhibiting the production of much lower cost generic drugs, including those used to treat Aids, malaria and tuberculosis, thereby reducing access to these medications and threatening the ability of the caja system to provide adequate care for its people.
Meanwhile environmental protestors have drawn attention to stipulations in the agreement’s investment chapter which grant foreign corporations the power to legally challenge government legislation before private, international tribunals.
Under these new rules companies will be able to file suit against national and local laws that cut into their future profits even if these are enacted for legitimate public safety and environmental protection objectives, on the grounds that these constitute unfair barriers to trade. Protestors anticipate that this could have serious consequences for conservation, threatening the country’s extensive legislation and endangering its environmental industries.
