bilaterals.org logo
bilaterals.org logo
  1. Negotiations

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

Free trade at the fore of races
25-Sep-2006
Jack Davis remembers the night he left the Republican Party over free trade: Nov. 17, 2003, after he paid $2,000 to meet Dick Cheney at the upscale Park Lane Restaurant in Buffalo, N.Y.
Organizations release monitoring report assessing impact of CAFTA ’free’ trade agreement
13-Sep-2006
Members of Congress, solidarity organizations, leaders of the DC-area Salvadoran community, and student and faith-based groups held a press conference to announce the release of a report monitoring the effects of the US-Dominican Republic Central America Free Trade Agreement (DR-CAFTA).
Monitoring report: DR-CAFTA in Year One
13-Sep-2006 Stop CAFTA Coalition
Over the past four months members of the CAFTA Monitoring Working Group have coordinated the drafting of this report with friends and allies in Central America. While it is far too early to detail long-term trends in labor, textiles, agricultural practice and policy, investment patterns, services, and environmental consequences of CAFTA, in this report we have looked primarily at the process of implementing CAFTA since January 1, 2006 and some early trends and concerns that have emerged, many of which we will continue to monitor.
Official warns DR-CAFTA could displace thousands of local dairy farmers
9-Sep-2006
Approximately 58,000 small and medium-size milk cattle owners of 10 or less milk cows would be displaced from the Dominican market as the DR-CAFTA trade accord is implemented with Central America and the United States, according to Agriculture Planning deputy minister.
Free Trade would be launched in January to avoid jeopardizing agro
8-Sep-2006
The Dominican government will inform United States authorities as to how it prefers to handle export guidelines that are expected to enter the country en masse, should the DR-CAFTA be implemented before year’s end.
Dominicans contract Colombian scientist for DR-CAFTA training
6-Sep-2006
A Colombian scientist in forensics and populations is in the country to undertake an ample training program in advanced molecular biology techniques with a view to creating human resources capable of genetically categorizing the various agriculture crops destined for export in light of the DR-CAFTA trade accord soon to be implemented.
Implementing Free Trade before 2007 forces hefty agriculture imports
6-Sep-2006
The possible implementation of the Free Trade Agreement with the United States before the year ends will compel the Dominican Republic to authorize hefty import quotas of products in the agribusiness sector, and which could cause an exceeding supply that may jeopardize local producers.
Express fear on doorstep of Free Trade
31-Aug-2006
The Newscasters and Radio and TV Producers guild considered that the Free Trade Agreement signed by the country with Central America and the United States will jeopardize the sector and will affect the population’s possibility to receiving reliable information.
Companies eye pull-outs if CAFTA flounders
28-Aug-2006
Weary of the snail’s pace ratification process of the Central American Free Trade Agreement (CAFTA), which continues to dominate Costa Rica’s political and social agenda, some companies are weighing the idea of moving to other Central American countries should Congress reject the treaty.
Dominican Free Trade delegation is off to Washington
10-Aug-2006
A Dominican delegation of Government officials left for Washington yesterday, to give the finishing touches to the proceedings so that the country enters the Free Trade Agreement with the United States and Central America.