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Cuba-Venezuela-Bolivia: The Trade Treaty for the People (TCP)
An initiative more political than commercial when the Andean Community is in a total crisis.
Author: Christian Galloy
Political Analyst, Director of LatinReporters.com
Freely translated by Anoosha Boralessa (October 2015). Not reviewed by bilateral.org or any other organization or person.
LA PAZ / MADRID, Friday 28 April 2006 (LatinReporters.com) – The Trade Treaty for the People " (TCP) that the presidents Fidel Castro (Cuba), Hugo Chavez (Venezuela) and Evo Morales (Bolivia) signed this weekend at Havana is more about politics than trade. It intends to go against the free trade agreements that Colombia and Peru (where presidential elections are going to be held) signed with Washington and to stop the ratification of these agreements that cause cracks to appear in the Andean Community.
On 19 April, Hugo Chavez announced that Venezuela was withdrawing from the Andean Community of Nations (CAN). This triggered this political-trade bloc of five countries (Venezuela, Colombia, Ecuador, Peru and Bolivia) counting 120 million inhabitants and covering a third of South American trade, to plunge into a crisis.
The Venezuelan President would only go back on his decision if Colombia and Peru froze their free trade agreements with the United States, in anticipation of parliamentary ratification. The outgoing President of Peru, Alejandro Toledo sees it as "inadmissible blackmail". Its External Trade Minister, Alfredo Ferrero, adds that "the United States represents 30% of our market and 40% for Colombia and Ecuador. The rest of us - we don’t have oil".
In Bolivia, Evo Morales claimed “for sure, the TCP will be a new hope for the people and it will recover the basic principles of CAN, namely, to take care of its regional market [Andean] and strengthen its economies".
David Choquehuanca, the Bolivian Minister for Foreign Relations, specified that the TCP is not restricted to a trade agreement. He considers that it has to be considered as "a space for integration" in the framework of the Bolivarian Alternative for the Americas (ALBA) launched by Hugo Chavez to present an alternative to the FTAAs (the Free Trade Area of the Americas, which the American President George W. Bush would like to establish from Alaska to la Terre de Feu.
Minister Choquehuanca, indicates to the Bolivian newspaper, La Razon, that "the TCP has to take into account cultural diversity, equity, the right to development that our people are claiming ... at issue is a type of political and economic relationship that is very different from those provided by FTAAs and the FTAs [free trade agreements]".
In addition, the head of Bolivian Diplomacy assures that this Trade Treaty for the People signed at Havana, will remain open to those countries that would like to join in.
Uneasy, the President of the Bolivian Chamber of Exports, Clover Paz, considers that the decision of the President Evo Morales to sign the TCP "is much more a political decision than an economic decision". He requests the Head of State to first attempt to ensure the survival of the Andean Community.
In 2005, official statistics indicate that Bolivian exports to Cuba rose to only 5,291 dollars, against more than 300 million dollars to the United States and 466 million to the other countries of the CAN.
Mabel Azcui, correspondent at La Paz for the pro socialist Spanish newspaper El Pais, writes that in the city of El Alto, the big, popular and industrial satellite of La Paz, 120,000 jobs depend on exports to the US. Thousands of artisans and single-family businesses of El Alto have, like the Bolivian managerial organisations, demanded from the government of Evo Morales the signature of a free trade treaty with Washington.
Conceived by Chavez, Morales and Castro as an alternative to free trade agreements with the United States, the Trade Treaty for the People is launched while the presidential election campaigns in Columbia and Peru are in full swing.
The Conservative Colombian president, Alvaro Uribe will try on 28 May to follow on from his first term. Probably on this same date, at Peru, an ally of Hugo Chavez and Evo Morales, the nationalist ex-officer Ollanta Humala, will meet the social democrat Alan Garcia at the second round of the presidential elections.
In Colombia and still more in Peru, there is significant popular opposition to free trade with the Untied States. The media impact of signing the TCP at Havana will strengthen this opposition and will influence the results of the two presidential elections by projecting to the centre stage of the electoral campaign, the agreements with Washington, whose ratification, because of this, risks becoming more uncertain.
There, the “Bolivarian” trio Chavez-Morales-Castro play possibly the master card, Bogota and Lima being today the main capitals allied to the United States,in South America (not to be confused, notably on the political level, with the much bigger entirety that is Latin America).
In the event of victory in the Peruvian presidential elections, Ollanta Humala would probably “freeze” the free trade agreement. His social democrat rival, Alan Garcia, is indignant at Hugo Chavez’s claim "to prevent us from doing business with the United States, Venezuela exports 50 billion dollars of oil per year to the US".
The second round of the Peruvian Presidential elections will be an unprecedented combat between the two leftist movements that currently dominate South America. Namely, according to Alan Garcia, a Left of the “Castrists” and “Chavists” represented by Ollanta Humala, against a “Social-Democrat” Left that govern Brazil through Luiz Inacio Lula da Silva, Argentina through Nestor Kirchner and Chile through Michelle Bachelet.