Ecuador decides: Faced with free trade, free determination of its people
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Ecuador decides: Faced with free trade, free determination of its people
posted 16-September-2004
Freely translated by Anoosha Boralessa (November 2015). Not reviewed by bilaterals.org or any other organization
Altercom.- The free trade treaty that the US proposed to Ecuador and other countries in the Continent following the failure of the Free Trade Area of the Americas (FTAAs) and the World Trade Organization negotiations, is not exclusively a trade treaty; it addresses all facets of the economic, political and cultural life of our peoples. It is not a treaty rather a supra-norm that would be hierarchically superior to the Constitution and would govern the destiny of our country at least for the next twenty years. The issue is universalizing the laws that govern in the US.
This proposal cannot be treated hastily and without careful thought. As the future of thirteen million Ecuadorian men and woman and the next two generations are at stake, what is required at the very outset is a calm study where all institutions of the country participate, the people are consulted and a national agreement constructed.
The negotiation has been secretive and exclusive. Until now, our country did not have a Spanish text of the draft and the texts are not accessible to citizens. In the Lima round, the US imposed three conditions:
Reservations;
A carve out for treatment of agricultural subsidies; and
The urgency of deadlines.
Several social organizations in this country consider the conduct of the Government of Ecuador has been risky for the interests of the country. Such organizations include:
the Latin America Association of Pharmaceuticals;
the National Chamber of Microempresa;
Comité Interuniversitario against FTAA – FTA;
Comunidades Eclesiales de Base;
Confederación de Barrios del Ecuador;
Consejo Latinoamericano de Iglesias;
Coordinadora Nacional de Estudiantes Universitarios y Politécnicos;
Coordinadora de Movimientos Sociales;
Federación Nacional de Judiciales del Ecuador;
Federación de Trabajadores de Petroecuador;
Foro Ecuador Alternativo;
Frente Nacional de Defensa de los Jubilados;
Jubileo 2000; and
Junta Nacional de los Artesanos y Servicio Paz y Justicia.
According to this collective group, the spokesmen, led by the Trade Minister, have not only declared that an FTA urgently needs to be signed; they have touted the merits of the offers of free trade. Such spokesmen represent the interest of a small group of managers, importers and bankers that would profit at the expense of most manufacturing and social sectors suffering.
The regime, instead of generating a healthy space for debate and agreement, has developed a strategy of silence and secrecy; of co-opting one or two representatives in each sector to declare citizens support, claiming to divide the productive and social sectors of the country; and sectorial negotiation, preventing the vision and treatment of the national interest.
The organizations are conscious that it requires a firm and united response from productive, social and civil organizations faced with a weak government that has barely 4% support.
“We have to start from a basic agreement: the Free Trade Agreement cannot be determined by the Government and Congress behind the people’s backs. Any final decision must be taken in a referendum. Our first agreement is that ECUADOR DECIDES: free trade collides head-on with the free determination of our people. The first step for development is defending our sovereignty”, declared the organizations.
Equitable integration confronts the FTA
Some social organizations in Ecuador believe in the need for regional integration that may be beneficial for all our countries and peoples. The ancient dream of Bolívar is still alive: economic, political and cultural unity of our America is a condition for being able to participate in a global agreement. The objective must be development, well-being and the freedom of our people.
The United States’principal objectives are the following:
To have access to the ownership of the goods and services of our countries;
To eliminate state sovereignty before the claims of North American transnationals;
To eliminate social and environmental controls; and
To achieve total market liberalization for goods and capital, in exchange for controlled trade openings for certain articles of the primary sectors of the economy.
The attempt to appropriate and control is not only targeted at tangible goods, natural resources and state properties, (notably in the telecommunications, oil and mining sectors); but also intangible goods and services, intellectual property and indigenous knowledge, biodiversity, water, education and social security. It claims to commoditize everything that exists so that US norms govern them.
The strategy that the organizations propose against the FTA starts from strengthening national sovereignty, the local market and constructing equitable, regional integration, through active participation in the Andean Community and MERCOSUR, as the foundation and prior condition for hemispheric and global integration. The times must be adjusted to these steps to enable progress in handling inequalities and the construction of an economically and politically integrated South America. Latin American unity is urgently needed and not its submission to North American power.
An FTA? No thanks
If the FTA is set up, it will impact life and production; it will generate fresh spikes in health costs and medicines, due to monopolies of patents and intellectual property and the privitization of health services and social security; it will raise unemployment and under-employment, due to the destruction of the productive base of our country, especially agriculture, livestock, crafts and micro-business. Following an illusory control of inflation by the massive invasion of external products, costs will be imposed according to the interests of triumphant transnational monopolies. The gap between the rich and poor will deepen; on the one hand, a small group of beneficiaries: big traders, notably importers, and bankers, who will be able to agree to privatized goods and services and at high costs; and on the other hand, a huge mass of small and medium-sized managers, impoverished workers and peasants, the unemployed and excluded who will not be able to access their goods, essential services, deprived not only of their daily bread, but of an optimistic future. The FTA jeopardizes life and hope.
According to Joseph Stiglitz, the Nobel Prize Winner and a spokesman from the First World, free trade treaties constitute the “fourth step to hell”, following the elimination of customs, the implementation of international prices and privatizations. The FTA continues a policy that has destroyed our continent.
The illusion that the neoliberal discourse brings up is this: more market freedom means more development. But both history and today’s reality refute it. Development of the big powers, including the United States, has taken place in a strong period of protectionism. Only after obtaining huge advantages prior to their competitors, do powerful countries preach free trade, but for others.
A question: why are countries such as Sub-Suharan Africa or Haiti, that currently have higher levels of openness to free trade, the most backward in the world according to the International Monetary Fund codes. Currently, despite some partial concessions, the US (and the EU) refuse to eliminate protections and subsidies for their farmers and for non-competitive businesses such as stainless steel. In the period 1998 - 2000, subsidies for farmers represent
63% of the agrarian profit in Japan
40% in the EU
23% in the US and
18% in Canada.
Private intellectual property is the complete opposite of freedom of access to resources that should be at the service of humanity, above all, in the health sector. Such resources are appropriated by monopolies that have become increasingly more powerful and selfish.
After NAFTA has been in force for 10 years, the results for Mexico have been negative: after the initial fiction of the creation of 800,000 new jobs, due to the relocation of“maquilador” from the US, hardly 500,000 remain; whilst in agriculture, 1.3 million jobs have been lost and in industry another 700,000. As for salaries, workers with Mexican subsidiaries earn 75% of what their North American counterparts earn. Mexico has been converted into an importer of its staple food: corn. What has increased is inequality: 10% of the wealthiest have increased their proportion of the national income, while the other 90% have reduced their’s or have not experienced any change.
Ecuador has already experienced several chapters of a model that would be further fleshed out with the FTA and that has been a lousy deal:
76% of poverty
12.5% of open unemployment
56% of structural underemployment
12% of migration abroad.
Ecuador cannot even compete with the countries neighbouring it, despite the efforts of many managers. 62% of businesses, according to the Superintendencia de Compañías, are in crisis or bankruptcy. Only the high international price of oil and remittances by migrants maintain the fiction of a 4.5 % GDP growth, while the bases of our economic infrastructure stagnate.
