New Oxfam Report "From Cancun to Miami: The FTAA Threat to Development in the Hemisphere"

Posted: 13 November 2003

The US is using negotiations on the Free Trade Area of the Americas agreement (FTAA) in an attempt to impose unfair trade rules that will reinforce poverty, exacerbate global inequalities, and damage multilateralism, warns Oxfam today in a report released ahead of the Miami FTAA ministerial.

Oxfam's report condemns the proposed FTAA. The proposed agreement will repeat the mistakes of the NAFTA trade agreement through liberalization of agriculture, investment deregulation and unjust intellectual property rules, and do nothing to reduce poverty. The US is pushing negotiations toward an agreement on intellectual property rights and investment while refusing to limit or stop its agricultural subsidies; a component that developing countries are resisting.

"After ten years of NAFTA, 45 million Mexicans live on less than $2 a day and rural poverty has increased. Despite an increase in exports and foreign investment, Mexico's poor have reaped none of the benefits," says Phil Bloomer, Oxfam International Trade Campaign Manager. "The FTAA will be nothing short of a disaster."

Since the US failed to impose its agenda upon developing countries in Cancun, it has denounced the multilateral system and has pursued an aggressive strategy of individually applying pressure to poor countries. Since September, many Latin American members of the G20 that formed in Cancun have come under intense pressure from the US to leave the group ahead of the FTAA negotiations.

During the past weekend US officials held closed-door talks in Washington to avert a breakdown in negotiations in Miami by limiting the agenda for the upcoming ministerial.

"The US is using strong-arm tactics that will not produce an agreement that promotes development," says Bloomer. "The US is ready to stitch up its poorer neighbors and bully them into signing up to an agreement that won’t benefit them in the long run."

Oxfam's report states that an increase of agricultural liberalization as proposed in the agreement would make small farmers even more vulnerable to the dumping of highly subsidized products from the US. Oxfam is proposing fair rules for agriculture that put an end to "dumping" and to trade-distorting domestic support and enable programs that give special consideration to small producers and food security.

The report also argues to eliminate the investment rules that favor the interests of large corporations. As seen in the case of Mexico, the investment boom has had little qualitative impact on economic and social problems. The rules of investment under NAFTA, as repeated under the FTAA, have limited the possibility to regulate investment, resulting in poor linkages with national production chains.

Access to affordable medicines for poor countries is another issue highlighted by Oxfam. Recent negotiations have seen developing countries placed under enormous pressure to accept a flawed deal. At Miami, the primacy of public health over patent rights must be asserted and intellectual property rules dropped all together from regional discussions on integration.

Finally the report recommends an alternative approach to regional integration instead of the one-size-fits-all approach proposed by the FTAA. Oxfam's report argues that integration should target regional development and poverty reduction needs with mechanisms for cooperation to compensate the enormous inequalities between the countries in the hemisphere. Furthermore, intra-regional trading arrangements between developing nations such as the MERCOSUR or CARICOM should be encouraged.

Read the report: From Cancun to Miami: The FTAA Threat to Development in the Hemisphere