Unfortunately, not all indigenous groups participating in these working groups felt that the discussions were productive. AIDESEP, a long-time Oxfam America partner and one of the largest federations representing indigenous peoples in Peru’s Amazon, has withdrawn from the dialogue process, citing lack of progress and reluctance on the part of the government to accept its share of the responsibility for the violence in Bagua.

While indigenous people and the government struggle to continue a meaningful dialogue, the Indigenous Federation of Madre de Dios (known as FENAMAD) has been objecting to the presence of Hunt Oil of Texas in the Amarakaeri Communal Reserve (RCA), part of the 3.5 million-acre Block 76 oil concession located in the Madre de Dios region in southeastern Peru. FENAMAD contends that Hunt Oil could be playing indigenous communities against each other to gain access to their lands. “The current strategy of the US company Hunt Oil is to negotiate directly with the members of each native community and seek to divide them and provoke open confrontation among the brother indigenous people within each community,” FENAMAD is saying in a memorandum.

There is a real danger this could emerge as the next flashpoint in a disturbing stream of conflicts between communities and oil and mining companies in Peru. The Peruvian Ombudsman Office estimates that of the 273 social and environmental conflicts in Peru in the first six months of 2009, 80 percent were related to extractive industry projects. (In 2008 there were 123 social and environmental conflicts in the same period.)

FENAMAD and other indigenous federations are insisting that foreign oil, gas, and mining companies must attain the free, prior, and informed consent from communities before they can enter any indigenous lands such as the Amarakaeri Communal Reserve. The right of free, prior, and informed consent is a right of indigenous peoples established under international law, and requires free access to full information (including independent analysis of project proposals), adequate time for a community decision free of pressure and coercion, and the option to reject a proposal--or accept under certain conditions.  

The failure of oil, gas, and mining companies to gain appropriate access to communities with natural resources limits Peru’s ability to benefit from revenues it needs to help the approximately 50 percent of its population now living in poverty.

The legislature gave Peru’s President Alan Garcia broad powers to promote economic competitiveness through decrees last year, saying it was necessary to adapt legislation to comply with new requirements of the Peru-US Free Trade Agreement.  Indigenous federations and many civil society organizations have strongly protested the possible consequences of these laws for the Amazon rainforest and indigenous lands, as well as the fact that they were adopted without transparency or genuine consultation. Some of these legislative decrees were rescinded following violent confrontations last June, but many are still in force.

Oxfam America's campaign—called the Right to Know, Right to Decide—aims to arm local citizens with the information they need to weigh the costs versus the benefits and decide whether to provide consent for the projects to move forward.

“There is a potential for this confrontation to escalate to violence,” says Emily Greenspan, Oxfam America’s policy advisor who monitors oil and gas projects in Peru’s Amazon. “Companies seeking to operate in any areas need to attain the free, prior, and informed consent of communities. Those that appear to be forcing their way into communities risk serious conflict, as we have seen in the recent past.” 

"Resuscitating Doha is essential to right the rigged rules of trade, but what's been simmering on the WTO stove will simply not deliver for poor countries, said Oxfam America president Raymond C. Offenheiser. "The financial crisis, which started in developed countries but is taking its worst toll on developing countries, should be the impetus for a change in course."

In a new report released today called "Empty Promises," Oxfam details how the Doha Round has become an exercise in prying open developing country markets rather than an effort to rebalance decades of unfair agricultural and industrial trade rules. In the midst of a global economic crisis, a food crisis, and a climate crisis, nations with the least blame and with the least capacity to cope with the consequent effects must not have to pay even more to enable their economies to develop, according to the report.

Over 50 million people stand to lose their jobs, remittances are collapsing, and growth in sub-Saharan Africa is predicted to fall by 70 percent this year trapping 90 million more people in poverty, because of the crisis. Food prices meanwhile remain high for poor consumers: by the end of 2008 a further 109 million people had been added to the ranks of hungry, topping 1 billion people worldwide. As the world experiences the sharpest drop in trade in 80 years, a "development" trade deal—as originally promised—remains crucial, according to Oxfam.

"Now is the time for WTO members to come back to the negotiating table, recognize that the current crisis provides an opportunity to address urgent development needs, and change the course of negotiations, much as they did nearly eight years ago in Doha," said Offenheiser. "At this time of desperate need for a change of course, the Doha Round has to step up to deliver on its development promise. There is little credit left for another failure."

The welcome political commitment from the G8 could lead to a fresh start to negotiations, but it cannot be business as usual. In the past eight years, developed countries have used the talks to continue to push to open up new export markets. Developing countries have resisted, saying they were promised a deal that would give them space to protect their farmers and new industries, an end to rich country trade-distorting agricultural subsidies, and more access to rich markets for their farmers and industries.

The widespread food price crisis has shown that food and livelihood security cannot depend solely on market forces. Development, rather than liberalization, has to be the central objective of negotiations and trade rules must respond to the needs of the most vulnerable people first and foremost, according to Oxfam. It is the responsibility of WTO member states to analyze the role of trade in the recent global crises so that the Doha negotiations take into account the new global context and contribute to a solution, rather than exacerbate the problem.

"What's on the table is no silver bullet since it continues to favor the richest and biggest farmers and industrialists in the US and Europe and sidelines the needs of the poor," said Offenheiser. "We have seen what can be done when countries find the resolve to avert problems at home, and this resolve must be translated to the multilateral trade agenda so that the much-needed conclusion of the Doha Round can be achieved in a manner that addresses developing country needs first and foremost."

There are about 200 indigenous Ashaninka people living in this area, but most of them, like 29-year-old Dante Cheresente, are not making much money and therefore can't pay for things like doctor visits when family members fall ill or education for their children. They live off of the fruits and vegetables they grow in their small plots, but these are mostly for their own consumption. "We grow yucca, plantains, lemons, oranges, and tangerines," Cheresente says. "But we just eat most of it and feed it to our animals, because prices are so low it is not worth selling."

To tap into the opportunities of the market economy and make some money, Cheresente and his father, who is the village chief, and others in their community are collaborating with a local rural organization known as SEPAR, Oxfam America's partner in this central jungle region of Peru, to carry out an experiment: growing the ancient Sacha Inchi plant, which yields a nut that is rich in nutritious omega-3 and omega-6 oils.

"There is demand in Peru for Sacha Inchi oil for cooking, but also as a health supplement internationally," says Raul Ho, Oxfam America's program officer in South America. "It is well known now, and the supply is lower than demand, both in Peru and abroad. To meet this demand, we will help indigenous farmers find the right Sacha Inchi variety for their lands and help them grow, process, and sell it in the fair trade market."

Building on strengths

SEPAR is working with farmers like Cheresente all over the central Amazon to plant experimental plots of Sacha Inchi. In San Ramon de Pangoa, they are growing two different varieties, one from the northern Amazon and one from the southern region, to determine which will perform best in the soil and altitude found in their village. "This is being done with indigenous farmers every step of the way," says Ho. "We will help them enter this market with the right seeds and production technology, and the farmers will know the best practices for growing Sacha Inchi." The goal is to produce a high-grade, organic Sacha Inchi, for which the farmers will get the best possible price.

In San Ramon de Pangoa, the rows of Sacha Inchi plants are interspersed with corn, soy beans, potatoes, and other food crops to determine which growing patterns work best. Frank Mendoza, a tropical agriculture expert advising SEPAR, says the Sacha Inchi crop could be quite lucrative. "If we can help these farmers grow Sacha Inchi as just one of their crops, it will increase the income of the farmers considerably," he says. Cheresente and his father, for example, say if they can make decent money from Sacha Inchi, they could devote five of their eight hectares—about 12 of their nearly 20 acres—to growing the plant. Ho and Mendoza estimate that with luck, in their first year they could get as much as 500 kilos of Sacha Inchi per hectare and sell the unprocessed nuts at about seven Peruvian soles (about $2) per kilo. This could mean a gross return of as much as $5,000 per harvest. With the right variety and improved production techniques, farmers like the Cheresentes could eventually produce nearly 1,000 kilos per hectare, which would bring in over $10,000 for unprocessed Sacha Inchi nuts on their five hectares, a huge income boost in a very poor region of Peru.

On their own terms

Cultivating a valuable cash crop like Sacha Inchi can help the indigenous Ashaninka people in villages like San Ramon de Pangoa to connect with local and international markets on their own terms: to earn money and preserve their culture and way of life. Preserving community and the Ashaninka's legacy occupy Cheresente's mind quite a bit these days: he and his wife, Laura, have a two-month-old son, Jason Fritz Cheresente. While his father talks with visitors, Jason Fritz lays in a hammock, quietly sleeping. Attached to the hammock is a string, which his grandmother pulls gently to rock the baby as she talks with friends. She and her generation have witnessed the wholesale occupation of this central jungle region by settlers from the highlands escaping the guerilla war of the 1980s and seeking land and opportunity. The government encouraged this exodus, believing the land was unoccupied, as it ignored the indigenous inhabitants. The result is that the Ashaninka have been squeezed into smaller and smaller areas and can no longer hunt and fish. They are now settled and trying to become part of the larger economy while preserving their culture. Despite these pressures, Cheresente is optimistic that growing Sacha Inchi will help them. "We expect to increase our income, so we can support the elderly people in the community, as they were the ones who worked to get this land. We also want to improve the level of nutrition and education for children here."

Growing Sacha Inchi is just part of this economic integration for the Ashaninka. Others in the village are getting help in producing and marketing handicrafts such as woven bags and traditional garments, as well as souvenirs for tourists. Cheresente's wife even got a grant from SEPAR to open a store, where she sells food, soap, and other consumer goods. Small enterprises like this will help people earn cash they can use to pay for health care and other services. And more small enterprises will help start to move cash through the rural economy.

Growing Sacha Inchi and other money-making ventures in these indigenous communities will help people prosper and maintain their communities. Cheresente and his neighbors have worked hard to get the research plots growing despite a serious drought that set in just after planting last year. They watered the Sacha Inchi plants from a small stream near the village and tended the plots three entire days per week.

Antonio Cheresente, Dante's father, says they are looking to Sacha Inchi for their future. "We know this research will help us improve our farms," he says.

I am writing in regard to the imminent Congressional action on the US-Peru free trade agreement, titled the US-Peru Trade Promotion Agreement (PTPA). Oxfam America believes that trade can be an engine for development and poverty reduction, and we strongly support measures to improve trading opportunities that can reduce poverty. However, we also believe that trade agreements must take into account the economic and social disparities between trading partners and include rules that allow the poor to realize these important potential benefits. Unfortunately, as a recent Oxfam report indicates, the PTPA will cause greater hardship and could undermine development in Peru. For this reason, Oxfam is calling on Members of Congress to oppose this legislation.

The PTPA, as negotiated, will harm many thousands of Peru's small farmers who supply food to their domestic market, as they will be forced into an unfair competition with subsidized US agricultural exports. The agreement will limit access to affordable new medicines in Peru by unduly extending the monopoly rights of the international pharmaceutical industry. The PTPA will also restrict Peru's ability to regulate foreign investment to ensure it serves national development.

Agriculture

More than half of Peru's nearly 28 million inhabitants live in poverty, many of them in rural areas, and the PTPA will adversely affect the livelihoods of many of the poor if passed. Agriculture is the main source of jobs in rural areas, generating nearly a third of all employment nationally. The vast majority of Peru's agricultural production is for domestic consumption. The trade agreement makes permanent the export opportunities that Peru currently enjoys under US trade preference programs and will thereby benefit certain export sectors. Yet barely 8 per cent of Peruvian agricultural production is for export, only one third of which is destined for the US (coffee, as well as non-traditional products such as asparagus and artichokes).

On the other hand, the PTPA will fully eliminate tariff protection on basic crops, which the US International Trade Commission has estimated will lead to large increases in Peru's imports of US basic grains, such as wheat, rice and corn. This means that Peruvian farmers who supply their domestic market will be undercut by heavily subsidized, cheaper US imports that are dumped in Peru below their real cost of production. As a result, there is a risk that many Peruvian farmers who are no longer able to earn a living by producing basic grains will turn to coca cultivation, thereby undermining years of US foreign policy and drug eradication efforts.

It has been suggested that Peru's farmers could be compensated for the loss of their livelihoods. However, Peruvian agricultural leaders have stated that farmers would need close to $1 billion to compensate for their annual losses from the PTPA, nearly 30 times what the Peruvian government has committed to make available. This is also a far less effective way to promote development than providing full and effective safeguards for crops that are vital to livelihoods and food security.

Access to Medicines

The PTPA could lead to significant increases in medicine prices, another issue of major concern for poor people in Peru. Stringent, new intellectual property provisions in the PTPA will restrict generic competition and lead to higher prices for new medicines in Peru. Only half of all Peruvians have health insurance and about one-fifth of the population has no access to health care. Medicines account for one-quarter of all public health expenditures and 44 percent of household spending on health. People living in poverty are, for the most part, not insured and must either pay out of pocket or receive no treatment at all. Given these conditions, any increase in the price of medicines is likely to have significant negative consequences for the

The PTPA will unduly extend monopoly protections for the international pharmaceutical industry, which will mean that fewer Peruvians, particularly the poor, will be able to get the medicines they need. A study commissioned by the Ministry of Health in Peru has shown that provisions in the PTPA will increase the cost of new medicines, and the Health Minister has reported that an increase in public health care expenditures will likely be required in future years. Imposing new burdens on an already cash-strapped health care system will further exacerbate poverty and inequality in Peru. The primacy of public health over private patents has already been well-established at the World Trade Organization (WTO). Yet the PTPA ignores this by restricting the use of public health safeguards allowed under the WTO and requiring adoption of new intellectual property rules that exceed the WTO standards.

Investment

The rules on investment in the PTPA give foreign companies leeway to challenge investment regulations, such as laws to protect the environment and public health. This will undermine Peru's ability to ensure that foreign investment contributes to national development, rather than exacerbating poverty. For example, Peru's Law for the Promotion of the Agricultural Sector grants the farming industry certain tax benefits if at least 90 percent of its inputs are sourced nationally. Under the PTPA, this law could be challenged and potentially repealed. Likewise, efforts to regulate the operation of the mining industry to address its health and environmental effects could be challenged.

Conclusion

While the economic impact of the PTPA on the US is likely to be negligible, the economic and social costs to Peru will be high, especially among the poor. Peruvian agricultural exports to the US will expand little, as noted by the ITC, given that these products have already enjoyed duty-free access to the US market under Andean trade preference programs for the last 15 years. Contrary to promoting stability in Peru and the Andean region, the PTPA is likely to exacerbate the existing problems of poverty and inequality and undermine regional integration and development.

Although the PTPA has been actively promoted by Peru's outgoing president and approved by its lame-duck Congress, there is deep concern among much of Peru's population about agreement. Broad cross-sections of civil society in Peru have actively opposed or questioned the trade agreement. The PTPA was a significant campaign issue in the recent presidential elections, and the winner, incoming President Alan Garcia, campaigned on a promise to closely review the agreement's potential impact and renegotiate it if necessary.

Oxfam believes that in order for trade to truly be "win-win" for developed and developing countries, trade rules should be negotiated under the multilateral trading system at the WTO. The Doha Development Round was launched with the understanding that it would deliver on the promise of development for poor countries. A successful conclusion to these WTO negotiations that provides new opportunities for developing countries will also benefit the US by promoting more stable economies and increased purchasing power in the developing world.

Bilateral trade deals like the PTPA complicate the global trading system and divert efforts to achieve a more valuable global agreement at the WTO. Furthermore, the PTPA includes rules that weaken the ability of Peru to enact policies that reduce poverty and further national development.

For these reasons, and because of the harm it will cause to the poor in Peru, I urge you to vote no on the US-Peru free trade agreement.

Sincerely yours,

Raymond C. Offenheiser
President

The discussions on the future of the International Coffee Agreement present an historic opportunity to address the ongoing crisis facing smallholder coffee farmers and farmworkers by contributing to sustainable coffee supply chains. At the 2nd World Coffee Conference in September 2005 several organizations presented the International Coffee Organisation and its delegates with the Carta de Salvador—the Salvador Declaration, which stressed the ongoing effects of the coffee crisis facing small-scale family farmers and farmworkers. This paper calls on International Coffee Organization members to support small-scale farmers and farmworker organizations by ensuring space for their direct participation in international debate, creating mechanisms that enhance the availability of market information to small-scale farmers, and maximizing opportunities to develop cohesive international strategies to provide technical support, access to credit, and direct access to markets.

For that reason Oxfam America's duty is clear: We and our project partners must help reform government policies, laws, and social injustices that deny people the right to live a decent life. We do this by providing funding, training, and the moral support people need to make real, substantive and transformative changes. The courageous and visionary people who do this work are setting out to build a movement for social justice—and Oxfam America is one of the few organizations to which they can turn for the help they need.

Several governments and broad sectors of civil society are opposed to this unequal negotiating framework, which would limit the capacity of governments to make trade work for sustainable development and poverty eradication.

Oxfam International asserts that the FTAA will not contribute to sustainable development. It is based on the failed model of the North American Free Trade Agreement, which has neither produced growth nor addressed the crisis of poverty in Mexico.

This paper summarizes the reasons why Oxfam International opposes the FTAA. It puts forward our recommendations for developing different rules and provides an alternative framework for integration.

Amid cheers from a throng of enthusiastic supporters and international media, Make Trade Fair won the day.

Oxfam's trade campaign was launched.

Within hours of the Hong Kong debut, events were held in 25 cities including Brussels, Dublin, Geneva, Mexico City, San Salvador, and Washington, D.C. These events ranged from press conferences and symposiums to a rock concert in London’s Trafalgar Square.

Oxfam's trade campaign seeks to unite concerned citizens around the world in calling for fair trade policies that will help move millions of people out of poverty.

Nobel Prize Professor Amartya Sen, UN Secretary-General Kofi Annan, and musician and social activist Bono were among those who endorsed the campaign. "Oxfam has got it right," said Bono. "It wouldn't cost much to change the rules of trade so that poor countries can work their way out of poverty. But the world's leaders won't act unless they hear enough people telling them."

Also in this issue of EXCHANGE, writers Frances and Anna Lappé discuss their book Hope's Edge: The Next Diet for a Small Planet, and we bring you updates on Oxfam's work with water and sanitation, drought in Ethiopia, and indigenous women in the highlands of Peru who are speaking out after decades of violence.