New Internationalist

Yes! But…

December 2007

Controversial treaty sneaks through in Costa Rica

Costa Rican President Oscar Arias must have heaved a huge sigh of relief on the evening of 7 October. His country had just voted ‘Yes’ to signing the controversial Central American Free Trade Agreement (CAFTA) with the United States, and the campaign on which he had based his bid for office had been justified.

But critics are already questioning how the outcome of the national referendum – the country’s first – can be claimed as a win when the margin was just three percentage points. Opponents claim this shows that nearly as many people were against the treaty as were in favour.

The route to the polls was marred by claims of bully-boy tactics both at home and in the US. Costa Rica’s Vice-President, Kevin Casas, was forced to resign after a leaked memo showed he’d tried to engineer a fear campaign in order to get a positive result in the referendum, and as polling day neared the US warned it would be highly unlikely to renegotiate a bilateral treaty with Costa Rica if it wasn’t passed this time.

Despite the outcome, the debate continues.

The ‘No’ camp say CAFTA was badly negotiated and does not represent the best deal for Costa Rica. Some say they are not completely against a free trade pact with the US, but want to renegotiate to protect some of the country’s social structures, such as the state telecommunications and insurance monopolies.

Supporters argue that CAFTA protects their trade relationship with the US. Costa Rica already had preferential status with the superpower through the Caribbean Basin Initiative, but proponents say part of that agreement was temporary and made the country vulnerable, particularly in the tuna and textile industries. CAFTA, a permanent treaty, gives the country protection, they insist.

In addition, supporters claim Costa Rica is now better placed to compete in the global market. As a consequence of the ‘Yes’ vote, Costa Rica will now join with the rest of Central America in negotiating a free trade agreement with the European Union.

Since the result was announced, opponents have threatened to do everything they can to block the treaty’s passage. Some 13 new laws have to be passed in the legislative assembly in order for the Agreement to come into effect. Although leading opposition figures have agreed to engage in the process, supporters fear that stalling tactics will be used and the March date by which the treaty must be in effect will come and go without the legislation being passed.

As the slight winning margin indicates, ordinary Costa Ricans continue to be divided over the outcome. Gadiel Alvarado, 31, a call-centre worker, had been undecided as polling day neared, but said he voted in favour because he believes the country’s economy can only grow by opening the doors to globalization. ‘The United States is the biggest marketplace in the world so I don’t think we could afford to turn our backs,’ he added.

Others disagree. Roberto Guell, 78, a veteran of the country’s last armed conflict in 1948, told local media the agreement would finish the work begun by William Walker, a US filibuster who invaded Central America in the 19th century.

‘It’s going to ruin our agriculture, our industries,’ he said. ‘CAFTA is a well-executed attempt to get what [the US] couldn’t get in 1856.’

Bryan Kay

This column was published in the December 2007 issue of New Internationalist. To read more, buy this issue or subscribe.

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This article was originally published in issue 407

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