May 13, 2005

We need a more win-win CAFTA

Sir, You rightly lend your support to the Central American free trade agreement, CAFTA, especially since not doing so would make it seem like you are joining the ranks of those opposed to free trade and also because in today’s world any relations are always better than none. Nevertheless, you need to reflect more closely on the reasons why it is so difficult for CAFTA to gain general acceptance and why, if finally approved, it might not be able to deliver on its promises.

CAFTA, as all trade negotiations in vogue, concentrates basically on how to split the ever shrinking cake of manufacturing and agriculture; how to impose a stricter respect for the intellectual property rights of the developed nations; and how to be able to enforce it, but, as often happens, it shies away from treating the issues that really seem to matter for the future. When currently 40% of Central America’s workforce works abroad, mostly in the US, mostly in services, it should be clear that it is really in the area of services and immigrations that these two partners need better and more generous free trade pacts. For instance instead of exchanging a few textile jobs that could soon anyhow be lost to other places of the world, why do not the partners look for economic growth and jobs in areas such as health and attending the needs of the rapidly aging population. That seems much more like a win-win CAFTA to me.