Free Trade Area of the Americas - FTAA


Trade Negotiations

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October 24, 2000

Original: Spanish
Translation: FTAA Secretariat



Name South American Commission for Peace and Security
Organization International, non - governmental


1. - FTAA Viability.

The fact that the FTAA, by its very nature, is a free trade area of the Americas highlights difficulties created by the heterogeneity of the countries of the area. There are nations, for example like Barbados with 265,000 inhabitants and Mexico with approximately one hundred million people and differences such as those between Argentina and Haiti or Bolivia and Venezuela. Mechanisms are being set up to facilitate the participation of smaller economies but those great differences may well render them ineffective.

There may also be opposing interests between nations and groups of countries, such as those between the United States of America and Brazil or with all the MERCOSUR member states. A good example of FTAA preparation would have been the progressive widening of NAFTA, however, the United States was unable to achieve political consensus on that point.

The general objectives in the declaration appear indisputable to us and are similar to those contained in the declarations of the WTO, MERCOSUR, the Ibero-America, Americas and other Summits.

2. - Agriculture

Besides ensuring that the sanitary and phyto-sanitary measures would not be a reason for arbitrary or unjustified discrimination between countries or a hidden restriction to international trade, joint actions taken by nations sharing the same ecosystems where real life problems occur, will also have to be considered. For example, the fruit fly that affects Southern Peru, Northern Chile and Western Bolivia is a major obstacle to sub-regional trade with possible consequences for world trade.

Agricultural subsidies, from the outset, should be dealt with the greatest possible transparency, because they have blunted a number of free trade agreements and can be a bell weather for the necessary political will to bring the FTAA to fruition.

3. - Investment.

Criteria for setting common rules for foreign investment should be established, whenever possible, not only for the creation of a stable and foreseeable environment that would protect the investor, but also to determine the conditions offered to the investor to avoid unfair competition between countries that may be prejudicial to their economies. This matter is of great concern within the European Union.

4. - Subsidies, Antidumping and Countervailing Duties.

Although it is important to improve the rules and procedures dealing with the application of dumping and subsidies legislation to avoid creating trade barriers within the area, rules should be considered to protect FTAA countries from unfair competition from countries producing low quality goods at unbeatable low costs based on minimum wages, child and prison labor – in essence almost slave labor – and no social security systems for the workers.

The consequences of this type of competition have been felt, for example in the spinning, textile, clothing, footwear and other manufacturing industries that have disappeared.

Therefore, if we do not protect ourselves from this type of competition, we are lowering our standards through a reduction in wages and flexible work contracts to remain competitive in the whole trade globalization process.

5. - Government Procurement

The whole purpose of this point is to widen market access for government procurement to all FTAA countries through mechanisms that ensure openness and transparency in purchasing procedures and avoid discriminatory practices. However, the vast differences between the powerful industrial countries, for example the United States, Canada, Brazil in comparison to Columbia, Venezuela and Chile, who are in such a deteriorated state, must be taken into account. The latter will have great difficulty in gaining access to the benefits offered by this equality of opportunities.

Moreover, it should be noted that until very recently, government procurement was used as a tool to strengthen industrial technology in the respective countries by creating development potential for industries producing sophisticated goods to compete, under certain circumstances, in the tendering process. We need not go far to find an extreme example of technological progress; the U.S. aerospace and aeronautical industries developed thanks to the purchases made by its own government.

6. – Intellectual Property Rights

An attempt is being made to promote and guarantee proper protection for intellectual property rights, bearing in mind recent technological discoveries.

The present intellectual property mechanism, it should be recalled, was created by the 1876 Paris Union Convention of 1876 and its subsequent amendments. It was inspired by the reality of its time when researchers, such as the Curies’, Lumière brothers, Thomas A. Edison and Marconi devoted a large part of their life and wealth to succeed in their research work.

The resulting product of their intelligence was protected by a 15 year invention patent monopoly, renewable, in certain circumstances, for lesser periods of time. This would appear to have been a just reward for their efforts and the slowness of communications of the time to disseminate and exploit those new inventions.

Things are quite different today. The inventors are large corporations who invest vast sums of money. The revolution in communications has made patent exploitation almost instantaneous worldwide and guarantees a rapid recovery of the original investment.

Despite the aforementioned, instead of facilitating the transfer of patented technological know-how with shorter protection periods and more liberal licenses, there is a global trend to strengthen intellectual property protection by widening the scope to incorporate the manufacturing process. This obstructs and greatly increases the cost for the transfer of technology to developing nations.

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