Zapping Free Trade
Mexico and the European Union came together in Lisbon on March 23 to sign what they describe as the most progressive commercial treaty ever forged between a developing nation and a first-world trade block. But the T.L.C.U.E., as its known in Spanish, may not take effect July 1 – unless the Mexican government makes major human rights improvements in the conflict-ridden state of Chiapas.
The T.L.C.U.E. is the first trade treaty signed by the European Union and a Latin American country. It has been approved by the Mexican Senate, the European Parliament, the Council of Europe, and thirteen of the E.U.’s fifteen members, with Luxembourg poised to add its name to the list in April. But Italy’s left-leaning lower house has yet to ratify the treaty. The Italian legislators cite their concerns over human-rights abuses Mexican military and paramilitary forces are committing against civilian sympathizers of the Zapatista Army of National Liberation (E.Z.L.N.) in Chiapas. The lower house’s refusal to come on board (the Italian Senate has already approved the pact) cripples important T.L.C.U.E. chapters dealing with investment and services.
Italian opposition to the Mexican government’s Chiapas policies dates back to the first day of the Zapatista rebellion. On January 1, 1994, the Mexican rebels rose up just as another trade pact – the North American Free Trade Agreement – had gone into effect. That day, left-wing Italian journalists vacationing in the highland city of San Cristóbal de las Casas obtained the first interviews with the E.Z.L.N.’s quixotic spokesperson Subcomandante Marcos, and broke the story to the world. Since then, Italian delegations have worked in Chiapas as human rights observers and solidarity workers. They have not always been welcome: 140 members of the ¡Basta Ya! support group were expelled (some for life) from Mexico in May 1999, for purportedly intervening in domestic political affairs. Among the deportees were several members of the Italian parliament. Further cementing ties between the rebels and Italian partisans was the 1997 appearance of a Zapatista couple in Venice, where the E.Z.L.N. was awarded that city’s Golden Lion medallion.
During five years of negotiations between Mexico and the E.U., the central issue of contention has been the political chapter of the proposed accord. That chapter includes a “democracy clause,” which mandates free and fair elections, and respect for human rights, as conditions of commercial association. Mexican President Ernesto Zedillo almost walked away from the agreement two years ago, claiming the clause is an unfair restraint on free trade. He relented, and an interim agreement was signed in 1998.
The left in Europe seems to be of two minds on the trade pact. Radicals oppose it; the Greens and Social Democrats want Mexico inside the E.U. structure, where its government can be held accountable for human rights violations under the democracy clause. Yet the signing of the agreement in Lisbon does not does mean Chiapas is no longer an issue linked to European trade. A delegation of mostly Italian European Parliament members was scheduled to visit Guerrero and Chiapas this spring to review the human rights situation there. And a Danish watchdog commission was established to monitor the conflict in Chiapas. Any serious human rights abuse can result in suspension or termination of the treaty under the democracy clause.
The threat of suspension affords the Zapatistas both protection from military attack and a certain degree of leverage in dealing with the Mexican government. (The Zapatistas traditionally oppose the neo-liberal economic reforms the treaty codifies.) The democracy clause might also make it more difficult for the Institutional Revolutionary Party (PRI) to steal the July 2 presidential elections here, as it has done in the past – most notably in the 1988 election, which almost all but the PRI agree was won by Cuauhtémoc Cárdenas. So the ties with Europe have the Mexican government on notice.
Nor was the treaty universally embraced here in Mexico. Despite the Zedillo government’s efforts to sneak ratification of the T.L.C.U.E. through the Mexican Senate with a minimum of notice, some citizens refused to look the other way. Farmers, for example, who have been beaten down by NAFTA imports, splattered the Senate façade with eggs and overripe tomatoes while the treaty was being debated. At the same time, bean farmers from the state of Zacatecas seized the Commerce Ministry to protest massive imports from the U.S. under NAFTA. The 558 percent increase in imports since 1994 has pushed many Mexican farmers out of their own national market. No sooner had the bean farmers gone home than thousands of small coffee producers showed up at the ministry to protest that coffee prices have plummeted (from fourteen to six pesos a kilo), while at the same time, under NAFTA, the Mexican government has permitted coffee imports for resale.
The farmers get little support from the PRI and the right-of-center National Action Party (PAN). Both are engaged in a fierce fight for the presidency and have enthusiastically endorsed the trade pact, leaving the center-left Democratic Revolution Party (PRD) to lead the opposition. PRD senator Jorge Calderón argued that NAFTA – which he describes as the predecessor to the European trade agreement – has been a disaster for most Mexicans. NAFTA’s 1994 start-up began an economic collapse in Mexico that brought the total unemployment to ten million the following year. Although the treaty with North America has subsequently created a few hundred thousand low-wage maquiladora jobs along Mexico’s northern border, it has also crushed national industry and agriculture, contends Calderón. Furthermore, he argued, the overwhelming influence of the U.S. has permitted Washington to disregard any NAFTA clause it considers politically risky to implement – sugar quotas and the continued exclusion of Mexican truckers from the U.S. are two examples often cited in Mexico.
Mexico has eight free-trade pacts, with a total possible consumer market of 870 million customers; opposition to free trade is not restricted to the agricultural sector. Small and medium businesses fear that the trans-nationalization of trade leaves them to sink or swim. Vicente Yañez, who directs the most important small-business chamber of commerce (the National Chamber of Transformation) predicts the economy will suffer again when a wave of European consumer goods hits the Mexican market. The small business sector even petitioned United Nations High Commissioner for Human Rights Mary Robinson, when she visited Mexico late last year, asking for relief from the impending start-up of the T.L.C.U.E.
The benefits of NAFTA have been limited to about 300 transnational corporations and exporters, point out opponents of the new trade pact, such as PRD presidential hopeful Cuauhtémoc Cárdenas. If elected (and his chances are slim), Cárdenas proposes to renegotiate NAFTA clauses that only benefit Washington.
The advent of the T.L.C.U.E. is expected to generate the installation of a new tier of European-owned maquiladoras in Mexico’s north – an obvious attempt to penetrate booming U.S. markets. Already a prominent Spanish steelmaker has indicated it will buy up Altos Hornos, a large Mexican steel producer that has fallen on hard times. The company will be used as a platform to sell steel in the U.S. and Canada. Mexican trade officials recently conceded to The Wall Street Journal that such operations are perfectly legitimate under the provisos of the T.L.C.U.E.. Similarly, U.S. manufacturers will utilize Mexico’s new relationship with the E.U. as a cover to dump U.S. goods in Europe.
Alfonso Moro, a European observer for the Mexican Network Against Free Trade, has kept tabs on the T.L.C.U.E. negotiations since 1995. He observes that the treaty was supposed to be presented at the Seattle summit of the World Trade Organization last November as a model for future north-south trade pacts. The presence of 40,000 anti-WTO demonstrators in the streets of Seattle forced cancellation. T.L.C.U.E. is exactly the sort of agreement that was being protested in Seattle, Moro told the weekly magazine Proceso.
Zedillo has argued that T.L.C.U.E. will help ease the absolute market hegemony the U.S. has achieved under NAFTA. Trying to balance Washington’s commercial domination of the Mexican economy has been a goal of Mexican presidents ever since Porfirio Díaz, who was forced out of office in 1910. NAFTA has only increased such domination. The U.S. now receives 92 percent of all Mexican exports ,with only 3.9 percent going to Europe. Before NAFTA, Europe had about a 10 percent share.
Although the T.L.C.U.E. does not come on line until 2003, when most Mexican products will be able to enter Europe tariff-free, the free trade treaty officially starts July 1, precisely twenty-four hours before the Mexican presidential election. Opponents to T.L.C.U.E. recall that six years ago, the start-up of another free trade treaty occasioned an indigenous rebellion in Chiapas, and wonder if history will repeat itself in 2000.
John Ross is holed up in his hotel room in Mexico City trying to finish his forthcoming book, “The War Against Oblivion (Zapatista Chronicles 1994-2000).”