30 April 2002

Chair of the Committee of Government Representatives on the Participation of Civil Society
FTAA Secretariat
Dear Chair:

I am writing to you in response to the open invitation to Civil Society for the submission of written contributions that was issued at the Sixth Trade Ministerial meeting in Buenos Aires. I have outlined our concerns regarding the engagement of civil society and the FTAA process; the negotiations on investment, services, and intellectual property rights; and our concerns about the differential impacts the FTAA will have on women and men.

We are disappointed with the work of the Committee of Government Representatives on the Participation of Civil Society. Dating back to the Santiago Summit in 1998, leaders had instructed FTAA negotiators to ensure that the negotiating process be transparent and that the negotiations be conducted so as to build broad public understanding and support for the FTAA. Four years later we have not seen a genuine effort at building broad public understanding of the FTAA. Furthermore, the Ministerial Declaration issued at the meeting in Buenos Aires in April of this year instructs the Committee to “foster a process of increasing and sustained communication with civil society.”

For this reason we have developed a set of specific proposals to strengthen the functioning of the CGR in the Americas generally. While we are interested in taking part in a constructive effort to increase civil society’s role in the negotiation of the FTAA, this does not imply that we support the current direction of the negotiations, as reflected in the recently released draft text. We would like to see an FTAA that facilitates equitable and sustainable development through trade and investment; yet we remain skeptical due to the very clear bias towards big business that has permeated every aspect of this process.

We strongly urge you to take action on the following proposals that could help to make this a meaningful committee. We suggest that the following steps be taken:

• In the interest of transparency, the full texts of each country’s negotiating positions should be made public. In addition, all the governments should commit to releasing any future versions of the consolidated draft negotiating text along with notations identifying the countries making the proposals contained within it.
   

• We insist that there be more direct contact between negotiators and civil society. Participation is merely token if our views do not reach those that are negotiating the terms of the agreement. In each country, negotiators should meet directly with representative civil society groups before each negotiating session. Following each session, the negotiators should then report back on how the issues raised by civil society groups were addressed in the negotiations.
   

• We insist that well-publicized public hearings take place in each country. Unless FTAA negotiators create opportunities for citizens to engage in dialogue, they will lack the legitimacy they need to speak on behalf of their country. The goal must be to engage as many citizens as possible and to avoid falling into a trap of engaging only the business community or only a few token representatives of civil society. Therefore each country should be required to hold public hearings in all the regions/states/provinces of their country. The outreach must be as extensive and localized as much as possible.
   

• The Buenos Aires Ministerial Declaration also included a note of appreciation for the Sixth Americas Business Forum recommendations. As members of civil society who have been denied the opportunity to present recommendations directly to the Trade Ministers we take offense to this blatant disregard for equality of access. We demand that steps be taken immediately to ensure equality of access among all members of civil society, of which the first should be the creation of a parallel civil society forum with equal access to the trade ministers.
   

• Complete evaluations of the social, gender and environmental impacts of a possible FTAA must be conducted. Impact assessments are a necessary intermediate step in the process of educating the public as well as a prerequisite for negotiating just policies that benefit the majority of people. Lastly, a critical component of a legitimate assessment must be wide and diverse consultation with civil society.

The proposals in the FTAA chapter on investment create a legal framework for limiting the abilities of governments at all levels to regulate investment so that it work towards just and sustainable development. For example, governments should have to power to encourage productive investments yet at the same time protect small, local, family and community enterprises from unfair foreign competition and they should have the freedom to require corporations to give preference to small producers, women, indigenous communities and other traditionally marginalized groups when extending contracts or credit. Furthermore, governments should be free to use capital controls, which has broad support from financial officials, in order to prevent rapid capital outflows which create instability and economic crises. And yet, capital controls would be forbidden according to the proposals in the FTAA.

The draft FTAA text is modeled after NAFTA’s “investor-state” mechanism with defines expropriation in such a broad way that it threatens a government’s ability to protect the environment and the health of its citizens. There is no reason that expropriation needs to be defined so broadly nor is there any reason to give foreign investors more rights than domestic investors.

Lastly, we find the investment measures that prohibit performance requirements completely unnecessary for healthy economic integration. Governments should have the power to impose performance requirements on investors for a variety of reasons such as supporting local economic development plans, in order to achieve the transfer of appropriate technology, or in order spur local business by requiring that enterprises purchase a certain percentage of inputs locally.

First and foremost, all essential public services such as education, health care, and water, should be explicitly exempted from the agreement in order to assure that they be available to all people regardless of income. Overall, we recommend that the services negotiations be implemented gradually in order that a thorough assessment of the impact of services liberalization on vulnerable populations be undertaken.

The draft text shows that one proposal would exclude plant and animal varieties and species, yet the majority of proposals do not. We recommend that all life forms be excluded from patentability We also recommend that farmers not be restricted in using the seeds saved from plants. In addition, holders of pharmaceutical patents should be required to accept compulsory licenses for producers of generic medicines. In addition, monopoly protection for patent holders should not be extended beyond the current 20-year period.

Women and men are differentially impacted by trade and yet in the draft FTAA text there is no reference to gender impacts. We ask that a complete evaluation of the gender impacts of a possible FTAA be conducted. Disaggregated data between males and females should be collected in order to form a statistical baseline for future analyses and mechanisms for dialogue on incorporating gender concerns into trade and investment agreements must be established. Foreign investors should be held accountable under the agreement to domestic laws on sexual harassment, sex and pregnancy discrimination, and job and/or wage discrimination. Technical and development assistance that promotes education, technological training, capacity building for women who are displaced or lose their livelihoods as a result of trade liberalization must be provided.

The FTAA draft text fails to identify which governments support which proposals and countries have not released their individual negotiating positions which leaves members of civil society with an inadequate amount of information about the FTAA. The Committee of Government Representatives on the Participation of Civil Society has failed to take the necessary steps to involve civil society in a meaningful way. Despite this lack of transparency, we have still identified major issues of concern in the text. Therefore, we cannot support the FTAA as it is currently proposed and unless it is radically altered and based on the alternatives that many civil society groups such as The Hemispheric Social Alliance have presented (see “The Alternatives for the Americas” at www.asc-hsa.org), then we will not be able to support such an agreement. Economic integration must be crafted to promote equitable and sustainable development for all people and the current FTAA draft will not only fail to do that but it will push more people into poverty.

Sincerely,