The accord is a regional version of the Free Trade Area of the Americas (FTAA) pact, which the administrations of both President George Bush and his predecessor, William Clinton, have pushed to establish throughout Latin America. A similar U.S.-Chile “free trade” accord went into effect in January 2004.

The agreement would eventually end most tariffs and other trade barriers to U.S. farm and manufactured products sold in the region, open state monopolies to foreign competition, and remove legal barriers to foreign investment. There is about $32 billion in annual trade between the United States and the other signers of the accord. A study by the International Trade Commission estimates that this agreement would increase U.S. exports to these six countries by as much as $2.7 billion.

The narrow margin by which the Senate bill passed reflected the different gains and losses anticipated by sections of the U.S. capitalist class should it pass. A close vote is also expected in the House of Representatives.

Caterpillar, Proctor and Gamble, the National Pork Producers Council, the Grocery Manufacturers of America, and the U.S. Farm Bureau are among those that pushed for passage of the accord because they see the elimination of import tariffs in these countries as an opportunity to boost the export of their products into the region.

Other business organizations such as the American Sugar Alliance and the National Textile Association oppose CAFTA because of the increased competition they will face in sales of their products.

Despite the hype about being for “free trade,” Washington continues to maintain an array of protectionist measures designed to shield industries most affected by import competition.

Big sugar producers, which receive $1.2 billion in annual sugar subsidies—equal to nearly a third of the Nicaraguan gross domestic product—are concerned that even slightly relaxing import quotas would affect their ability to keep U.S. sugar prices much higher than world prices. In seeking support for passage of CAFTA, White House officials agreed to limit sugar imports for another two years by paying Central American producers with surplus farm products not to export to the United States.

The pact would guarantee the U.S. pharmaceutical industry protection in sales of its products by preventing the production and sale of cheaper generic medicines to the other CAFTA signers. In addition, the telecommunications industry “would get intellectual property protections and access to the Caribbean Internet, cellular and land-line phone systems,” noted an article in the Washington Post.

Top AFL-CIO officials have been among those most actively campaigning against passage of CAFTA. The union tops adopt an American nationalist stance, claiming that the trade pact “encourages destruction of more high-paying U.S. jobs.” To advance this protectionist, pro-imperialist stance among union fighters, they attempt to link the signing of the trade pact to agreements on labor and environmental law.  
 
 
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