The Central American Free Trade Agreement (CAFTA, also known as DR-CAFTA) is a agreement that has been negotiated between the United States, five Central American countries, and the Dominican Republic. In order for countries to officially join the trade agreement, CAFTA will need to be ratified in each country's legislature. Like the North American Free Trade Agreement (NAFTA), CAFTA will do more than just eliminate tariffs and trade barriers between those countries.

Pushed by powerful political and corporate interests, this agreement was crafted in secret. And with President Bush's "Fast Track" (or Trade Promotion Authority), Congress can vote only Yes or No on trade deals - U.S. representatives cannot influence or amend the agreement.

Why We Oppose CAFTA

CAFTA is based on the seriously flawed NAFTA, and it extends and amplifies the harmful aspects of NAFTA in the following ways:

Threat to workers in the U.S. and in Central America

• CAFTA would entrench existing sweatshops by only requiring countries to enforce their own labor laws, even though many fall far below international labor standards.
• Fines for labor violations would be paid by the country to itself.
• Because the minimum wage in Central America is even lower than in Mexico, competition will continue to move jobs out of the U.S. and push wages lower throughout the region.
• The CAFTA definition of "labor laws" excludes laws related to workplace discrimination and will allow abuses like routine pregnancy testing of women workers or applicants, resulting in a loss or refusal of employment.

Danger of increasing pressure on Central Americans to emigrate to the U.S.

• CAFTA, as NAFTA has done in Mexico, would pit poor Central American farmers against highly subsidized U.S. agribusiness.
• Grain prices would drop dramatically in Central America, forcing small subsistence producers off their farms and into overcrowded cities where unemployment is already high, and eventually to the U.S.

Threat to governments' ability to protect the welfare of their people

• CAFTA could be used to promote privatization and deregulation of essential services, such as health, education, and water, resulting in prohibitive price increases, reduced access, and compromised quality.
• CAFTA would prevent governments from giving preferences to local firms and from promoting gender equity, social justice, and respect for human rights when granting contracts.
• CAFTA will be used to weaken national and international environmental standards. Companies would have the right to sue any government that obstructs their capacity for profit with environmental regulations. (Thanks to the American Friends Service Committee's Trade Matters program for the information above.)