Cafta the Central America Free Term Paper

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S.A. preferred to move the responsibility of assistance from the arms of the state and pass in unto the ones of the private sectors.

The trade capacity building assistance has its focus upon three main areas. The first area is represented by the reinforcement of the negotiating capacity of the five countries which adhered to the CAFTA agreement. The second one referred to then strengthening of the institutions which were responsible for the implementation of all the CAFTA decisions. The third one meant solving the problem of the costs implied by the consequences of the agreement. None of the declared purposes was fully reached until today.

There were environmental obligations, as well as labour ones, but they had to be implemented by the parties themselves with little if any help from the outside. Under the circumstances in which the unity of the Central American party had been destroyed by tye negotiations themselves, it was obvious that such an outcome was very difficult to be achieved.

The truth is that instead of favouring integration, the negotiation policies of the U.S.A. managed to divide the Central American countries instigating them against each other. It was an intelligent move for them as it resulted into the signing of bilateral agreements through which the countries in Central America got a whole lot less than whet they had asked for initially. The fact that the Central Americans allowed to be divided in defending their interests supported the little promising results that they achieved.

This was not the only serious issue. The U.S.A. insisted on having a confidentiality agreement which would exclude the civil society. At the same time, the propaganda which was meant to support CAFTA was no stranger in the area.

This was extremely unfair from more points-of-view. It was in this manner that the U.S.A. denied the right to important information of national concern to the very institutions supporting the functioning of the state- that is, the organized civil society. Therefore, it was no surprise when unions, agricultural organizations, academic institutions and other entities manifested their opposition to the agreement.

Whether the agreement was successful or not is not easy to say because of the he asymmetries between the parties. It is obvious that the U.S.A. gained a whole lot more than the countries from Central America. The circumstances which it created for itself through the division of the other party allowed for it to exert pressure and have the Central Americans accept their conditions.

The truth is that the economic asymmetries which existed before the signing of the agreement continued to exist afterwards because one party continued to develop while the other one was maintained in the same crisis that was one of its characteristics beforehand.

The effects of the agreement on the economy of the countries of Central America are most likely to be considered advantageous for the U.S.A. And this from a long-term perspective. The improvements which have already been recorded are far from being significant. Judging from this point-of-view, it could be stated that the agreement was not successful because an agreement implies reciprocity as far as the advantages are concerned. On the other hand each country signed its own conditions and if the negotiating team was not strong enough, then the governments of each of the involved countries had to deal with the consequences.

The social impact of the agreement was strong, especially in the countries from Central America. The fact that the negotiations were kept secret from the organized society created an atmosphere characterised by lack of trust. People were not only sceptical, but they also manifested an opposing attitude towards something they did not know enough in order to understand.

The fact that an advertising and promotion campaign was done in the area shows that the U.S.A. wanted to reach its purpose at any cost. This made people realize that instead of a union, this agreement was more of a division. However, taking into consideration the poverty and the undeveloped economies which were to be found in Central America, this was the only option they had. It is obvious that it would not have been wise to oppose the only partner that could have actually done something in order to improve their situation.

The truth is that the economic market is characterised by the scarcity of resources and that every entity needs to make the, maximum of all the opportunities it is presented with. In the lack of serous investments, the Central American countries can not make the best of their potential, which is mostly agricultural. At the same time, the U.S.A. needed the expansion of its already existing markets.

This meant more money coming in. In theory, the agreement was supposed to solve some problems for the Central Americans, through the creation of jobs and so on and so forth. However, the fact that each country had to manage its own development demonstrated that it was a "each for himself" situation.

Had the U.S.A. have had real supportive intentions, the application of the agreement decisions would have benefited from closer assistance and supervision. The weakness of the Central American area was demonstrated right form the beginning through the fact the countries allowed themselves to be divided and signed bilateral agreements instead of defending their rights as a single unit. All in all, it can be stated that the CAFTA agreement was partly successful for the party which was more powerful from the very beginning and that the economic asymmetries existing before the agreement have been maintained.


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Condo, Arturo, CAFTA: Negotiations and outcomes, INCAE Business School,

Hawkins, William 2004, "No troops, no CAFTA," American Economic Alert, [online], available at

Mecay E. 2003, " CAFTA trade pact will cost U.S. jobs and hurt already impoverished central American countries," Inter-Press Service, December 18, [online], available at

McElhinny Vincent 2004, "CAFTA: Few benefits, many costs," America's policy, February 20 [online] available at

Rosen Fred 2008, "The "New York" Times on NAFTA and CAFTA: no alternative," the NY Times, [online] available at

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