________________________________________________________ EQUIPO PUEBLO/RMALC MEXICAN NEWS SUMMARY OCTOBER 13, 1993 ________________________________________________________ NAFTA/ECONOMIC NEWS FROM THE MEXICAN PRESS OCTOBER 6-12, 1993 ________________________________________________________ Headlines: MEXICAN LABOR FORCE WILL BRING FOREIGN INVESTMENT POLITICAL COSTS IN MEXICO, U.S. IF NAFTA NOT APPROVED BISHOPS DENOUNCE RADICALIZATION OF U.S. IMMIGRATION POLICY PRIVATE SECTOR NEEDS TO SUPPORT NAFTA PROCAMPO WILL QUIET FEARS ABOUT EFFECTS OF THE NAFTA NEED FOR SOCIAL CLAUSE WITHIN THE NAFTA DEFEAT OF THE NAFTA WILL HELP TRANSITION TO DEMOCRACY 6 MEMBERS OF U.S. CONGRESS VISIT MEXICO TO DISCUSS NAFTA RELATION BETWEEN OPERATION BLOCKADE AND THE NAFTA FORUM ON THE NAFTA THE DEFEAT OF THE NAFTA WOULD NOT BE A DISASTER FOR MEXICO ________________________________________________________ MEXICAN LABOR FORCE WILL BRING FOREIGN INVESTMENT The quality and competitiveness of the Mexican labor force will accelerate foreign investment in Mexico with or without the signing of the NAFTA, said Pyong Hwoi Koo, International President of APEC. After meeting with President Salinas yesterday, Hwoi Koo told the press that U.S., Japanese, and Korean businesses first began investing in the maquiladoras along the U.S.\Mexico border as an experiment. But, now that the Mexican labor force has proven its high level of productivity and competitiveness, foreign investors will "have more energy to invest in Mexico." Hwoi Koo confirmed that Mexico is seen as a strong country with tremendous economic possibilities and very good foreign relations. Therefore, he added, "all countries see Mexico as the ideal place for future investments." He mentioned that Salinas' trip to Asia to speak with businesspersons about the advantages Mexico offers for foreign investment will encourage the continued flow of investment. Mitsuro Donawaki, the Japanese ambassador in Mexico, said that, with or without the NAFTA, Mexico will continue to be a strategic country for Japan. However, he added that in the past Japanese investors have faced difficult obstacles in doing trade with Mexico and that the signing of the NAFTA would indeed be significant for the flow of Japanese investment in Mexico. Source: La Jornada, October 5 and 7, 1993; El financiero, October 5, 1993. ________________________________________________________ POLITICAL COSTS IN MEXICO, U.S. IF NAFTA NOT APPROVED Government officials predict that a rejection of the NAFTA would have negative economic, social, and political consequences. According to one source, a defeat of the NAFTA will cause a resurgence of voices opposing close relations with the U.S. In terms of trade, the Mexican government will have to focus its efforts on opening trade relations with other parts of the world to make up for the loss of the U.S. market. In the economic sector, the present trade deficit will make it necessary to look for other sources of capital. Sources say that the most immediate effect of the defeat of the NAFTA will be felt in the Uruguay Round of the GATT. The message is: If the U.S was not able to attain a free trade agreement with Mexico, how can one hope for an even broader, more complicated agreement with the entire international community. Officials in Mexico fear that the perceived deception of the Mexican population could translate into high political costs in the face of presidential elections next year. They fear that the Mexican people will turn against the government if the NAFTA is not approved. In order to prevent this from happening, Mexican company representatives said that it is necessary to convince the Mexican population that the country's process of stabilization and growth does not depend on the trade agreement. Elio Vazquez of the PRD (Party of the Democratic Revolution) said that "the economic system is falling apart under Salinas." Vazquez believes that the latest economic measures taken by the government are part of an emergency plan in case the NAFTA is defeated. He also believes that their ends are purely political. James R. Jones, the U.S. Ambassador to Mexico, denied any connection between the NAFTA and political stability in Mexico. He added that statements connecting the approval of the NAFTA to Mexico's political stability must not lead to deteriorating relations between Mexico and the U.S. He reiterated his confidence that the NAFTA will be approved on time by the U.S. Congress, though he acknowledged that it may be a tough battle. Source: El Financiero, October 6, 1993; El Financiero, October 7, 1993; La Jornada, October 9, 1993; La Jornada, October 12, 1993. ________________________________________________________ BISHOPS DENOUNCE RADICALIZATION OF U.S. IMMIGRATION POLICY In an official document produced by the Episcopal Commission for California and Baja California, bishops from the U.S. and Mexico expressed their concern for the impact of the NAFTA and demanded that the trade agreement consider human beings over capital, work or production. They also asked NAFTA negotiators and specialists to respect the rights of both countries to their own cultures and religious values and disagreed with the U.S. government's tendency to link immigration to an increase in delinquency, job loss, and economic problems in the U.S. The leader of the Tijuana diocese, Emilio Carlos Berlie Belaunzaran, declared that while the two countries are agreeing to a trade agreement they should also consider the human right to free migration. Source: La Jornada, October 7, 1993. ________________________________________________________ PRIVATE SECTOR NEEDS TO SUPPORT THE NAFTA Ex-President George Bush spoke to company managers, politicians, and academics in Guadalajara yesterday, saying that the U.S. private sector has not done enough to support the NAFTA. Bush was invited to participate in a meeting of the Millenium Project, a private group which has formed to confront global economic trends and the new business culture. Bush announced his plans to launch a pro-NAFTA campaign, similar but stronger and more accurate than Ross Perot's Anti-NAFTA campaign. In the opinion of the Republican Party, the image of the U.S. will suffer a serious blow not just in Mexico but in all of Latin American if the NAFTA is rejected by Congress. He told participants that he is proud of having worked for the NAFTA and sees it as what is right for the U.S. For him the NAFTA is about much more than jobs, open markets, and free trade. It has to do with the way in which the rest of the hemisphere will view the United States. In Mexico, Jaime Serra Puche, Secretary of Trade and Industrial Development (Secofi), met with 20 businesspersons and bankers to inform them of the status of the NAFTA and encourage them to pressure government and company officials in both countries to ratify the NAFTA. Serra remains optimistic about the eventual ratification of the NAFTA but told businesspersons that a push from both the Mexican and U.S. private sector would help ensure the approval of the trade agreement. Source: La Jornada, October 7, 1993; El Financiero, October 7, 1993; El Financiero, October 8, 1993. ________________________________________________________ PROCAMPO WILL END FEAR OF THE EFFECTS OF THE NAFTA The Governor of Michoacan, Ausencio Chavez, announced yesterday that the Farmers Support Program (Procampo) is oriented toward quieting fears about the negative effects of the NAFTA on agricultural producers. According to Chavez, Procampo will allow small farmers to establish themselves on the land and stop emigrating to cities or to the U.S. Through Procampo, President Salinas has promised $1.1 billion to support national agriculture. However, the small farmers of the Cardenista Front for National Reconstruction in Tamaulipas complained of the lack of information regarding the agricultural support programs. A local Cardenista deputy, Martin Coronado, said that he views the Procampo as a political move for the PRI to come out ahead in next years presidential elections. Source: La Jornada, October 9, 1993. ________________________________________________________ NEED FOR A SOCIAL CLAUSE WITHIN THE NAFTA Secretary General of the International Confederation of Free Union Organizations (CIOLS), Enzo Friso, told Fidel Velazquez, the leader of the Confederation of Mexican Workers (CTM), that it is essential that trade unions in the U.S., Mexico, and Canada negotiate the inclusion of a social clause within the NAFTA once it is ratified in order to defend workers' rights. He acknowledged that it was a mistake not to include social issues within the negotiation of the NAFTA. Friso said, "the CIOLS is in favor of the trilateral agreement, but it must include social clauses, so that multinational corporations cannot take advantage of the low cost of labor and so that there be benefits for the workers in the three countries." He added that whether or not the NAFTA is approved it is important to create union organizations capable of assuring that businesses comply with international agreements to liberty and trade union participation and rights. Friso agreed with comments from the recent meetings of the AFL-CIO on the need for workers of the signatory countries to recognize that they will only be able to resolve their problems by fighting together against the neoliberal system that is destroying the world economy. Source: La Jornada, October 9, 1993. ________________________________________________________ A DEFEAT OF THE NAFTA WOULD HELP DEMOCRACY The defeat of the NAFTA will facilitate the transition to Democracy in Mexico said Ifigenia Martinez, director of the Center for Studies on the Democratic Revolution. Rosalbina Garavito, the ex- parliamentary coordinator of the PRD (Party of the Democratic Revolution) reiterated this sentiment explaining that if the NAFTA is either defeated or delayed in the U.S. Congress, Salinas will be in a weakened position to bring the PRI presidential candidate to victory. Martinez said. "the defeat of the NAFTA would signify a serious reversal for Salinas, but not for the country. On the contrary: the country would have no choice but to initiate its own economic development alternative." Source: La Jornada, October 10, 1993. ________________________________________________________ 6 MEMBERS OF CONGRESS VISIT MEXICO TO DISCUSS NAFTA Six members of congress visited Chihuahua and met with representatives from human rights and women's organizations, company managers, and government officials to discuss the impacts of the NAFTA. The Congresspersons expressed that the outcome of the final vote for the approval or rejection of the NAFTA on November 17 would depend largely on what the Congresspersons learned on their visit which began last Thursday and ends tomorrow in Tamaulipas. Only two of the six, William Zeliff and Gary Condit, announced that they would support the NAFTA. The remaining four named the labor and political situations in Mexico, the loss of jobs, and the potential ecological damage as the principal reasons for their opposition to the NAFTA. Collin Peterson, leader of the opposition to the NAFTA in the Congress, expressed his surprise that newspapers are saying that if the NAFTA is not signed now, there will be no NAFTA. He expressed with certainty that the defeat of the NAFTA would not mean the end of the idea of a free trade agreement in North America but, the beginning of negotiations for a new and better agreement. Source: La Jornada, October 11, 1993; El Financiero, October 9, 1993; La Jornada, October 9, 1993. ________________________________________________________ RELATION BETWEEN OPERATION BLOCKADE AND THE NAFTA Bernard Sanders (I-Vermont) said in Chihuahua yesterday that the Operation Blockade that is being carried out on the border between Juarez and El Paso is closely linked to the debates surrounding the NAFTA. Sanders asserted that if and when the NAFTA takes effect illegal immigration to the U.S. will increase due to the fact that Mexicans do not want to keep earning the measely dollar-a-day wages paid in the maquiladoras. The implementation of the NAFTA would mean an increase in the number of maquiladoras but since these jobs pay so little and are seen as undesirable it would not reduce the number of illegal immigrants to the U.S. Source: La Jornada, October 11, 1993. ________________________________________________________ FORUM ON THE NAFTA At the forum "Indigenous People of Today in the Face of the NAFTA" Carlos Gonzalez Flores, a representative of the Mazuaha tribe, announced that Mexico's Indian population (about 12 to 15 million) knows little about the NAFTA and its contents. He asked that they be informed of its significance and scope before the NAFTA takes effect. He also asked that the Mexican government take into consideration its Indian population so that the U.S. Congress is obligated to respect the rights of these people if the NAFTA is ratified. According to others participating in the forum, the Indian population rarely sees the benefits of free trade agreements or even social and agricultural development projects. Martin Torres, the PRI's Sub-secretary of International Relations, told participants at the forum that free trade will bring many benefits to the agricultural sector in the way of modernization and free access to U.S. markets. Since many of the country's Indian population are small farmers, this implied that the NAFTA would benefit them. Source: La Jornada, October 12, 1993. ________________________________________________________ DEFEAT OF THE NAFTA WOULD NOT BE A DISASTER FOR MEXICO According to Hector de la Cueva, member of the Mexican Action Network on Free Trade, the defeat of the NAFTA by the U.S. Congress would be a blow to the Mexican government's economic policy, "but not a disaster for the country, given that there are more just alternatives for the country's development." He commented that the systematic application of the present economic policy for the last eleven years has brought Mexico to its highest level of foreign debt and has meant that 60% of small businesses are close to bankruptcy or have closed due to the lack of financial liquidity, decrease in demand, and excessive importation of foreign products. De la Cueva participated in a press conference with representatives from 29 other social and trade union organizations in which they announced the National Day of Action Against the Foreign Debt and the NAFTA on October 23, 1993. The issues they intend to address are workers' rights, the defense of public education, salary recuperation, job security, human rights, and Mexican sovereignty. Source: La Jornada, October 12, 1993. ________________________________________________________ Co-produced by: Equipo PUEBLO and RMALC. Equipo PUEBLO, Francisco Field Jurado 51, Col. Independencia 03630, Mexico DF, MEXICO Tel: 011-525-556-0642 Fax: 011-525-672- 7453 E-mail: pueblo@laneta.igc.apc.org Red Mexicana de Accion Frente al Libre Comercio (RMALC) Address: RMALC, Godard 20, 07790 Mexico DF, MEXICO Tel: 011-525-556- 0642 Fax: 011-525-556-9316 E-mail: pueblo@laneta.igc.apc.org (temporarily) Edited and distributed by the Institute for Agriculture and Trade Policy (IATP), 1313 5th Street, SE, #303, Minneapolis, MN, 55414- 1546. Tel: 612-379-5980 Fax: 612-379-5982 E-mail: iatp@igc.apc.org