CAFTA: an outsourcing and foreign aid pact.(INSIDER REPORT)(Central American Free Trade Agreement)

According to a 75-page analysis published by the Washington Alliance of Technology Workers (WATW), an affiliate of the Communications Workers of America union, the six nations of the "CAFTA region" compose "a tiny export market for high-tech goods," summarized the May 11 San Jose Mercury-News.

Taken together, the nations of the proposed Central America Free Trade Agreement--Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua--"accounted for just 1.4 percent of all U.S. information-technology exports in 2004." Pro-CAFTA information industry groups claim that the agreement would translate into a $75 million annual savings on export tariffs. However, notes the WATW report, that would "not even be a blip on the radar screen of the U.S. information-technology industry--much less the boon that would lead to increased U.S. high-tech employment levels."

Writing in the May 18 Washington Times, Alan Tonelson of the U.S. Business and Industry Council pointed out that the CAFTA nations have an aggregate population approximately the size of "California and New Jersey combined" and a combined economic output "about the equivalent of New Haven, Connecticut."

"Anyone who believes opening trade with these impoverished mini-markets can boost growth in the $12 trillion U.S. economy must have bought an elevator pass in high school," Tonelson sardonically comments. The "CAFTA 6," he concludes, "aren't mainly markets for exports at all. They're sweatshops. And because they are too poor to create genuine two-way exchange, CAFTA isn't really a trade agreement at all. It's an outsourcing agreement."

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