CAFTA to be Decided in Costa Rica Via Nationwide Referendum

Costa Rica President Oscar Arias has gotten his wish: a national referendum. Mr. Arias has been a staunch proponent of Costa Rica's joining the trade pact known as the Dominican Republic-Central America Free Trade Agreement (DR-CAFTA). The agreement encompasses the U.S. and-in addition to Costa Rica-El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic.

Costa Rica is the only participating country that has not ratified DR-CAFTA. President Arias officially announced on April 13 that the decision would be made via referendum, but the date had not been established. The Costa Rica courts have now approved a referendum to be held on October 7. Locals will vote "yes" or "no" on whether they think Costa Rica should ratify the accord.

President Arias has urged local groups, especially business groups, to support the trade agreement. Polls show that there is support for DR-CAFTA, but the "yes" camp is apparently leading by a small margin. Opponents say that the trade pact infringes upon national sovereignty, while supporters insist the country cannot afford not to join DR-CAFTA.

If passed, the agreement would create a free trade zone like that of the North American Free Trade Agreement (NAFTA) that encompasses the U.S., Canada, and Mexico. Tariffs on some 80% of U.S. exports to DR-CAFTA countries would be eliminated (most of the participating countries' exports already enter the U.S. tariff-free).

Here's a summary of DR-CAFTA's provisions:

-Public services will be open to private investment.
-Governments will guarantee foreign investment.
-Government procurement will be open to transnationals.
-Tariffs will be reduced and eventually eliminated.
-Agricultural products will be duty-free
-Governments will eliminate subsidies on agricultural products (except sugar).
-Intellectual property rights will be protected.
-Governments will commit to phase out protectionist barriers in all sectors.
-National monopolies will be dismantled to foster competitiveness.
-Transnationals will have the right to sue countries in private international courts.
-Environmental laws and measures for improving the environment will be enforced.
-International Labor Organization labor standards will be implemented.
-Governments will pledge to reduce corruption and increase transparency.
-Pharmaceutical corporations will have test-data exclusivity.
Your Latin America Insider,

Suzan Haskins
for International Living

P.S. There's never a dull moment in Costa Rica-if you're planning to be here this autumn, you'll witness the excitement of the October referendum…but you'll also have the opportunity of a lifetime. Stick around so you can join us this November 5-7 for Live & Prosper in Costa Rica. This seminar will be an exciting event, in which experts, expats, and potential expats (like you) converge for a true meeting of the minds. Here's all the information you need…don't miss out.

* Sources: Nacion.com, Wikipedia.