Panama - USA: How the free trade agreement ruined agriculture

Panama - USA: How the free trade agreement ruined agriculture

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By Marco A. Gandásegui, h.

Panama signed a ‘Trade Promotion Treaty’ with the United States, which in a few years has ruined agriculture, industry, fishing and has opened the economy to speculation with North American exports. The US is satisfied with its success in Panama. On the other hand, producers, consumers and, in general, all Panamanians feel cheated by the governments of the day by handing over the future of the country to international pirates.

The government of the former president of the Republic, Ricardo Martinelli, stood out by creating shady businesses taking advantage of the trade policies agreed with the United States. Current president Juan C. Varela has acted by raising tariffs on agricultural products from zero percent to 10 percent. The US, on the other hand, does not impose tariffs on products that are considered strategic imports (food, textiles and others). It simply prohibits its importation.

The new US legislation also indicates that any agreement with another country can be ignored by the US if the Washington government so decides. On the other hand, the US does not allow its ‘partner’ to modify or submit a request to change the agreement. Panama is currently obliged to reduce tariffs on the country's food products little by little over the next ten years. At the same time, we are witnessing the agony and death of the country's agricultural sector.

The agricultural activities of Panama constitute a bastion of the national economy and the political stability of the country. The lower production in rural areas, the more instability (organized crime, corruption and gangs) in the cities. Likewise, the closure of industries hits Panamanian families that disintegrate creating a vacuum in the educational and community systems.

According to Humberto Mazzei, the new US legislation instructs the executive (US president) to extend trade agreements to include non-commercial sectors. The US Congress introduced a new concept when speaking of ‘global value chains’. It is a concept that gives "much greater value to intellectual property and capital investment in the final value of a product, than to labor, materials and any other local input of production." Katú Arkonada states that "despite the fact that since 2007 China is the main producer of software and hardware, 84 percent of the profits in this area continue to be in the hands of US capitalists."

Under the new order of the US Congress, the US president must intervene in other countries to ensure that they implement policies that benefit that country. Panama does not have a policy that defends its interests in the political and less economic world. Just follow the line of the most powerful. In the 1970s, when the Panamanian government negotiated the Canal Treaties with the United States, the country had a coherent foreign policy. We had a presence in the UN Security Council and its representative came to occupy the Presidency of the General Assembly.

According to Mazzei, in sanitary and phytosanitary measures (the US wants to) impose its own standards and replace international norms. In the case of Panama, it has already imposed its own standards as a pattern and that products are accepted, among others, with genetically modified organisms from the United States.

Another objective is to reduce or eliminate subsidies from other countries, although those from the US are the highest in the world. According to Mazzei, this goal is "steeped in cynicism." In 2012, the US subsidized its agricultural exports with US $ 139.5 billion. In the WTO, the US denounces India, which in 2010 spent US $ 58 billion in aid to its farmers. Each North American farmer receives US $ 58,000 in subsidies. In contrast, each farmer in India receives only US $ 98.


[1] US Senate Democrats impede debate on secret trade deal

In a surprising defeat for President Obama, senators from his own party prevented (on May 12) debate on a bill that would have given the president a fast track to negotiate the Trans-Pacific Strategic Economic Partnership Agreement ( TPP). The vote marked the triumph of Senate Democratic leader Harry Reid, Elizabeth Warren and other critics of the TPP, a twelve-country trade pact that would include 40 percent of the global economy and is being secretly negotiated between the United States and eleven other countries. from Pacific. Critics say the deal would hurt workers, weaken regulations and increase the power of big business. The fast track would grant the president the authority to negotiate the TPP and then present it to Congress so that it can be issued by itself or by no means, without the possibility of amendments. (From Democracy Now! May 13, 2015)

* Marco A. Gandásegui, Jr., professor of Sociology at the University of Panama and associate researcher at the Justo Arosemena Center for Latin American Studies (CELA).,


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