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These stories were published Thursday, Dec. 18, 2003, in Vol. 3, No. 250
Jo Stuart
About us
A.M. Costa Rica photo
The sun sets over Bello Horizonte. Can the dry season be far away?
A reader gives views on free trade here
Nation needs to wake up and smell the coffee
Our reader responds to news that Costa Rica has decided to delay or reject acceptance of a free trade pact with the United States.

By Beckie Spake*
Special to A.M. Costa Rica

In recent months, the Costa Rican media has been filled with stories regarding the pending free trade agreement between Central American countries and the United States, particularly how it affects Costa Rica. The focus of the articles is how this agreement will adversely impact Costa Rica. Will there be winners? Yes. Will there be losers? Yes. Will it move Costa Rican industry onto the world stage of international trade for perhaps the first time? You bet it will!

Costa Rica has for many years benefited from two trade agreements on U.S.A.-bound exports. First was the Caribbean Basin Initiative, in place since 1983. The purpose of the initiative was to promote trade and investment in the area by removing import duties on most products. The products do have to meet country-of-origin requirements as defined in the U.S. general rules of origin. These benefits are now permanent. There is no requirement for concessions from the countries involved; i.e. Costa Rica. They continue to place prohibitive duties on all imports.

The second is "most favored nation" status designed to level the playing field even more for "friends and neighbors" of the United States. 

The trade representatives will be moving on to South America next, and I suspect they have no intention of giving away the farm here, knowing full well that concessions here would have a negative impact elsewhere. It is time for the Costa Rican government to wake up and smell the coffee, or be left behind to suffer the consequences of being out in the cold concerning free trade.

The current status of stonewalling these talks only hurts the working Costa Rican populace, 

Four Central American nations do sign

Summary of trade pact contents


who pay the exorbitant import duties for the goods they want and/or need. The current 
duties on goods imported from the U.S. are based on CIF value, which is the product cost, insurance and freight. After the very high duties are applied, then sales tax is levied against the goods, adding another 13 percent to the "cost of goods."

If the importer is a distributor, when he sells the products to a retailer, another 13 percent tax is added to the cost. I think you know what happens when you buy the product.

The fact of the matter is, if Costa Rica continues its inaction regarding these free trade agreements, the government will be forced to increase taxes levied against its working populace, as well as cut itself off from outside assistance in the form of loans and grants from organizations such as the International Monetary Fund and the World Bank, as well as independently negotiated loans from foreign governments. The government recalcitrance will slowly erode the ability of the average citizen in Costa Rica to make a living.

That’s it, folks. I have been importing consumer goods into the United States from all over the world for 20 years. Current trade conditions in Costa Rica are not only illogical, but unfair to the world of international trade.

 *The writer operates Sea Island Distributors in Charleston, the U.S. state of South Carolina.

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Christmas vacations
already started in spirit

By the A.M. Costa Rica staff

The bulk of Costa Ricans already are on vacation, at least in spirit. Office parties, shopping excursions and friendly encounters seem to be encroaching into the work day.

However, the real vacation begins Friday. Do not stand in the door of any government office Friday about 4:30 p.m. for fear of being trampled.

This means that any important government activity must be completed either today or tomorrow morning. Most workers will not be back until Jan. 5.

Private businesses, too, are probably going to have a vacation at least from Christmas Eve until Jan. 5. Banks will be working limited hours. Downtown San José will be all but deserted, except for the horse parade Dec. 26 and the carnival Dec. 27.

The Registro Nacional closes Friday, too. That means no property transfers can be filed next week, but the online data base will be available.   The Registro also is where owners go to get permission to take their vehicle out of Costa Rica. The registry certifies ownership, among other facts.

Because a lot of residents travel elsewhere over the holidays, the Registro has special hours even though the rest of the activities there will be on hold. Vehicle owners can obtain certifications on Dec. 22, 23, 24, 29, 30 and 31, plus Jan. 2 from 7:30 a.m. to 3:30 p.m.

As always, the Judicial Investigating Agency will have its denuncia section open. This is the 24-hour-a-day, seven-day-a-week office where citizens and visitors can report crimes. The section is on the first floor of the Judicial Investigating Agency building that is the middle of three tall structures in the courts complex between avenidas 6 and 8 two blocks south of the Museo Nacional.

The courts generally will be closed, but some judges are on call or working restricted hours, particularly in the criminal courts.

A.M. Costa Rica will publish all weekdays except Thursday, Dec. 25, Christmas morning, and Jan. 1, New Year’s morning.

Lawmakers reject
U.S. shore leaves

By the A.M. Costa Rica staff

The U.S. sailors and coast guardsmen on duty catching drug shipments will have to have shore leave somewhere else.

The Asamblea Nacional Wednesday night rejected requests by the United States and the Ministerio de Gobernación, Policía y Seguridad Pública to let the ships dock on Costa Rican soil.  Some 20 ships are believed to be involved, and the Costa Rican Constitution requires assembly approval of a foreign military presence.

The assembly also rejected the landing of a Colombian military aircraft. Some said the lawmakers were irked at having to work late hours.

The assembly decision, which might be revisited, is a blow to tourism in Gofito and Puntarenas, two communities that cater to U.S. servicemen. The vessels are also believed to spend money in supplies and fuel.

Dollar declines
again against euro

By the A.M. Costa Rica wire services

The U.S. dollar reached another record low against the euro currency Wednesday while oil rose to its highest level since the beginning of the Iraq war. 

Oil gained another 46 cents to just under $34 a barrel. This is its highest level since just before the U.S.-led invasion of Iraq in March. Prices rose in New York in large part because U.S. oil inventories fell more than expected because of severe winter weather in the heavily populated northeast.

Oil has now risen by more than $5 a barrel, or 20 percent, since the Organization of Petroleum Exporting Countries agreed in September to cut supply by three percent. Oil is now priced above the upper limit of the price target range of $22 to $28 a barrel.

The euro continues its relentless rise, gaining nearly one U.S. cent to above $1.24. This is the 12th daily record high for the euro in the last 14 trading sessions. The euro is the single currency used by 12 European Union nations. 

They’ve got a list
but not for presents

By the A.M. Costa Rica staff

The Policía Metropolitana says it has captured 22 of a list of some 52 repeat offenders of violent crimes.

The officers are conducting a holiday cleanup of known robbers and muggers.

The latest person to fall into police hands had the last names of Arguello Berrocal. The man had been accused of robbery four times and has been arrested 41 times by Fuerza Pública officers, they said.

The cleanup is the strategy of Rogelio Ramos, minister of Gobernación, Policía y Seguridad Pública.

Also Wednesday afternoon, officers grabbed a man with the last names of Walteres Vargas after a man grabbed the earrings of a woman downtown. Walteres Vargas has faced six counts of robbery with violence against persons. 

Police also arrested José Alex Hidalgo Araya on the Paseo de los Estudiantes after they learned that he had escaped from the Centro Interinstitucional San Luis prison where he was serving 18 months for robbery, they said.

Police have been critical of the court system as they round up individuals who have faced justice multiple times for violent crimes yet still are on the streets.

Shooting in vain
at drug roadblock

By the A.M. Costa Rica staff

The occupants of a truck that police said was loaded with 102 kilos (224 pounds) of cocaine tried to shoot their way through a police roadblock about 6 a.m. Wednesday near Agua Buena de Coto Brus. Police shot out a tire and forced the vehicle to stop.

Fuerza Pública officers and agents of the Judicial Investigating Organization arrested those in the truck and occupants in a car that also tried to run the roadblock, they said.

Meanwhile, police confiscated some $90,000 near Golfito after they stopped a car and anti-drug dogs of the Policía de Control de Drogas indicated that the money had been in contact with an illegal substance. The three occupants were arrested.

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Zoellick is still hopeful
Free trade pact approved without Costa Rica
By the A.M. Costa Rica wire services
and special reports

WASHINGTON, D.C. — The United States has reached a free trade deal with four Central American countries after lengthy negotiations. 

U.S. Trade Representative Robert Zoellick said Wednesday that the agreement with Guatemala, Honduras, Nicaragua and El Salvador will tear down the tariff walls blocking free trade between the neighbors. 

The deal covers many areas, including textiles and agriculture, two highly contentious issues. It took nearly a year to finish the deal. 

Costa Rica, walked out of talks on Tuesday because of what it called excessive U.S. demands, mainly in attempting to open the domestic insurance and telecommunication markets.

Zoellick said he looks forward to including Costa Rica, which dropped out of the trade talks Tuesday, in the agreement once trade officials from that nation have had time for consultations and to work through a number of issues. He said that he would speak with Costa Rican Trade Minister Alberto Trejos next week.

The trade representative’s office said that talks with the Dominican Republic would begin immediately to bring that country into the agreement, too. The Dominican Republic was seen as a backup, if Costa Rica dropped out of the talks. That nation produces many of the same agricultural products and has a much stronger U.S. political presence, particularly along the U.S. East Coast.

The Bush administration is expected to submit the deal, called the Central American Free Trade Agreement, to Congress early next year. U.S. officials say they hope differences with Costa Rica can be resolved before then. 

Combined total goods traded between the U.S. and the four Central American free trade countries is $15.4 billion.

The United States already has free trade agreements with Mexico and Canada through the North American Free Trade Agreement  and a handful of other bilateral pacts. 

The new agreement comes only a few weeks after trade ministers from the entire Western Hemisphere except Cuba approved a framework for creating the world's largest free trade zone by 2005, the Free Trade Area of the Americas. 

World Trade Organization talks on forming a global free trade agreement collapsed in September. 

Trade talks began in January 2003 and at a press conference Tuesday Zoellick announced that negotiators from the United States and the Central American nations of El Salvador, Guatemala, Honduras and Nicaragua had reached a "top-quality, groundbreaking free trade agreement." He indicated that the agreement includes a set of ambitious commitments covering all economic areas.

Under the CAFTA, more than 80 percent of U.S. consumer and industrial exports and more than half of U.S. current agricultural exports will become duty-free in Central America immediately upon entry into force of the agreement, Zoellick said.

Textile and apparel is one of the largest components of U.S. trade with Central America, Zoellick noted, and innovative approaches within the trade pact will encourage factories in Central America to continue to use textiles and yarn from U.S. factories as well as materials from U.S. partners in the North American Free Trade Agreement, Canada and Mexico. This approach, he said, will support textile and apparel jobs in both Central and North America and allow hemispheric textile manufacturers to better compete globally.

The trade pact, Zoellick said, is not only ambitious and comprehensive, but flexible, allowing up to 15 years for Central American nations to phase out  agricultural tariffs, even longer in special cases.

The trade agreement, however, is about "much more than trade in goods," Zoellick said. He indicated that agreement will open markets for services in areas including energy, tourism, transportation, engineering, financial services, and entertainment. The agreement, Zoellick added, also recognizes the protection of intellectual property rights and includes top-notch commitments in the areas of investment, electronic commerce, government procurement, and labor and the environment.

Zoellick said the agreement’s high standards in areas such as intellectual property rights, services, transparency, labor and environment will serve as a world standard for such agreements.

Salvadoran Minister of Economy Miguel Lacayo hailed the conclusion of the trade talks. He said the agreement ushers in a "new future for our region" and "provides hope." Lacayo concurred with Zoellick that the trade pact is about more than trade. He said the agreement will modernize the region's economic systems, locking in rules and

preventing the future adoption of backwards policies. Lacayo said he was particularly pleased that the agreement is flexible and recognizes the different levels of development among trade partners. The agreement "fits our reality," he said.

Guatemalan Minister of Economy Patricia Ramírez said the pact "starts a new era, . . . an era of peace, trade, democracy and development." Mininster Ramírez said the agreement does not represent a panacea for the region, but a pillar to build on.

Mario Arana Sevilla, Nicaraguan minister of industry, development and trade said he believes the pact will bring his country the sustainable growth it has not had for the better part of the last two decades, increase competition and benefit Nicaraguan consumers.

Honduran Minister of Industry and Commerce Norman Garcia said he was pleased with the pact and that it will be up to Honduras and its tradepartners to ensure the success of the agreement.

The draft text of the agreement will be released in January. Under the U.S. Trade Act of 2002, the Bush administration must notify Congress at least 90 days before the president signs the agreement. The administration expects to notify Congress early in 2004 of its intent to sign CAFTA and will continue to consult with Congress to prepare for its consideration of the agreement.

Here is what the trade pact contains:

New Opportunities for U.S. Workers and Manufacturers: More than 80 percent of U.S. exports of consumer and industrial goods will become duty-free in Central America immediately, with remaining tariffs phased out over 10 years. Key U.S. export sectors will benefit, such as information technology products, agricultural and construction equipment, paper products, chemicals, and medical and scientific equipment.

Expanded Markets for U.S. Farmers and Ranchers: More than half of current U.S. farm exports to Central America will become duty-free immediately, including high quality cuts of beef, cotton, wheat, soybeans, key fruits and vegetables, processed food products, and wine, among others. Tariffs on most remaining U.S. farm products will be phased out within 15 years. U.S. farm products that will benefit from improved market access include pork, beef, poultry, rice, fruits and vegetables, corn, processed products and dairy products.

Textiles and Apparel: Textiles and apparel will be duty-free and quota-free immediately if they meet the Agreement's rule of origin, promoting new opportunities for U.S. and Central American fiber, yarn, fabric and apparel manufacturing. The agreement's benefits for textiles and apparel will be retroactive to January 1, 2004. An unprecedented provision will give duty-free benefits to some apparel made in Central America that contains certain fabrics from Mexico and Canada. This provision encourages integration of the North and Central American textile industries, and is a step to prepare for an increasingly competitive global market.

Access to Services: The Central American countries will accord substantial market access across their entire services regime, offering new access in sectors such as telecommunications, express delivery, computer and related services, tourism, energy, transport, construction and engineering, financial services, insurance, audio/visual and entertainment, professional, environmental, and other sectors. Central American countries have agreed to change "dealer protection regimes" and loosen restrictions that lock U.S. firms into exclusive or inefficient distributor arrangements.

A Trade Agreement for the Digital Age: State-of-the-art protections and non-discriminatory treatment are provided for digital products such as U.S. software, music, text, and videos. Protections for U.S. patents, trademarks and trade secrets are strengthened.

Strong Protections for Worker Rights: Goes beyond Chile and Singapore FTAs to create a three-part strategy on worker rights that will ensure effective enforcement of domestic labor laws, establish a cooperative program to improve labor laws and enforcement, and build the capacity of Central American nations to monitor and enforce labor rights.

An Innovative Environment Chapter: Goes beyond Chile and Singapore FTAs in seeking to develop a robust public submissions process to ensure that views of civil society are appropriately considered, and for benchmarking of environmental cooperation activities and input from international organizations.

Strong Protections for U.S. Investors: The agreement establishes a secure, predictable legal framework for U.S. investors in Central America.

Open and Fair Government Procurement: Provides ground-breaking anti-corruption measures in government contracting. U.S. firms are guaranteed a fair and transparent process to sell goods and services to a wide range of Central American government entities.

Summary of the new free trade agreement 
Special to A.M. Costa Rica

WASHINGTON, D.C. — The Office of the U.S. Trade Representative  has prepared a fact sheet on the U.S.-Central America Free Trade agreement reached Wednesday. Under the agreement, nearly all consumer and industrial products made in Central America will enter the U.S. duty-free immediately upon its entry into force, a spokesman said.

Free Trade With Central America Summary of the U.S.-Central America Free Trade Agreement

Central America is a large market for U.S. products. Current U.S. exports are more than $9 billion per year

New Market Access for U.S. Consumer and Industrial Products

More than 80 percent of U.S. exports of consumer and industrial products to Central America will be duty-free immediately upon entry into force of the Agreement, and 85 percent will be duty-free within five years. All remaining tariffs will be eliminated within 10 years.

Key U.S. exports, such as information technology products, agricultural and construction equipment, paper products, chemicals, and medical and scientific equipment will gain immediate duty-free access to Central America.

Guatemala, Honduras and Nicaragua will soon join the World Trade Organization’s Information Technology Agreement, which removes tariff and non-tariff barriers to IT products. Costa Rica and El Salvador are already participants.

Under the U.S. Caribbean Basin Trade Partnership Act, many products from Central America already enter the United States duty-free. The Central American Free Trade Treaty will consolidate those benefits and make them permanent, so that nearly all consumer and industrial products made in Central America will enter the U.S. duty-free immediately on effectiveness of the agreement.

New Opportunities for U.S. Farmers and Ranchers

More than half of current U.S. farm exports to Central America will become duty-free immediately, including high quality cuts of beef, cotton, wheat, soybeans, key fruits and vegetables, processed food products, and wine, among others. 

Tariffs on most U.S. farm products will be phased out within 15 years. U.S. farm products that will benefit from improved market access include pork, beef, poultry, rice, fruits and vegetables, corn, processed products and dairy products.

U.S. farmers and ranchers will have access to Central American countries that is generally better than suppliers in Canada, Europe and South America.

The U.S. and Central America will work to resolve sanitary and phytosanitary barriers to agricultural trade, in particular problems and delays in food inspection procedures for meat and poultry. Central America will move toward recognizing export eligibility for all plants inspected under the U.S. food safety and inspection system.

Textiles and Apparel

Textiles and apparel will be duty-free and quota-free immediately if they meet the agreement's rule of origin, promoting new opportunities for U.S. and Central American fiber, yarn, fabric and apparel manufacturing. The agreement's benefits for textiles and apparel will be retroactive to Jan. 1, 2004.

An unprecedented provision will give duty-free benefits to some apparel made in Central America that contains certain fabrics from North American Free Trade Agreement partners Mexico and Canada. This new provision encourages integration of the North and Central American textile industries, and is a step to prepare for an increasingly competitive global market.

Apparel containing certain fabrics and materials in "short supply" in the U.S. and Central America may also qualify for duty-free treatment. An expanded list of such "short supply" materials was developed in consultation with industry in the U.S. and Central America. U.S. yarn and fabric will receive reciprocal treatment in Central American apparel entering Mexico and Canada.

A "de minimis" provision will allow limited amounts of third-country content to go into Central American Free Trade Treaty apparel, giving producers in both the U.S. and Central America needed flexibility.

Open Services Markets Across the Region

The Central American countries will accord substantial market access across their entire services regime, subject to very few exceptions, using the so-called "negative list" approach.

Central American countries have agreed to dismantle significant distribution barriers. Changes in the "dealer protection regimes" will loosen restrictions that lock U.S. firms into exclusive or inefficient distributor arrangements. Such laws have been used to ban imports of U.S. products when a dispute arose with a local distributor.

Market access commitments apply across all sectors, including but not limited to:

-- Telecommunications services 
-- Financial services, including banking, insurance and securities 
-- Distribution services, such as wholesaling, retailing and franchising -- Express delivery services 
-- Computer and related services 
-- Audiovisual and entertainment services 
-- Energy services 
-- Transport services 
-- Construction and engineering services 
-- Tourism 
-- Advertising services 
-- Professional services (architects, engineers, accountants, etc.) 
-- Environmental services

U.S. financial service suppliers have full rights to establish subsidiaries, joint ventures or branches for banks and insurance companies.

The Central American Free Trade Treaty will build momentum toward hemispheric free trade. The U.S. will begin work in January 2004 to integrate the Dominican Republic into the Central American Free Trade Treaty.

Removes most local residency requirements, which had imposed significant barriers to U.S. professionals.

Central America will allow U.S.-based firms to supply insurance on a cross-border basis, including reinsurance; reinsurance brokerage; marine, aviation and transport (MAT) insurance; and other insurance services.

Central America will allow U.S.-based firms to offer services cross-border to Central Americans in areas such as financial information and data processing, and financial advisory services. In addition, Central American mutual funds will be able to use foreign-based portfolio managers.

The commitments in services cover both cross-border supply of services (such as services supplied through electronic means, or through the travel of nationals) as well as the right to invest and establish a local services presence.

Market access to services is supplemented by requirements for regulatory transparency. Regulatory authorities must use open and transparent administrative procedures, consult with interested parties before issuing regulations, provide advance notice and comment periods for proposed rules, and publish all regulations.

The financial services chapter includes core obligations of non-discrimination, most-favored nation treatment, and additional market access obligations. It also includes additional provisions on transparency of domestic regulatory regimes.

E-Commerce: Free Trade in the Digital Age

Central America and the United States agreed to provisions on e-commerce that reflect the issue's importance in global trade and the importance of supplying services by electronic means as a key part of a vibrant e-commerce environment.

-- All parties committed to non-discriminatory treatment of digital products; agreed not to impose customs duties on such products and to cooperate in numerous policy areas related to e-commerce.

Important New Protections for U.S. Investors in the Region

-- The agreement will establish a secure, predictable legal framework for U.S. investors operating in the Central American countries.

All forms of investment are protected under the agreement, including enterprises, debt, concessions, contracts and intellectual property. 

U.S. investors enjoy in almost all circumstances the right to establish, acquire and operate investments in the Central American countries on an equal footing with local investors, and with investors of other countries, unless specifically stated otherwise.

Pursuant to U.S. Trade Promotion Authority, the agreement draws from U.S. legal principles and practices to provide U.S. investors in the Central American countries a basic set of substantive protections that Central American investors currently enjoy under the U.S. legal system.

Among the rights afforded to U.S. investors (consistent with those found in U.S. law) are due process protections and the right to receive a fair market value for property in the event of an expropriation.

Investor rights are backed by an effective, impartial procedure for dispute settlement that is fully transparent. Submissions to dispute panels and panel hearings will be open to the public, and interested parties will have the opportunity to submit their views.

State-of-the-Art Protection for U.S. Trademarks

Requires a system to resolve disputes about trademarks used in Internet domain names, which is important to prevent "cyber-squatting" with respect to high-value domain names.

Applies principle of "first-in-time, first-in-right" to trademarks and geographical indications, so that the first person who acquires a right to a trademark or geographical indication is the person who has the right to use it.

Encourages the development of an on-line system for the registration and maintenance of trademarks, as well as a searchable database.

Requires transparent procedures for the registration of trademarks, including geographical indications.

Protection for Copyrighted Works in a Digital Economy

Copyright owners maintain rights over temporary copies of their works on computers, which is important in protecting music, videos, software and text from widespread unauthorized sharing via the Internet.

Establishes that only authors, composers and other copyright owners have the right to make their work available on-line.

Ensures extended terms of protection for copyrighted works, including phonograms, consistent with emerging international trends.

Establishes strong anti-circumvention provisions to prohibit tampering with technologies (like embedded codes on discs) that are designed to prevent piracy and unauthorized distribution over the Internet.

Ensures that governments use only legitimate computer software, thus setting a positive example for private users.

Requires rules to prohibit the unauthorized receipt or distribution of encrypted satellite signals, thus preventing piracy of satellite television programming.

Provides rules for the liability of Internet service providers for copyright infringement, reflecting the balance struck in the U.S. Millennium Copyright Act between legitimate Internet service provider activity and the infringement of copyrights.

In all categories of intellectual property rights, U.S. companies will be treated at least as well as Central American companies, and the agreement makes a number of important improvements to intellectual property rights protections.

Patents & Trade Secrets: Stronger Protections

Provides for the extension of patent terms to compensate for delays in granting the original patent, consistent with U.S. practice.

Limits the grounds for revoking a patent, thus 

protecting against arbitrary revocation.

Clarifies that test data and trade secrets submitted to a government for the purpose of product approval will be protected against unfair commercial use for a period of five years for pharmaceuticals and 10 years for agricultural chemicals. Closes potential loopholes to these provisions.

Requires a system to prevent the marketing of pharmaceutical products that infringe patents.

Provides protection for newly developed plant varieties.

Tough Penalties for Piracy and Counterfeiting

Criminalizes end-user piracy, providing strong deterrence against piracy and counterfeiting.

Requires all parties to authorize the seizure, forfeiture, and destruction of counterfeit and pirated goods and the equipment used to produce them. Also provides for enforcement against goods-in-transit, to deter violators from using ports or free trade zones to traffic in pirated products. Ex officio action may be taken in border and criminal cases, thus providing more effective enforcement.

Mandates both statutory and actual damages for copyright infringement and trademark piracy. This serves as a deterrent against piracy, and ensures that monetary damages can be awarded even when it is difficult to assign a monetary value to the violation.

New Access to Government Procurement Contracts

U.S. suppliers are granted non-discriminatory rights to bid on contracts from Central American government ministries, agencies and departments. Low-value contracts are excluded.

Covers the purchases of most Central American central government entities, including key ministries and state-owned enterprises.

Requires fair and transparent procurement procedures, such as advance notice of purchases and timely and effective bid review procedures.

Ensures that bribery in government procurement is specified as a criminal offense under Central America and U.S. laws.

The Central American Free Trade Treaty will lock in economic reforms, strengthen the rule of law, promote good governance and strengthen democratic institutions in Central America.

Groundbreaking Customs Procedures and Rules of Origin

Comprehensive rules of origin will ensure that only U.S. and Central American goods benefit from the agreement. Rules are designed to be easier to administer.

Agreement requires transparency and efficiency in administering customs procedures, including the Central American Free Trade Treaty rules of origin. Central American countries commit to publish laws and regulations on the Internet, and will ensure procedural certainty and fairness.

Both parties agree to share information to combat illegal trans-shipment of goods. In addition, the agreement contains language designed to facilitate the rapid clearance through customs of express delivery shipments.

Protection and Promotion of Worker Rights

The Central American Free Trade Treaty fully meets the labor objectives set out by Congress in the Trade Promotion Act of 2002 and makes labor obligations a part of the core text of the trade agreement.

Includes unprecedented provisions that commit Central American Free Trade Treaty countries to provide workers with improved access to procedures that protect their rights.

The Central American Free Trade Treaty goes beyond Chile and Singapore free trade agreements through a three-part cooperative approach to improve working conditions by:

1. Ensuring effective enforcement of existing labor laws.

Agreement requires that all parties shall effectively enforce their own domestic labor laws, and this obligation is enforceable through the Agreement's dispute settlement procedures.

2. Working with the International Labor Organization to improve existing labor laws and enforcement.

International Labor Organization found that Central American nations have laws on the books that are largely consistent with International Labor Organization core labor standards.

Central American governments are now working to address gaps between existing laws and International Labor Organization recommendations.

For example, in response to the recent International Labor Organization report, several Central American countries have already drafted new legislation and regulations, dramatically increased funding for their labor ministries, expanded the number of labor inspectors, and streamlined procedures for creating unions.

Costa Rica, El Salvador, Guatemala and Nicaragua have each carried out major revisions of their labor codes over the last decade.

All parties reaffirm their obligations as members of the International Labor Organization, and shall strive to ensure that their domestic laws provide for labor standards consistent with internationally recognized labor principles.

Agreement clearly states that it is inappropriate to weaken or reduce domestic labor protections to encourage trade or investment.

A comprehensive three-part strategy to improve worker rights in Central America.

3. Building local capacity to improve worker rights.

The Central American Free Trade Treaty includes a groundbreaking cooperation mechanism to promote labor rights through specialized consultations and targeted training programs in the areas of child labor, public awareness of worker rights, and labor inspection systems.

Public participation, including the input of worker and employer organizations, is called for in the design and implementation of technical cooperation activities.

As part of the Central American Free Trade Treaty process, the U.S. Department of Labor has allocated $6.7 million to educate Central Americans on core labor standards and to improve the administrative capacity of the Central American Free Trade Treaty countries in labor matters.

The U.S. Department of Labor will also support efforts aimed at reducing exploitative child labor. Through the International Labor Organization's program to eliminate the worst forms of child labor, U.S.-funded projects will remove children from hazardous and exploitative work and provide them with educational opportunities.

Commitments and Cooperation to Protect the Environment

-- Agreement fully meets the environmental objectives set out by Congress in TPA. Environmental obligations are part of the core text of the trade agreement.

The Central American Free Trade Treaty goes beyond Chile and Singapore free trade agreements in seeking to develop groundbreaking new provisions that would:

-- Develop a robust public submissions process to ensure that views of civil society are appropriately considered.

-- Envision benchmarking of environmental cooperation activities and input from international organizations in evaluating progress.

-- Enhance the mutual supportiveness of multilateral environmental agreements and the free trade agreement.

Agreement commits parties to effectively enforce their own domestic environmental laws, and this obligation is enforceable through the Agreement's dispute settlement procedures.

There is also an environmental cooperation agreement that provides a framework for undertaking environmental capacity building in the Central American Free Trade Treaty countries and establishes an Environmental Cooperation Commission.

This is the first time that the cooperation agreement has been concluded at the time of the free trade agreements. The Chile and Singapore cooperation packages were negotiated after those trade agreements were concluded. The parties will now work on developing a work plan for cooperative activities.

The environmental cooperation agreement identifies a number of priorities:

-- Strengthening the capacity to develop, implement and enforce environmental laws; 
-- Promoting incentives to encourage environmental protection; 
-- Protection of endangered species; 
-- Promotion of clean production technologies; 
-- Building capacity to promote public participation in the environmental decision-making process.

Both parties commit to establish high levels of environmental protection, and to not weaken or reduce environmental laws to attract trade and investment.

Agreement also promotes a comprehensive approach to environmental protection, procedural guarantees that ensure fair, equitable and transparent proceedings for the administration and enforcement of environmental laws are married for the first time with provisions that promote voluntary, market-based mechanisms to protect the environment.

Dispute Settlement: Tools to Enforce the Central American Free Trade Treaty

Core obligations of the agreement, including labor and environment provisions, are subject to the dispute settlement provisions of the Agreement.

Dispute panel procedures set high standards of openness and transparency:

-- Open public hearings; 
-- Public release of legal submissions by parties; 
-- Special labor or environment expertise for disputes in these areas; 
-- Opportunities for interested third parties to submit views.

Emphasis is on promoting compliance through consultation, joint action plans and trade-enhancing remedies.

An innovative enforcement mechanism includes monetary penalties to enforce commercial, labor and environmental obligations of the trade agreement.

Trade Capacity-Building: Development and Trade Together

In a first for any free trade agreement, the Central American Free Trade Treaty will include a Committee on Trade Capacity Building, in recognition of the importance of such assistance in promoting economic growth, reducing poverty, and adjusting to liberalized trade.

The trade capacity building committee will build on work done during the negotiations to enhance partnerships with international institutions (Inter-American Development Bank, World Bank, Organization of American States, ECLAC, and the Central American Bank for Economic Integration), non-governmental organizations, and the private sector.

This year, in response to the needs identified by the Central American countries, the U.S. Government provided more than $61 million in trade capacity building assistance. Since the launch of negotiations, the Inter-American Development Bank has approved more than $320 million in Central American Free Trade Treaty-related operations.

Private and non-government organizations joined in the effort on trade capacity building. The Humane Society of the United States developed "The Central American Free Trade Treaty Alliance" partnership to promote environmentally sustainable and humane agricultural programs, as well as the protection of wildlife and habitat. The City of New Orleans and the State of Louisiana worked with local universities and entrepreneurs to establish "Idea Village International," an institute to train entrepreneurs in Central America.

The U S. government provided more than $61 million in trade capacity building assistance in 2003.

U.S. Protect Act tightens the screws on pedophiles
Special to A.M. Costa Rica

WASHINGTON, D.C. — President Geroge Bush signed into law last April 30 the Protect Act aimed at strengthening U.S. law enforcement's ability to prevent, investigate, prosecute and punish violent crimes committed against children. Many of the provisions of the Protect Act focus on protecting children within the United States, but the new law also reaches well beyond U.S. borders to help protect young people and combat child sex tourism.

Since the law was enacted, eight U.S. residents have been placed in federal custody on charges of child sex tourism. U.S. Immigration and Customs Enforcement, which is the largest investigative arm of the Department of Homeland Security, conducted the investigations leading to these arrests. Formed in 2003, Immigration and Customs Enforcement has the lead in investigating cases related to child sex tourism and pornography, alien smuggling, human trafficking and other crimes affecting young people.

"In addition to the indictments brought under the new provisions, there are many more investigations in the works," Immigration and Customs Enforcement spokesman Dean Boyd said this week. With investigators based in 25 major offices throughout the United States and Immigration and Customs Enforcement attaches based in 32 U.S. embassies around the world, the agency draws on a full spectrum of cyber, intelligence, investigative, and detention and removal functions to target those who exploit children, said Boyd.

Under the Protect Act, conviction would result in a mandatory 30-year imprisonment for each offense related to the sexual exploitation of children, double the previous penalty. In addition, U.S. investigators have enhanced authority and resources to identify and prosecute U.S residents who prey on minors anywhere.

Immigration and Customs Enforcement, in cooperation with the Department of State and non-governmental organizations, is expected to launch a public service campaign in the near future, including the distribution of informational material on international flights, to educate U.S. residents about their responsibilities under the Protect Act.

A brief look at current indictments points to the key provisions of the new law and illustrates U.S. efforts to work with foreign governments to curb the exploitation of their children and citizens:

The cases:

On Sept. 24, Michael Lewis Clark, a 69-year-old U.S. citizen, was indicted in U.S. federal court on charges of engaging in sexual conduct with two young males, approximately 10 and 13 years old, while visiting Phnom Penh, Cambodia.

According to court documents, Clark flew to Cambodia from Seattle in May 2003 and was arrested in June by the Cambodian National Police for alleged debauchery. Subsequent investigations revealed Clark had spent considerable time in Cambodia since 1998, allegedly soliciting sex with boys along a riverfront area of Phnom Penh. Clark may have molested as many as 50 children over the past several years, according to a Sept. 24 Immigration and Customs Enforcement press release. Clark was returned to the United States and remains in federal custody pending trial.

Boyd said the investigation leading to Clark's arrest reflected the joint efforts of Cambodian law enforcement officials; Immigration and Customs Enforcement investigators in Seattle, Washington, and Bangkok Thailand; the U.S. embassy; the Australian federal police; and a non-profit agency in Cambodia dedicated to assisting children in need. 

Similar joint efforts led to a second indictment in November 2003. Gary Evans Jackson, a resident of Seattle, was charged with three counts of traveling abroad and engaging in illegal sexual conduct with minors. The charges stemmed from allegations that he engaged in sex with three Cambodian boys, again one boy as young as 10 years old. He is alleged to have taken digital photos of the activity, prompting a U.S. government agent in Phnom Phen
to conduct interviews at an Internet cafe 

frequented by Jackson where materials containing images of illicit sexual contact with Cambodian children were seized.

The Protect Act was also cited in the indictment of John W. Seljan, arrested in October 2003 as he was preparing to board an international flight to the Philippines. According to Immigration and Customs Enforcement press statements, Seljan, 85, was allegedly en route to engage in sex with two Philippine girls, ages 9 and 12.

"Some pedophiles are motivated to commit child sex crimes overseas because they believe foreign child sex laws are less strict than ours," said Lorain Brown, special agent-in-charge for Immigration and Customs Enforcement investigations in Los Angeles. "ICE and the Department of Homeland Security are working around the clock to identify these people and hold them accountable wherever they seek to commit these heinous crimes."

Spokesman Boyd underscored the seriousness of the Immigration and Customs Enforcement teams in pursing the kinds of tips that point to criminal activities that harm children. He praised the partnerships that are developing between the Immigration and Customs Enforcement and international law enforcement officials, particularly in Mexico, Cambodia, Thailand and the Philippines, and also with the grassroots non-profit agencies concerned with ending the exploitation of children in their communities.

The changes:

The Protect Act enhances law enforcement efforts to combat child sex tourism in several new ways, according to Perry Woo, senior special agent at the Cybercrimes Center of the Immigration and Customs Enforcement here.

-- U.S. prosecutors no longer have to prove the accused traveled abroad with the intent of having sex with minors. Showing intent is no longer necessary. The accused is subject to the full force of U.S. law if they attempted to or engaged in sexual conduct with children under age 18 in foreign places.

-- Individuals legally residing in the United States as well as U.S. citizens can face federal charges under the Protect Act. This means international students, Green Card holders, trainees and other legitimate guests of the United States may be charged in U.S. federal courts for illicit sexual conduct with minors.

-- The law goes after child sex tour operators and their co-conspirators. Prior to April 2003, only the actual sex exploiters and the principals involved in organizing the illicit business were held accountable. Under the Protect Act, anyone involved in furthering the illicit acts is accountable. For example, a business that hosts a child sex tourism Web site or advertises or facilitates the activity in other ways can be prosecuted.

-- Those indicted under the Protect Act face a maximum sentence of 30 years for each offense, double the previous penalty.

The U.S. government estimates 800,000 to 900,000 human beings are bought, sold or trafficked throughout the world each year. Among them are hundreds of thousands of teenagers, and others as young as 5 years old, who fall victim to the sex trade.

More information on the domestic and international work of U.S. Immigration and Customs Enforcement is available at www.ice.gov Information on efforts to combat child sex tourism under the Immigration and Customs Enforcement initiative "Operation Predator" is available here.

The Immigration and Customs Enforcement maintains an international, toll-free telephone number to report suspected child exploitation perpetrated by U.S. residents. The hotline number is 1-866-347-2423. Information can also be e-mailed to investigators at c3@dhs.gov

A Department of Justice fact sheet on the provisions of the Protect Act is available here.

The Office to Monitor and Combat Trafficking in Persons at the Department of State coordinates interagency efforts to combat trafficking; the annual trafficking in persons report is found here.

Jo Stuart
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