Does the EU want more than a Free Trade Agreement with Central America?

High social vulnerability, unequal income distribution, high poverty rates and a lack of political answers to the problems in Central America are some of the challenges the European Union highlight in their initial analysis to the forthcoming regional strategy.

By Jakob Anker Tvede

23. June 2005

High social vulnerability, unequal income distribution, high poverty rates, slow economic development, and a lack of political answers to the growing problems in Central America are some of the challenges that the European Union highlight in their initial analysis to the forthcoming regional strategy 2007 – 2013 - an analysis few would agree to. 

It therefore seems plausible that the EU in the regional strategy draft paper, proposes to concentrate its regional strategy 2007 – 2013 on creating a road-map towards the creation of an Association Agreement, which in addition to a free trade agreement between the two regions, also consists of political dialogue, cooperation. An integral perspective that provides a sense of comfort that the European Union intends to represent a different development approach in the region than that of the US, the latter historically characterized by militarized interventionism, US security (cold war, drugs, terrorism), and economic and commercial agendas combined with some political arm twisting. 

Other factors further strengthen hopes that the European Union has an interest in the region that goes beyond signing a free trade agreement.

Firstly, historically, the European Union has traditionally played a crucial political role in the conflict resolution, peace keeping and democratic development in the region. Since the mid 80’s, this has created a sense of mutual commitment and confidence between political decision makers of the two regions, which could provide a strong foundation for continuing the political dialogues between the representation of the European Commission and regional public servants. 

In particular the declaration of the Ministerial Summit in Guadalajara, Mexico, in May 2004 spells out the need to prevent and eradicate poverty and exclusion and promote the integration and participation of all in economic and social life, and that economic growth alone will not solve the problems of the region. This means that there is a shared commitment between EU and Central American political leaders to place social cohesion at the heart of the bi-regional relationship.

Secondly, the European Union as the only multilateral organization insists on strategy with a regional perspective. This should improve the conditions for greater Central American coherence and provide better conditions for common internal and external agenda setting between the countries. 

In addition, the vast experience of the European Union within regional integration, including harmonization processes and common policy-making and decision making bodies etc., may offer valuable lessons to the Central American integration process. This is important at a time when internal and external factors currently threaten to weaken the regional integration process in Central America.

Thirdly, the EU has demonstrated more willingness to approach and consult civil society, than other multilateral organizations or national governments. Recently they underscored this, inviting civil society organizations to discuss the draft strategy papers for each of the countries and the regional draft paper. MS CA participated together with several partner organizations.

All in all, past experience and various mutual political framework agreements indicate immediate sincere intentions that leave hopes for an ambitious relationship between the two regions, and upon which the new regional strategy must build upon. This is therefore also the backdrop against which to hold Central American and particularly European political decision makers accountable for what they prioritize and accomplish and what they do not. 

Unfortunately, those apparent positive tones meet reluctance among European and Central American civil society, and perhaps with due reason. The European Delegation in its the regional draft paper, does not successfully manage to bridge the analysis of regional challenges (as stated in the beginning of this article) with its proposed strategy, and therefore does not explain how the European Union will prioritize and work with the identified challenges. Rather, the current draft heavily focuses on institutional, economic and commercial characteristics of regional integration, reducing political dialogue and cooperation to a minimum. 

Therefore presently, civil society organizations from both regions are left with a bitter sour taste: on one hand the consultations represent positive tones in a region where tradition for involving civil society is very incipient and often rooted in deep mistrust. On the other hand, they have no clear idea about what direction the European Union wants to go with its current proposal. 

The question is whether the mistake is of methodological character or if the regional draft is a signal from the European Commission marking new priorities in European - Central American relations.

Regardless, the message from the Civil Society organizations was clear, “Whatever, political initiative that confirms or reinforces current unjust structure of wealth and power is not acceptable”.

Another, question is to what degree the Commission will be susceptible to the comments and suggestions made by the civil society organizations and how the next draft version of the strategy will reflect this. A recent joint communication from the 21st Ministerial Dialogue of San José stresses the importance of civil society participation in regional integration processes, but the modality for participation has not yet been unveiled. 

The actual negotiations of an Association Agreement are scheduled to initiate in May 2006. The European Union has decided that decision on whether to initiate the negotiations depends on the one hand on the level of regional integration in Central America – something which a team of European consultants will analyze. Secondly, the European Union has set the completion of the WTO Doha Round as a condition for launching the negotiations.

That is why MS Central America together with partner organizations and other European NGO’s will continue to follow the development of the WTO negotiations and the 2007 – 2013 strategy formulation process of the European Union.

Links from text:

Declaration of the XXI San José Dialogue, May 2005: http://ue.eu.int/ueDocs/cms_Data/docs/pressData/en/er/84973.pdf 
Guadalajara Declaration, May 2004: http://europa.eu.int/comm/world/lac-guadal/declar/01_decl_polit_final_en.pdf 

EU on Social Cohesión: http://europa.eu.int/comm/external_relations/la/sc/sc_en/04_analysis_en.htm

[1] http://europa.eu.int/comm/external_relations/la/sc/sc_en/01_what_en.htm