[Texgreen] Trade-Mexico: Staple Foods at Risk from Free Trade Market

[margaret]

http://www.ipsnews.net/news.asp?idnews=36728

Trade-Mexico: Staple Foods at Risk from Free Market
Diego Cevallos
InterPressService

MEXICO CITY, Feb 26 - When the Mexican government negotiated the North
American Free Trade Agreement (NAFTA), in force since 1994, it estimated
that 14 years of safeguards for its maize and beans would be enough 
time for
local production of these crops to become competitive. But things did 
not
work out that way.

In only 11 months' time the market for these products, the traditional
staple foods of Mexican consumers, will be wide open to receive maize 
and
beans from the other two NAFTA partners, Canada and the United States.

The tension is growing. The resources that were to improve agricultural
competitiveness have been frittered away, and the plans never worked.

The Felipe Calderon administration announced on Friday that to prepare 
for
the free market, it will grant farmers this year support in the amount 
of
640 million dollars.

The government promised that these funds, to be spent on advice to boost
competitiveness and on seeds and other back-up, will be additional to 
public
investment in rural areas, on healthcare and roads, for example, 
totalling
an unprecedented 16 billion dollars this year.

Furthermore, new inter-ministerial work and supervision strategies will 
be
adopted to face the challenge of free trade in maize and beans, grown by
3.7 million small farmers, the majority of whom are poor.

Calderon said he would propose to the governments of the United States 
and
Canada that a working group be created to find ways of mitigating the 
impact
of this extension of free trade in Mexico.

His goal is to secure the backing of these countries to improve 
production
and marketing of the Mexican crops, he said.

But Calderon's announcements have not satisfied small farmers'
organisations, opposition politicians and activists, who regard NAFTA 
as the
main cause of the problems in the rural areas, home to 30 million out 
of the
country's 104 million people.

Removing the tariff barriers will sound the death knell for rural 
workers,
said the National Peasant Federation (CNC), linked to the opposition
Institutional Revolutionary Party (PRI) which promoted, negotiated and
signed NAFTA in 1992, while it was still in power.

U.S. competition in the product categories to be liberated will be very
tough on Mexico. The maize yield in this country is about 2.3 tons per
hectare, compared with 7.2 tons per hectare in the United States, while 
U.S.
farmers produce 2.9 times more beans per hectare than Mexican farmers.

The United States subsidises its farmers at a level of over 19 billion
dollars a year, more than all of Mexico's rural sector funding sources 
put
together.

And Mexico is not self-sufficient in these food crops. In 2006 it had to
import 5.2 million tons of maize and 122,000 tons of beans, nearly all 
from
the United States, to cope with domestic demand.

Because NAFTA clauses allow these food imports by Mexico, some observers
argue that the market has in fact already been thrown open.

Small farmers' organisations want the Calderon administration to 
renegotiate
the treaty. However, the president is not considering this option.

Renegotiating the treaty is not the most promising approach, unless 
Mexico
wishes to offer concessions to its NAFTA partners in relation to 
products
like tomatoes, avocadoes and green vegetables, where this country 
already
has considerable advantages, regional integration expert and professor 
at
several universities German de la Reza told IPS.

NAFTA was negotiated en bloc, with joint and reciprocal commitments and
concessions in different product categories. "If a single element were 
to be
renegotiated now, the whole treaty would be at risk of falling apart, 
and
none of the partners wants that to happen," de la Reza said.

Former President Vicente Fox (2000-2006) broached the subject of
renegotiating the agricultural chapter of the treaty with the United 
States,
but the suggestion was rejected out of hand.

De la Reza hopes that the financial support for farmers announced on 
Friday
will be put to its proper use and not, as in the past, be distributed in
return for political backing.

Mexico should be able to honour its commitment to remove tariff 
barriers for
maize and beans in 2008, so long as enough support is given to farmers, 
de
la Reza said.

The main opposition force, the leftwing Party of the Democratic 
Revolution
(PRD), together with small farmers organisations and activists, are 
adamant
that opening maize and beans production to competition is suicide. They
blame NAFTA, which has been in force for 13 years, for the country's
agricultural problems.

In contrast, Braulio Serna, head of the agricultural development unit 
of the
Economic Commission for Latin America and the Caribbean (ECLAC)'s local
office, said that NAFTA does not affect Mexico's rural sector to a
significant extent.

In 2005, Serna presented an exhaustive study on Mexican agriculture in 
which
he claimed that only a biased view could point to free trade as a
determining factor in the country's agricultural performance.

Rural problems, poverty and mass migration are rather the effects of 
poor
public policies, global and national economic crises, climate factors, 
low
levels of education and training, and depressed international prices of 
a
number of agricultural goods, Serna said.

De la Reza also blames bad policies, going back to before NAFTA came 
into
effect. Governments have had 14 years to prepare for this challenge, and
they have done nothing.

With the barriers about to come down, small farmers are predicting yet
another crisis. (END/2007)

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