FTAs - The Death of Rural Farming
The reality in the countries which have signed FTAs with the United States is far from the ‘beacon of hope' which was promised by the neo-liberal economists. Mexico is the most relevant country for evaluating the effects of ‘free trade,' since they signed the North American Free Trade Agreement (NAFTA) with the United States and Canada in 1994, and provides the opportunity to assess 12 years of impacts.
Behind the increase in exports, studies demonstrate that FTAs have wiped out the major part of small and medium size industry, which is the sector that generated formal jobs. It also destroyed the existing production chains without creating others and pushed forward the de-nationalization of large industries liked to the export sector.
But perhaps the most egregious impact of this ‘commercial liberalization' policy has occurred in the countryside. Some writers speak clearly and straightforwardly about the ‘destruction of the Mexican countryside.'
From being self sufficient in basic foods, Mexico began to import 40% of the grains and oilseeds it consumes: between 1994 and 2000, rice imports increased 242%, corn 112%, wheat 84%, soy 75%, sorghum 48%, and beef 247%. As a result, in the last eight years, 1.8 million jobs have been lost in the agriculture sector. This has produced a huge spike in rural migration not only to temporary jobs in irrigated fields, but also a massive migration to cities, and principally to the United States. This mass exodus is estimated at 5 million Mexicans and the United States ‘resolves' the problem by building a wall on the border.
Recently a newspaper article warned: "The option of living in the countryside for the grand majority of the thousands of rural producers is now in doubt. The winners in this scene are no more than a thousand people, as compared to millions of losers".
As an example: in May of 2002, the US approved the Food Security and Rural Investment Law, which raises by almost 80% the direct aid to agriculture, with a package of more than $180 million over 10 years. In Peru, where they have just signed an FTA with the US, it is calculated that 97% of the communities, collectives and cooperatives will be wiped out by the agreement, because it will permit the free entry of wheat, cotton, soy, and other agricultural products, including oils and beef.