Costa Rica Ratifies CAFTA-DR

By a slim majority, voters in Costa Rica have ratified the Central America-Dominican
Republic Free Trade Agreement (CAFTA-DR). The vote followed contentious debates over the pact’s
purported benefits. 

Costa Rica is the last nation to ratify the agreement. Initially passing by a very
slim margin in the US Congress in 2005, it was ratified in 2006 by El Salvador, Guatemala, Honduras
and Nicaragua; and early this year by the Dominican Republic.

CAFTA-DR’s package of 13 laws includes bills that open Central American markets —
among them Costa Rica’s state telecommunications and insurance monopolies, and domestic service and
agricultural sectors — to foreign competition. Opponents of the pact fear this market
liberalization will bring a flood of cheap US farm imports, potentially putting rural farmers out
of work. As part of the agreement, the United States has promised increased market access for some
Central American sectors, including textiles.

 “We are pleased that Costa Rica will be joining the other CAFTA-DR countries
in reaping the benefits of greater regional economic integration and market opportunities that the
CAFTA-DR provides,” said United States Trade Representative Susan C. Schwab. “We look forward to
working with the Government of Costa Rica as it completes the necessary steps to implement the
agreement, so that the CAFTA-DR can enter into force for Costa Rica as soon as possible.”<

November/December 2007