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Women's Group Says Free Trade Will Hurt Caribbean Economies
The Washington Diplomat / July 2004

By Larry Luxner

Until just a few years ago, Jamaican dairy farmer Annette Dennis had four full-time employees. These days, business is so bad she can only afford one part-time worker.

The reason: cheap imports of powdered milk from Europe and the United States, a consequence of Jamaica's recent trade liberalization program.

"Three years ago, the processing companies that normally buy our milk reduced the amount they take by 40%. A year later, they reduced the price they pay us by 19%," said Dennis, a member of the Jamaica Dairy Farmers Federation. "The processors have decided to use powdered milk instead of fresh cow's milk because they can make more profit that way."

Dennis warns that thousands of Caribbean women like herself from poultry workers in Jamaica to banana pickers in St. Vincent will suffer deeply if protectionist barriers are eliminated under the proposed Free Trade Area of the Americas (FTAA).

She's one of several people who spoke at the Jamaican Embassy during a June 10 press conference organized by Women's Edge, a coalition of 40 nonprofit groups including well-known NGOs like United Methodist Women, Save the Children and Oxfam America.

"We work to influence U.S. policy on international trade and development issues," said Marceline White, trade director at Women's Edge. "Our objective is to insure that we promote positive alternatives to trade policies so that women can have more economic opportunities."

The group's opposition to free trade contradicts the pro-FTAA position by Washington organizations such as Caribbean Central American Action, which says the region's economy will benefit from the removal of trade barriers among the 34 nations of Latin America and the Caribbean.

"Overall, women would lose more jobs than they'd gain," said White. "Women are gaining jobs in the tourism sector and at hotels and restaurants, and that's fine. But the problem is that these are the lowest-wage jobs, while [better-paying] jobs are being lost in the free zones."

At its peak in 1995, Jamaican free trade zones (FTZs) in Kingston and Montego Bay employed more than 36,000 women, most of them involved in apparel and garment manufacturing for U.S. companies. The average age of a free-zone worker was 25, and nearly two-thirds of these women lived with their extended families or partners.

However, shortly after NAFTA came into being, many of those companies relocated from Jamaica to Mexico to maximize profits and take advantage of Mexico's sudden and unfettered access to the U.S. market. As a result, in 1996, Jamaica's exports to the United States fell 12% while Mexico's grew by 40%.

"Once NAFTA took effect, Jamaica lost about 16,000 free-zone jobs to Mexico, and those were priimarily young women with not a lot of education," said White, noting that many of these newly unemployed women became seamstresses, hair stylists, maids or market vendors known as "higglers."

But most of them didn't have enough money to start small businesses or the qualifications to land a formal job. And others, having worked for years in poorly lit and poorly ventilated factories, were left with poor eyesight and breathing problems, rendering them virtually unemployable.

White said "the jobs being promoted now don't lift people out of poverty" even though cheaper-priced food imports thanks to trade liberalization have reduced grocery bills for the average Jamaican family.

As a recipient of World Bank and International Monetary Fund loans, Jamaica in the early 1990s embarked on a course to open its economy and reduce the role of government in economic matters. Despite following World Bank and IMF structural adjustment policies, however, the country's economy has remained fairly stagnant while the government debt burden has now reached 150% of GDP.

Between 1993 and 2001, says Women's Edge, men gained jobs overall, while women lost them. It warns that "if the current draft of FTAA is implemented, Jamaican men stand to gain 50,000 jobs, while Jamaican women stand to lose 12,000 jobs between 2005 and 2009."

While the number of jobs lost isn't huge, said the group, "the jobs that are being created pay less than jobs being lost. And the shift in employment opportunities is distressing, given Jamaican women's critical role in maintaining and providing for households."

Working with the Trinidad-based Caribbean Association for Feminist Research and Action (CAFRA), Women's Edge assessed the economic, legal and regulatory impact of trade liberalization on Jamaica's poor and forecast the potential effects of an FTAA on Jamaicans living in poverty, particularly women.

"Since women are over-represented in the public sector, any layoffs in that sector will disproportionately affect women," it said. "By extension, since a large proportion of households are headed by women, the loss of a formal-sector job that provides health care, social security and other benefits has alarming implications for the well-being of the entire household, particularly for children in the home. This is especially true if the public-sector employee was the main breadwinner for the household."

Another area where a hemisphere-wide free trade agreement could harm women is agriculture.

In Jamaica, women account for more than half of all poultry workers. Women work as poultry farmers because raising chickens and turkeys in their backyards involves few start-up costs, and women traditionally have more difficulty gaining access to credits to launch a farming venture.

Under the WTO Agreement on Agriculture, Jamaica opened the door to imported agricultural products. Prior to that, it had already slashed import duties on poultry from as high as 200% to 40%. After import duties were lowered, U.S. poultry exporters flooded the island with cheaper poultry meat, putting nearly half of those backyard chicken farmers mostly women out of business.

In the eastern Caribbean, a WTO ruling that forced European countries to stop protecting the banana markets of their former island colonies has led to a dramatic decline in banana exports from such countries as Dominica, Grenada, St. Lucia and St. Vincent.

Folade Mutota, a CAFRA consultant who helped draw up the Women's Edge study, said "social dislocation has already become evident" in those countries, which have very high rates of poverty despite their small populations.

"Bananas have been the mainstay of these economies for decades," she said. "In Dominica, for example, in 1994 there were 4,840 banana farmers. By 2000, there were only 2,254, a drop of more than 50%. That has the ripple effects of unemployment, poverty and social dislocation, all as a result of the WTO rulings."

Mutota added that "women are particularly affected," because money from banana exports has often been used to pay for children's educations at universities in Barbados, Trinidad or Jamaica. Without those funds, education is suffering and many families have left their countries for Europe and Canada.

"We've been trying to prepare our economies for the coming of the FTAA, but what we have found is that free trade hasn't worked for us in the Caribbean," she said.

Among other things, the study urges the United States to create international trade adjustment assistance programs in countries that may be displaced by trade liberalization.

"With a very modest budget, the Women's Edge Coalition and CAFRA were able to study the effects of free trade in Jamaica and forecast potential impacts of FTAA for low-income Jamaicans, particularly women," it said. "The U.S. government spent $556 million for trade capacity-building efforts with developing countries in 2001. The U.S. government can afford to spend the relatively low time and money required to complete a poverty impact assessment. Indeed, if they want trade policies to benefit the poor here and abroad, they cannot afford not to do such assessments."

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