US leans on Guatemala to enforce trade pact

The Obama administration's case against Guatemala, over its failure to protect unions within its borders, is seen as an attempt to garner US union support for stalled trade agreements.

Daniel LeClair/Reuters/File
A textile worker prepares finished clothing for shipping to the United States at a Korean owned factory in Guatemala City.
Rich Clabaugh/Staff

Trade agreements are increasingly difficult to pass in the United States, and their future may rest on a strategy the Obama administration is testing in the tiny Central American nation of Guatemala.

Seven years after Guatemala signed a free-trade pact with the US that included an agreement to enforce its labor laws, Guatemalan union leaders complain that they are still assassination targets, and that businessmen still illegally fire workers.

The apparent failure to protect union workers has prompted the US to take unprecedented steps to force Guatemala to respond, in what may be part of President Obama's broader strategy to win support from US unions and Democrats in Congress for stalled trade agreements with Colombia, Panama, and South Korea. Those deals are key to his bid to boost job creation via trade.

"It's an effort to send a signal to Obama's labor allies that the administration will enforce the labor provisions that are in trade agreements," says Christopher Sabatini, senior director of policy at the Americas Society and the Council of the Americas in New York.

'An anti-labor culture'

Despite the increased external pressure, Guatemalan union leaders say their government continues to exclude them from talks with the US. The country has a long history of aggression against organized labor, which is a common theme cited by opponents of new trade agreements, especially in Latin America.

"Union leaders continue to be assassinated," says Carlos Mancilla, secretary general of the CUSG union organization, whose home was riddled with bullets in 2007, presumably due to his union activities. He said investigators let 27 days pass before coming to inspect the scene, and no one was ever charged. "In Guatemala, there's an anti-union culture."

Business groups say violence against union members is a symptom of a surge in violence that has affected companies as well, but given the high levels of impunity in Guatemala, it is impossible to say exactly who is behind the assassinations and threats. The Public Ministry, comparable to an attorney general's office, rarely carries out a proper investigation into union murders, Mr. Mancilla says, and an AFL-CIO complaint says there is evidence that the government itself may have even been involved in at least one assassination.

US Trade Representative Ron Kirk requested a trade commission meeting with Guatemala in May under the Dominican Republic-Central America Free Trade Agreement (DR-CAFTA), which is the final step before bringing the matter before a settlement panel that has the authority to impose fines. This is the first labor case the US has ever brought against a trade partner.

The issue has the potential to affect the US presidential campaign, as Mr. Obama struggles to balance his strategy of creating more jobs through trade against his need to energize unions to support his reelection. It may also be a sign that the US labor movement has found a way to exert more influence in trade negotiations.

But Guatemala's weak judicial system and decades of entrenched government corruption may make it an odd test case. The military demobilization that followed the 1996 peace accords, which ended the country's 36-year civil war, left a vacuum that drug traffickers quickly filled.

Mancilla says the government has taken very little action since the AFL-CIO lodged its original complaint in 2008. That document contained five cases in which the Guatemalan government failed to enforce labor laws after it signed the DR-CAFTA. The complaint includes assassinations of union officers, firing of union organizers, and cases of company executives refusing to negotiate with unions.

"From the labor inspectorate, to the labor minister, to the courts, fundamentally it's broken down at every single level," said Jeff Vogt, the deputy director of the AFL-CIO, who helped write the Guatemala complaint.

Recent progress?

Rolando Figueroa, a legal adviser to Guatemala's textile industry who has helped craft labor strategy, says the dispute overlooks private-sector progress made in recent years. Illegal plant closures have been stopped, and companies worked with the government to strengthen labor courts, he says.

"At no point in time have private sector organizations in Guatemala supported the conscious illegal action of a company," he said in an interview. "We are the first to press our authorities to apply the law."

Union representation in Guatemala is low to begin with, he said, and the US should focus its attention on more important problems, such as rampant child labor, and the fact that 80 percent of the country's workforce toils in the informal sector, without any state protection. He denied that union membership rates are low because of intimidation.

Workers "don't want to use that system," he said. "They know it saps competitiveness and productivity from companies. People want to work."

Mancilla says he's certain that violence carried out against union leaders isn't just a symptom of the country's spike in crime.

"They say this is all a product of generalized delinquency," he says. "If that's so, then [let them] prove it. The Public Ministry should determine who is responsible."

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