Public Citizen and Washington Office On Latin America: Peru and Colombia FTAs Projected to Increase Drug Trafficking, Violence and Instability in the Andes

By Public Citizen's Global Trade Watch

Download Full PDF

The Peru and Colombia FTAs Agriculture Provisions Will Devastate Millions of Peru and Colombia’s Small Farmers: Nearly one third of Peru’s population and over twenty percent of Colombian workers depend on agriculture for their livelihood. The Peru and Colombia “Free Trade Agreements” (FTAs) require those nations to cut tariffs on many basic agricultural goods, opening up their markets to imports of the same commodities from subsidized U.S. agribusiness. CONVEAGRO, a major Peruvian farmers group estimates that approximately 1.7 million Peruvian families will be immediately affected by these provisions. In Colombia, the Ministry of Agriculture and Rural Affairs conducted a study of the effects of liberalization on nine primary agricultural products and found that full liberalization would lead to a 35 per cent decrease in employment.

Experts Warn that the Colombia and Peru FTAs Will Lead to Increased Drug Production and Violence: Colombia and Peru are the top two producers of cocaine in the world, with Colombian cocaine representing two-thirds of the world’s supply. The Washington Post editorial board warned in February 2006 that the “rural dislocation that would follow from ending all protection for Colombian farmers could undermine the government’s efforts to pacify the countryside. If farmers can’t grow rice, they are more likely to grow coca.” As Nobel Prize-winning economist Joseph Stiglitz noted, the upheaval that such agreements will have on rural livelihoods is a self-defeating course that will mean “there will be more violence and the U.S. will have to spend more on coca eradication.” In the words of Archbishop Pedro Barreto, the President of the Episcopal Commission for Social Action of the Catholic Church in Peru, “We are certain that the trade agreement will increase the cultivation of coca, which brings along with it a series of negative consequences including drug trafficking, terrorism and violence.”

Increased Drug Production is Linked to Past NAFTA-style Agricultural Trade Policies on Which the Peru and Colombia FTAs are Based: We do not need to rely on experts’ opinions regarding how the proposed FTAs will lead to increases in drug production. Unfortunately, there is a factual record demonstrating the phenomena. After NAFTA drove down commodity prices in Mexico and eventually 1.3 million Mexican campesinos were driven out of the business of growing corn and beans, many Mexican farmers turned to illegal drugs to compensate for lost income. The U.S. Customs and Border Protection Office reports that in NAFTA’s first decade, marijuana seizures doubled at the U.S.-Mexico border. Peru and Colombia’s neighbor Bolivia provides another stark example; after Bolivia underwent significant trade liberalization in the 1980s, many poor farmers were unable to earn sufficient income from legal crops and cocaine production rose 13 percent each year for the first three years of this policy. Peru experienced a similar trend when the liberalization of the coffee market depressed prices, with the result that “[peasant farmers] started to re-activate their abandoned coca fields and coca cultivation again rose in Peru.”