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A glance at EU - Latin America relations

Newsletter EU-CA Association Agreement



 
 
 
The European Union and Central America (Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama) signed a comprehensive Association Agreement (AA) in July 2012. This agreement is based on three pillars: political dialogue, cooperation and trade, and aims to support economic growth, democracy and political stability in Central America. This agreement is particularly important because it provides the framework via which trade relations between the two regions are based, and establishes the future legal framework for EU-Central America relations once the pillars of cooperation and political dialogue are approved.

ACT Alliance EU and CIFCA have been monitoring the Association Agreement. We participate in the civil society spaces established in the agreement, including meetings which will be held soon in Honduras, and we monitor the impacts of the AA on the population.

In this issue of our newsletter, you will find four articles which aim to contribute to an understanding and analysis of the topic at hand. The first article presents the aforementioned meetings and events which will be held in Honduras. The second article offers answers to a series of frequently asked questions on the Association Agreement. We also present a brief introductory discussion on European investment in Central America. The final article details research on Finnfund and the FMO in the Agua Zarca hydroelectric project, written by Ever Guillen from We Effect, a CIFCA member organisation.
 
We hope you enjoy reading the newsletter!

Events

June, 13th: Discussion on European Union justice and security programmes in Honduras. Tegucigalpa, Honduras.

June, 14th - 15th
Visit to Brussels of Economic, Social and Cultural Rights defensors. Brussels, Belgium.

June, 14th: Forum of European and Central American Social Movements and Civil Society in Honduras. Tegucigalpa, Honduras.

June, 15th: Workshop on the Implementation of the Trade and Sustainable Development title “Business models and practices for sustainable development” organised by the Central American Advisory Group.

June, 16th: 
- Joint meeting of the Advisory Group representatives from European and Central American civil society.

“Third Meeting of the Forum for Bi-Regional Civil Society Dialogue”.

June, 17th: Exchange meeting between the Civil Society Forum and the Association Agreement Sustainable Development Board.

Resources

Report on EU support to the justice and security sectors in Guatemala and Honduras

European and Central American civil society takes action around event on the trade pillar of the AA between the European Union and Central America

Between the 15th and 17th of June, in Tegucigalpa, Honduras, several oficial events will take place to analyse and discuss the progress of the EU-Central American Association Agreement.  During that week, Civil Society Organisations from Central America and European Union, among them ACT Alliance EU and CIFCA, will be participating in and facilitating the organisation of these events. 

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Everything you need to know about the EU-Central America Association Agreement

To find out more about the EU-Central America Association Agreement, we have prepared a brief document which includes the following issues: When was the agreement signed? What does it include? What is the ratification process? What official spaces are contemplated within the AA for the participation of civil society? Does the agreement contain a democracy clause? What does it contemplate in relation to trade and sustainable development?
 

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What is the behaviour of European investment in Central America?
 

ACT Alliance EU and CIFCA, together with organisations in Central America, have been analysing and warning about trends in policies and priorities of the European Union that promote increasing trade relations with Latin America and Central America. At the same time, there are more and more allegations of human rights violations being reported.

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The murder of Berta Cáceres: lessons to be learned

Ever Guillén, of We Effect (CIFCA's member organisation) write an analysis of the murder of Berta Cáceres and the implications on human rights defenders around the world. Furthermore, it highlights the importance to monitor the behaviour of big projects investments.

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Central American and European civil society takes action around events on the trade pillar of the AA between the European Union and Central America

In 2013, the trade pillar of the Association Agreement (AA) between the EU and Central America began to be implemented. This meant not only that trade barriers between the two regions began to be reformed and opened up to new markets, in addition several institutional mechanisms for monitoring the AAs were also activated. As a result, EU officials and officials from Central American ministries meet regularly to analyse and discuss the progress of the agreement. Civil society also has mechanisms to monitor the agreement. Organisations, trade unions and employers meet under the sustainable development chapter of the trade pillar. ACT Alliance EU and CIFCA take part in this mechanism, on behalf of European organisations.

The annual meeting of these (European and Central American) Advisory Groups will take place on 15, 16 and 17 June in Tegucigalpa, Honduras. During that week, we will be participating in and facilitating the organisation of several events to disseminate and promote the active participation of Central American civil society organisations on these issues. These events are:
 
  • 14 June: Forum of European and Central American Social Movements and Civil Society: Does the Free Trade Agreement between the European Union and Central America contribute to the progress of our peoples? This event has been organised by Via Campesina and the Central American FTA Observatory with the support of the networks. Its aim is to discuss and gain knowledge about the impacts of free trade agreements in Central America and take stock of the implementation of the Association Agreement (AA), by listening to the views of both European and Central American organisations.
  • Invitation
  •  
    June 15: Workshop on the Implementation of the Trade and Sustainable Development title “business models and practices for sustainable development” organised by the Central American Advisory Group.
    Agenda

  • June 16: Joint meeting of the Advisory Group representatives from European and Central American civil society. In this meeting advisory groups from both regions will discuss how to improve their communication and work towards the effective implementation of the sustainable development chapter and its obligations, as well as discussing the challenges of their monitoring work.
    Agenda

  • June 16: “Third Meeting of the Forum for Bi-Regional Civil Society Dialogue”. This event is an open space where representatives of civil society from the EU and CA can contribute to the debate and express their views in relation to the implementation of the Title on Trade and Sustainable Development in the European Union and in the Central American region.
    Agenda

  • June 17: Exchange meeting between the Civil Society Forum and the Association Agreement Sustainable Development Board. The Sustainable Development Board is the mechanism created by both parties to the agreement (Ministers, technicians from Ministries) to monitor the implementation of labour and environmental obligations included in the Sustainable Development chapter of the Association Agreement. Civil society therefore has the opportunity to dialogue with this body and voice their concerns and recommendations on the subject.
    Agenda
During these events we will reiterate the need for permanent and thorough monitoring of the impacts of AAs in Central America, in particular the obligations of States that are participating in the Agreement in light of the clause on democracy and human rights; and the active participation of civil society organisations in this monitoring.

 
  Tuesday 14 Wednesday 15 Thursday 16 Friday 17
Morning   Workshop on the implementation of the title on Trade and Sustainable Development. Meeting of Advisory Groups from CA & EU. Meeting between the Civil Society Forum and the Association Agreement Sustainable Development Board.
Afternoon Forum of European and Central American Social Movements and Civil Society Workshop on the implementation of the title on Trade and Sustainable Development. Meeting of the Civil Society Dialogue Forum.  

More information: http://www.eesc.europa.eu/?i=portal.en.international-trade-monitoring-eu-central-america
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Everything you need to know about the EU-Central America Association Agreement

The European Union - Central America Association Agreement (AA) was signed in 2012. It consists of three pillars: political dialogue, cooperation and trade. To date only the trade pillar is in force, pending EU ratification of the other two pillars. The Association Agreement will provide the future legal framework for EU-Central American relations once the three pillars are in force.

Civil society is involved in monitoring the AA through mechanisms for participation explicitly set out in the Association Agreement, such as the civil society advisory groups or the Meeting of the Civil Society Forum on Bi-Regional Dialogue (mentioned in the preceding article). Civil society also participates by carrying out its own analysis and awareness-raising activities and monitoring the impacts of the AA in the populations of the two regions.

Moreover, the Association Agreement includes in its provisions references to a number of agreements on labour and environmental issues, which civil society should take into account when monitoring the Agreement.

To find out more about the EU-Central America Association Agreement, we have prepared a brief document which includes the following issues:
When was the agreement signed? What does it include? What is the ratification process? What official spaces are contemplated within the AA for the participation of civil society? Does the agreement contain a democracy clause? What does it contemplate in relation to trade and sustainable development?

For the answer to these and other questions, please refer to our leaflet: Everything you need to know about the EU-Central America Association Agreement.
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What is the behaviour of European investment in Central America?


ACT Alliance EU and CIFCA, together with organisations in Central America, have been analysing and warning about trends in policies and priorities of the European Union that promote increasing trade relations with Latin America and Central America. This has been confirmed by the fact that the EU has signed agreements that promote and facilitate these exchanges between the two regions, such as the EU-Central America Association Agreement (AA), the Free Trade Agreement with Colombia-Peru, Economic Partnership Agreements (EPAs) with the Caribbean, etc; but also by greater space for dialogue with the private sector. At the same time, there are more and more allegations of human rights violations being reported, such as the failure of the Central American states to comply with their internationally-recognised obligations, and the persecution, defamation, criminalisation and the murder of social leaders who claim the enforcement of these standards.

In these situations many factors interplay, but one of the aspects most-often questioned is the role played by investment and companies: to what extent do they respect national and international law? How much do they know about or analyse national contexts and whether conflicts already exist or could be generated by their own investments? There is already progress on these issues in the investment framework supported by the World Bank (in Bajo Aguán, Honduras, for example). But what about European investment? What sectors is it concentrated in? What countries does it come from? What are the challenges we encounter when trying to access this information?

ACT Alliance EU and CIFCA have tried to answer some of these questions, in order to deepen this knowledge in the future. To do this, we have collected general information on the behaviour of foreign direct investment (FDI[1]) in the region. The Latin America and the Caribbean region receives the second largest amount of FDI in the world after Asia, with 159 billion dollars. This has doubled in the last decade; in 2004 FDI stood at 80 billion dollars[2].

In the case of Central America, the sector receiving the largest amount of FDI is the services sector, followed by manufacturing and finally natural resources. That said, it is important to highlight European investment in the energy sector, with heavy investment in clean energy. Currently most of these companies have bid to operate solar and hydroelectric plants. Some of the emblematic cases are:

As for the challenges to accessing information, we found that: a) Not all Central American countries publish disaggregated data showing the flow of FDI by sector and by country of origin; b) primary sources (data from national statistics institutes) should be contrasted with reliable secondary sources, such as ECLAC, IDB, etc .; c) it is difficult to analyse the dispersion of capital (subsidiaries, international versus national, etc.) and the different forms of investment. Other mappings have been conducted by civil society organisations, using a different approach. Some focus on socio-environmental conflicts, (such as OMAL[3]) or environmental (such as the Environmental Justice Atlas[4]).

With this background information, ACT Alliance EU and CIFCA have carried out initial research about which companies or groups of European companies are investing (foreign direct investment, FDI[5]) in four Central American countries (El Salvador, Guatemala, Honduras and Guatemala) and in which sectors, reflected in the database in the link at the end of this article. For the reasons mentioned above, we decided to focus on the energy sector (hydroelectric and green energy) and agriculture (palm oil, sugar cane, bananas, coffee). This is an initial identification study that we hope to investigate further in the future. Therefore, we appeal to our readers that if they have more data, research and analysis on these issues, to share them with us so that we can incorporate them into the database.

Further information can be found in the Briefing on investments.
 
[1] Foreign Direct Investment (FDI): Capital investments made by a natural or legal person (public institutions and companies, private companies, etc.) in a foreign country (OECD)
[2] Comparison between 2004 and 2014.
[4] Environmental Justice Atlas: https://ejatlas.org/
[5] Foreign Direct Investment (FDI): Capital investments made by a natural or legal person (public institutions and companies, private companies, etc.) in a foreign country (OECD)

 
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The murder of Berta Cáceres: lessons to be learned


Author: Ever Guillén, We Effect

The murder of Berta Caceres, coordinator of the Civic Council of Popular and Indigenous Organisations of Honduras (Consejo Cívico de Organizaciones Populares e Indígenas de Honduras - COPINH), which occurred on March 3; has not only caused concern and outrage among human rights defenders around the world, it has also led to expressions of protest from various governments and international organisations. These include European member states and the European Parliament; who, since the time of Berta’s murder, have continuously called for justice and for the Honduran government to assume its responsibility in the investigation of this serious transgression against those who defend human rights and freedoms. What happened to Berta Cáceres, confirms the danger and risk faced by human rights defenders in this Central American country, which has been identified by the British NGO Global Witness[1] in its most recent report (April 2015) as one of the most dangerous countries in the region for environmental and land activists, with more than 116 murders recorded in 2014 alone, linked to land conflicts in the country.
 
The implications of this crime have also opened up a debate about the responsibility of states as duty bound to prevent this kind of political violence, guaranteeing life and support for the work of those who defend the rights of individuals and peoples, which are affected by foreign investments exploiting natural resources in developing countries. In the case of Honduras, environmental, indigenous and human rights organisations have reported on the illegal and illegitimate concession of approximately 30% of the national territory to 840 hydroelectric, mining, forestry and agribusiness projects. In the territory of the Lenca people alone, COPINH has reported the existence of 34 illegal concessions; and affirms the outbreak of further conflicts that could continue to claim the lives of other defenders from their organisation and those who represent indigenous and afro-Honduran peoples in the country.
 
All nations have the responsibility of complying with the commitments and legal instruments that they themselves have ratified for the respect of human rights, especially those linked to prioritising life, culture and the right to the self-determination of indigenous peoples. These must be respected above and beyond any financial obligations incurred under trade agreements or investment concessions for the exploitation of natural resources. This primary right is clearly defined in the Universal Declaration of Human Rights and ILO Convention 169, which guarantees indigenous peoples and communities free, prior, and informed consultation before decisions can be made about any development projects involving the use of their territories and community assets. This responsibility not only refers to those states that are recipients of transnational investments, but also to countries and governments that promote capital investment in other territories.
 
For all the above reasons, a number of questions related to the implications of the Association Agreement (AA) signed between the six Central American countries and the European Union in June 2012 will be placed on the discussion table during the summit of the Central American Integration System (SICA), to be held in Tegucigalpa, Honduras. The EU-Central America Association Agreement is composed of a contractual, stable and long-term legal framework covering three pillars: trade, political dialogue and cooperation. However, to date, only the cooperation and trade pillars are in force, the latter focused on fostering regional integration, reducing barriers to trade between regions (free trade) and strengthening Central American competitiveness and the capacity to attract European investments. Meanwhile, the pillar on political dialogue which regulates bilateral, regional and global issues of common concern including governance, democracy and human rights, gender equality, conflict prevention, the fight against corruption, sustainable development and climate change, is still pending ratification by the parliaments of the different European Union member states.

The pillar on political dialogue and the regulations that this would impose on European investment in Central America, by ensuring that investment adheres to respect for human rights and legality, specifically in the case of renewable energy investment projects, could have meant the difference between life and death for human rights defender Berta Cáceres. The Agua Zarca hydroelectric project is currently funded by the Honduran company Desarrollos Energéticos S.A. (DESA), as well as with $15 million from the Netherlands Development Bank (FMO), $5 million from the Finn Fund Bank from Finland and $24.4 million from the Central American Bank for Economic Integration (CABEI). In line with provisions of the human rights clause in the Association Agreement’s pillar of political dialogue, funders should be taking the necessary steps to cease participation in this investment and prevent the revival of conflict in the area, considering that COPINH and Berta Caceres constantly reported the violation of Convention 169, as well as harassment and death threats from DESA. European investors should take seriously the issues that led to the withdrawal of the first financial entities from the hydroelectric project; the Chinese company Sinohydro terminated its contract with DESA citing the resistance of the indigenous community and later, the World Bank did the same, due to concerns about human rights violations related to the project.
 
Time and again in different community assemblies, the indigenous population in the area has rejected the privatisation of the Gualcarque River, which led to a conflict scenario, the judicial persecution of Berta Caceres and violent attacks by the Honduran Army and National Police, whom the State of Honduras entrusted with the protection of the hydroelectric plant. Conflicts with DESA and Sinohydro, in June 2013, claimed the lives of Tomás García, an indigenous leader, who was killed by gunshot fired by a member of the Honduran army during a peaceful COPINH protest in the community of Río Blanco, which caused the closure of the first phase of project financing.
 
Berta Caceres’ example of struggle, peaceful resistance and commitment to the defence of human rights, including the rights of the Lenca indigenous people against the Agua Zarca dam, led her to be awarded the Goldman Prize (the Environmental Nobel) in 2015, the highest recognition in the world that an environmental advocate can receive; this represented massive support for the struggle against the privatisation of the Gualcarque river. However, this international call to protect the river was not sufficient evidence for European investors to take the decision to cancel their participation in the project, which could have prevented the crime against Berta Caceres and against Nelson García, who was murdered a few days after the indigenous leader. Even now, these crimes have led to nothing more than the temporary suspension of the financial investment by the FMO, CABEI and Finn Fund. The arrest on May 2 of four alleged perpetrators of the crime; one of them a soldier active in the Honduran Armed Forces, two retired soldiers responsible for DESA private security, and one more, the environmental manager of the hydroelectric plant, reveals a pattern that directly involves not only the company but the State of Honduras. This should be sufficient reason to cancel European funding, but also for the EU and its institutions to call upon the Honduran State to review all its concessions, and to respect Convention 169.
 
This case should be used by the European Union and its institutions, to consider the need to review their trade relations, the regulations that must be ensured for their investments and the need for political dialogue with Central America, in order to avoid and prevent such situations from occurring in the future. Furthermore, it should be noted that as the EU is the main donor for citizen security and justice in Honduras, this case raises the need to revise this cooperation, which, to date, has not provided positive results, but has instead been used against human rights defenders. The European Union should move beyond resolutions and demands for justice, and begin to contribute to the prevention of crimes like this. The decision must be taken to enforce the extremely important political dialogue pillar, for Berta, Tomás and Nelson, who lost their lives defending the Gualcarque River and the right to indigenous autonomy.
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This newsletter has been produced with support from the European Union.
Its contents are the authors’ responsibility and do not reflect the views of the European Union.
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