NAFTA MONITOR 1-4-94

[Kai Mander <kmander@xxxxxxxxxxx>]

NAFTA MONITOR
VOLUME I, NUMBER 2
Tuesday, January 4, 1994

Headlines:
NAFTA GOES INTO EFFECT
REBELLION IN SOUTHERN MEXICO LINKED TO NAFTA
GE WILL REHIRE 6 OF 11 FIRED MEXICAN UNION ACTIVISTS
UAW WILL BE "WAITING" FOR 15,000 JOBS PROMISED UNDER NAFTA
CANADIAN RETAILERS FAVOR BORDER TAX HIKE
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NAFTA GOES INTO EFFECT

The North American Free Trade Agreement went into effect January
1, immediately eliminating tariffs on about half of U.S. exports to
Mexico and 75 percent of U.S. imports from Mexico.  Many barriers
between Canada and Mexico were also lifted.  Most Canada-U.S. trade
is already duty-free under the Canada-U.S. Free Trade Agreement.
Among the U.S. exports to be stripped of tariffs immediately are
computers, airplanes, X-ray equipment, telephones and many
agricultural goods.  Among the items Mexico can now ship duty-free
to the United States are an assortment of car parts, electronic goods,
furniture, televisions, radios, toys and tequila.  By the year 2004, less
than 1 percent of the trade between the countries will be subject to
tariffs.

In a Friday editorial, Mexico's government-owned EL NACIONAL
newspaper said NAFTA represents the beginning of "an era whose
perspectives are not only very promising but also somewhat
unpredictable, above all in its first months and years. With the
elimination of tariffs, nobody knows with precision how the flows of
business and investment will behave," it said.

Canadian Trade Minister Roy MacLaren will visit Mexico and Chile
this week to discuss NAFTA and the possibility of Chile joining the
trade pact.  "I look forward to discussing Chile's possible accession to
the NAFTA during my stay in Santiago," MacLaren said in a
statement.  "Both of our countries can enhance their economic growth
and competitiveness by further liberalizing trade."

Sources: Joseph B. Frazier, "Mexico-NAFTA," AP, December 28, 1993;
Jeff Franks, "Long-Established Trade Barriers to Tumble," REUTER,
December 31, 1993; "Canada to Discuss Chilean Membership of
NAFTA," REUTER, December 31, 1993.
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REBELLION IN SOUTHERN MEXICO LINKED TO NAFTA

Hundreds of Indian guerrillas battled police in the southern Mexican
state of Chiapas to protest implementation of NAFTA and the widely
reported abuses of Indian peasants by powerful, wealthy landowners
in the region.  At least 56 people, including 22 police and 24 rebels,
were reported killed during two days of fighting.

The rebels reportedly took control of four cities and perhaps six
villages.  A leader of the Zapatista Army of National Liberation said
the revolt was timed to coincide with the implementation of NAFTA
and that it was launched to protest the growing economic inequalities
in Mexico.  The group declared war on the Mexican government and
denounced the Salinas administration as "illegitimate."  A rebel
commander declared: "We will control the entire country, including
the capital."  Mexico had not experienced an armed uprising since the
1970s.

Source: Tod Robberson, "55 Killed in Fighting in Southern Mexico,"
WASHINGTON POST, January 3, 1993; Tim Golden, Mexican Troops
Battling Rebels; Toll at Least 56," NEW YORK TIMES, January 3, 1994.
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GE WILL REHIRE 6 OF 11 FIRED MEXICAN UNION ACTIVISTS

General Electric Co. announced it will reinstate six of the 11 Mexican labor
organizers it fired last month.  The United Electrical, Radio and Machine
Workers of America (UE) and the Teamsters union had strongly protested
the firings, which came just days after Congressional approval of NAFTA
and only weeks after the workers had met with UE members in Juarez.
The workers were involved in an organizing campaign for the Authentic
Labor Front, Mexico's only independent labor group.  In announcing the
rehirings, GE reportedly told U.S. labor officials the six workers had
mistakenly been fired for insubordination.

Union leaders have also accused Honeywell Inc. of firing 20 workers trying
to organize a factory in Chihuahua.  The company, which says the firings
are unrelated to union activity, has not responded to the protests.  U.S.
labor leaders welcomed the GE rehirings, but called on GE and Honeywell to
reinstate all fired workers.  UE General Secretary-Treasurer Amy Newell
said the firings violated the labor rights language of NAFTA.  "President
Clinton and Congress assured the American people that labor and human
rights would be respected on both sides of the border," she said.  "These
gross violations of Mexican workers' rights deserve the attention of both
President Clinton and Congress. We demand an investigation."

Sources: Tim Shorrock, "6 Fired Union Activists Rehired by GE in Mexico,"
JOURNAL OF COMMERCE, December 27, 1993; Anthony Spinelli, "GE Plans to
Recall Workers," CONNECTICUT POST, December 25, 1993; "U.S. Union
Protests Help Win Reinstatement of Mexican Workers Fired by General
Electric," UE LABOR NEWS.
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UAW WILL BE "WAITING" FOR 15,000 JOBS PROMISED UNDER NAFTA

Prior to NAFTA's passage, President Clinton and auto manufacturers
claimed the trade pact would enable the Big Three automakers to
export 60,000 cars to Mexico and create 15,000 new auto-related
jobs.  Despite those assurances, the United Auto Workers (UAW)
union remained steadfastly opposed to NAFTA.  But now that NAFTA
has passed the UAW will be checking the accuracy of those claims.
"We're going to be waiting and looking with bated breath for those
15,000 good-paying jobs," said UAW President Owen F. Bieber. "By
God, I'll tell you this, we're going to keep tabs of how many (cars) are
sold there, and we're going to remind people of this."

Already, top executives of the Big Three have cast doubt on the
likelihood of those forecasts coming true.  "The 60,000 number -- I
have to tell you, I have not ever discussed that number, nor do I
know the origin of it," said Robert J. Eaton, chair of Chrysler Corp.
Bieber points out that the American Automobile Manufacturers
Association, the Big Three's trade association, often cited the figure.

Source: James Bennet, "U.A.W. Wants Trade Payoff in Jobs," NEW
YORK TIMES, January 1, 1994.
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CANADIAN RETAILERS FAVOR BORDER TAX HIKE

Many Canadian retailers are urging their provincial governments to
impose taxes on goods purchased in the U.S. by Canadian citizens
making cross-border shopping trips.  "International trade
agreements are fundamental to our basic principles," said Bill Draper,
president of the Winnipeg Chamber of Commerce.  Draper urged the
Manitoba government to impose a sales tax on cross border shoppers
"because it was hurting some of our merchants."  Manitoba imposed a
7 percent provincial sales tax on merchandise purchased in the
United States beginning last July.  New Brunswick and Quebec
imposed sales taxes of 11 and 8 percent on items bought in New
England states.

Source: Pat Doyle, "In Canada's Provinces, It's Unfree Trade Pact,"
MINNEAPOLIS STAR & TRIBUNE, December 20, 1993.
________________________________________________________
Resource:

"Worker Rights News," is a quarterly publication covering international
labor rights.  Included in the fall 1993 issue are several articles describing
current labor organizing events in Mexico.  International Labor Rights
Education and Research Fund, 100 Maryland Avenue, NE, Box 74,
Washington, D.C. 20002.  Tel: (202) 544-7198 Fax: (202) 543-5999
Email: laborrights@xxxxxxxxxxxx   Subscription: $15/individual,
$25/organization.
________________________________________________________
Editor: Kai Mander
The Institute for Agriculture and Trade Policy (IATP)
1313 Fifth Street SE, Suite #303, Minneapolis, MN 55414-1546 USA
Telephone:(612)379-5980 Fax:(612)379-5982
E-Mail:kmander@xxxxxxxxxxx
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