Tri-country plan aims to attract private investment in Central America

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Jason Marczak of the Atlantic Council hosts a discussion about the tri-country plan with El Salvador's Foreign Minister Hugo Martinez and Guatemala's Foreign Minister Carlos Morales. (Photo: Larry Luxner/The Tico Times)

A joint plan presented in Washington DC last month by the governments of El Salvador, Guatemala and Honduras aims to address rooted problems of violence and poverty in the region, but threatens to bolster the same transnational corporate investment that has contributed to these problems.

The Plan for the Alliance for Prosperity of the Central American Northern Triangle was drafted by the three Central American governments at the request of US president Barack Obama. When the large numbers of Central American child migrants detained at the US border caused an international humanitarian crisis over the summer, Obama invited the presidents of El Salvador, Guatemala and Honduras – the countries of origin of the vast majority of detained children – to Washington. After announcing that most of the children would be deported, Obama suggested the presidents create a joint proposal to address the violence and poverty that drives children to migrate.

With the facilitation of the Inter-American Development Bank (IDB), the three Central American nations drafted a plan that outlines strategic actions to “stimulate the productive sector to create economic opportunities, develop opportunities for our people, improve public safety and enhance access to the legal system, and strengthen institutions to increase people’s trust in the State."

The plan includes proposals to improve educational opportunities and public security that could be promising if they are implemented in a manner that prioritized the needs of the people and emphasized social inclusion. However, the Guatemalan and Honduran governments’ commitment to addressing the structural causes of insecurity is questionable at best, given their frequent implication in State-sponsored violence.

The plan’s core focus is improving the foreign investment climate in order to generate jobs and reduce inequality, but history has shown that the jobs generated by foreign corporations are often unstable and low-paying. Notably, the plan makes no mention of how governments will ensure that companies fulfill labor and environmental standards.

The countries propose hefty infrastructure investments, including road, port, airport and railway projects designed to benefit industry and facilitate trade. Recently, in all three countries, such mega-projects have sparked popular protest and local conflicts within the communities that often face displacement. Furthermore, the troubling inclusion of a proposal for “special economic zones” conjures up Honduras’ Zones for Employment and Economic Development (ZEDES, or Charter Cities), territories where laws and the judicial system are suspended and investors act as de facto governments.

The November presentation of the plan in the US capital was primarily aimed at seeking financing from the United States and multilateral institutions. To date no funding measures have been announced, however, and the plan’s total price tag remains unclear.

Upon analyzing the full tri-country proposal, Dan Beeton at the Center for Economic Policy Research warned that “the plan brings to mind various past cases of crises exploited for economic gain, as Naomi Klein detailed in her landmark book, The Shock Doctrine.”

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