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ALBA To Join Or Not to Join?

ALBA To Join Or Not to Join?. Norman Girvan Presentation at PNP Forum on “Progressive Internationalism” UWI Mona September 12, 2009 http://normangirvan.info. THE WORLD. HAS CHANGED. SHARE OF WORLD GDP. Source: World Bank WDR 2009: 106; author

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ALBA To Join Or Not to Join?

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  1. ALBA To Join Or Not to Join? Norman Girvan Presentation at PNP Forum on “Progressive Internationalism” UWI Mona September 12, 2009 http://normangirvan.info

  2. THE WORLD HAS CHANGED

  3. SHARE OF WORLD GDP Source: World Bank WDR 2009: 106; author ‘In 2020, 3 of the world’s 4 largest economies will be Asian, with China #1’ EIU’s 2006 Foresight Report http://graphics.eiu.com/files/ad_pdfs/eiuForesight2020_WP.pdf

  4. LATIN AMERICA HAS CHANGED • “In August 2007, the Associated Press calculated that Chavez had promised $8.8 billion in aid, financing, and energy funding to Latin America and the Caribbean between January and August 2007, a figure far higher than the $1.6 billion of U.S. assistance for the entire year”. COHA, Venezuela’s Oil Based Economy http://www.cfr.org/publication/12089/

  5. PETROCARIBE IS NOW THE LARGEST ‘AID DONOR’ IN THE CARIBBEAN • From June 2005 to the end of 2007 Petrocaribe concessionary loans averaged $468 million/year; U.S. Aid was running at approx. 340 million/year; and IDB disbursements about $100 million/year • Jamaica received $471 M in Petrocaribe loans from June 2005 to March 2008; US assistance FYs 2005-2007 amounted to $58 million.

  6. LATIN AMERICA HAS CHANGED! • Blockage of US-promoted FTAA Project • UNASUR—The Union of South American Nations. Guyana and Suriname. • IIRSA – Initiative for Infrastructure Integration of South • ALBA – Alternative to free trade (neoliberal) integration • The 1st Latin American and Caribbean Summit - December 2008 • The 5th Summit of the Americas - April 2009 • the OAS General Assembly - June 2009 ‘THE ERA OF US HEGEMONY IN LATIN AMERICA IS OVER’ – Council of American Affairs COHA

  7. UNASUR SUMMIT ENDS WITH CALL FOR PEACE IN SOUTH AMERICA August 29 2009 UNASUR stressed that "the presence of foreign military forces cannot, with its means and linked resources to goals, threaten the sovereignty and integrity of any South American nations and, in consequence, the peace and security of the region."

  8. Obama is missing a great opportunity to put US-LAC relations on a new footing • 5th Summit of the Americas “we seek a new beginning in our relations” • “I am opposed to the violent overthrow of democratically elected governments” • Suspicions of US complicity in Honduras coup • Perceived collusion of US State Department with illegal regime—failure to designate it a ‘coup’ • Colombia-US agreement for the use of bases conferring a continental reach for US forces; opposed by the vast majority of LAC nations • UNASUR Summit August 09; Declaration, Lula-Obama conversation

  9. NEW SOCIAL MOVEMENTS • Organizations of Indigenous, Afro-Latin American, Campesinos, women, Green, and other anti-neoliberal groups • World Social Forum – Annual since 2001 • Role in the election of Lula (Brazil, 2002); Morales (Bolivia, 2004); Correa (Ecuador, 200); and in shaping policies in other countries • National Resistance Front in Honduras

  10. Declaration of Indigenous People 2009 World Social Forum, Belem The crisis of Western capitalist civilization requires us to rebuild and reinvent new and different options of coexistence between nature and society, democracy, the state and patterns of consumption. It points to the adoption new ways of living and in this context, it is not just that ‘other worlds are possible’, they are urgent, indeed they are being and have been built from the time of the first victims of the most barbaric forms of capitalist violence in the / colonial / modern and contemporary era. We, the Indigenous Peoples and Communities, Originarios, Campesinos, Ribereños, Quilombolas, Afrodescendientes, Garífunas, Caboclos, Dalits, and others, and their children who migrated to the ghettoes of the cities, and all the other excluded, invisible and ‘ untouchables’ of the planet who continue to resist, to strengthen and to update alternative forms of social, technological, ethical, political, economic, , cultural and spiritual organization of the human existence. http://alainet.org/active/28734

  11. National Gathering of Afro-Honduran Youth Calls for a November 2010 Plebiscite so the Honduran People Can Vote on a New Constitution Seventy-five young community organizers met on August 27, 28 and 29 in La Ceiba, Honduras, and authored this declaration calling for a November 2010 referendum for a new Constitution. D.R. 2009, Samuel Molina..

  12. ALBA – The Bolivarian Alliance for the People of Our America • Launched 2004 by Venezuela and Cuba • Members now include Bolivia, Nicaragua, Dominica, Honduras, Ecuador, Antigua and Barbuda and St Vincent and the Grenadines – 73 m. population, $669 billion GDP • Alternative to neoliberal integration based on reciprocal free trade, freedom of investment, and ‘market friendly’ policies • Series of Inter-governmental agreements

  13. ALBA GUIDING PRINCIPLES • People-oriented – social on par with economic • Solidarity • Complementarity • Compensatory financing for the treatment of asymmetries • Differential treatment of countries according to their circumstances

  14. ALBA PRINCIPLES AND RULES • Trade and investment to be instruments of fair and sustainable development with effective participation of the State. • Special and differentiated treatment for participating countries according to their level of development and size • Economic complementarity and cooperation between countries to preserve efficient and productive specialization and balanced economic development • Cooperation and solidarity for a Continental fight against illiteracy provide free healthcare and a scholarship programme. • Creation of a Social Emergency Fund • Integrated development of communications and transport • Protection of the environment • Energy integration • Promotion of intra-Latin American Investment through a Latin American Investment Bank, a Bank of Development of the South and a Latin American Society of Reciprocal Guarantees • Defense of cultural identity: creation of TELESUR. • Intellectual Property Rights to protect the patrimony of the region while not becoming an obstacle to cooperation • Harmonization of positions in multilateral fora, including democratization of international organizations particularly the United Nations system.

  15. CARIBBEAN ALBA • The fight against poverty and social exclusion • Joint Plan for food security • Power and mining development for the development of joint production chains • Portfolio of integrated investments • Academic and cultural exchange • Tourism—cooperation in human resource development, air transport, and other areas • Environmental conservation • Caribbean regional market—intra-regional trade • Prevention and management of natural disasters

  16. PRACTICE • Concessional financing for energy import bills • Use for state-owned industries, physical and social infrastructure, • Support for projects in health and education that directly benefit the poor • Non-reciprocal trading arrangements.

  17. ALBA TRADE AGREEMENTS • Non-reciprocity - Cuba agreed to grant duty-free access to Venezuelan imports and to remove non-tariff barriers; while in return Venezuela has agreed to eliminate only non-tariff barriers on Cuban imports • Compensated trade - through direct product exchanges – Dominica is allowed to pay for 40 percent of its Petrocaribe oil imports with exports of bananas • Trade agreements negotiated on a case-by-case basis, allowing for flexibility of commitmentaccording to country circumstances. • Reciprocal Credit Arrangements Venezuela-Cuba Agreement.

  18. ALBA FINANCIAL COOPERATION IS POWERED BY VENEZUELA • $100 million to Bolivia on joining ALBA - additional $30 million for infrastructure • ALBA Caribe Fundlinked to Petrocaribe •  ALBA Bank - authorized capital of $2 billion subscribed capital of $1 billion.

  19. ALBA SOCIAL COOPERATION IS POWERED BY CUBA • 30,000 Cuban doctors providing free medical services to the poor in LAC • 70,000 students are receiving training as health professionals • Over 2 million made literate in literacy programmes • 600,000 people have ‘had their sight restored via Operation Miracle’ • 2000 Cuban scholarships per year for Venezuela, 5000 Cuban medical scholarships for Bolivia. • Dominica - over 100 students attending Cuban medical and nursing schools; approximately 75 Dominican students are in other Cuban schools. 2,000 Venezuelan and Cuban scholarships are available to qualified Dominican students in computer science, medicine, engineering, sports, physics, math, and agriculture’.

  20. Some Recent Developments • June 09: Change in Petrocaribe terms: 50% paid in cash; 50% to accrue to “Integrated Petrocaribe Fund” managed by ALBA Bank for approved projects; http://www.pdvsa.com/index.php?tpl=interface.sp/design/biblioteca/readdoc.tpl.html&newsid_obj_id=7756&newsid_temas=111 • http://www.pdvsa.com/index.php?tpl=interface.sp/design/biblioteca/readdoc.tpl.html&newsid_obj_id=6283&newsid_temas=111 • ALBA Bank approved $50 M loan to St Kitts & Nevis June 09; $10 M immediate disbursement – June 09 PDVSA 12/06/09 • Dominica: Opening of fuel distribution and supply plant constructed with Petrocaribe funds – June 09 • Dominica: ‘Housing Revolution’ programme financed by Petrocaribe: 50 “Petrohouses” ready for assembly; 3000 built, 5% for public sector employees--teachers and police—41 to go to Carib reservation and primary school

  21. ALBA Bank to provide financial advice to Petrocaribe • ALBA Caribbean Fund ‘has financed 84 projects in 11 countries with investment of $222 million’ ABN 11/06/09 • Food ALBA - $7 M approved for non-reimbursable financing for projects in 8 countries including Jamaica • Petrocaribe: 8 refinery projects have been built with PC money, adding 580000 b/d • ALBA Maritime Transport: Fleet of 2 ships for transport of crude to Caribbean destinations

  22. ALBA Social Movements Network • Constructing integration from below from the people • Boosting ALBA and people solidarity • Opposing the imperialist project • Mobilising against the coup in Honduras

  23. POTENTIAL NEGATIVES OF ALBA • Donor dependency • Energy dependency • Economic vulnerability • Political vulnerability • State-centric, as opposed to ‘grassroots’ or community-based development • Capital intensive, potentially environmentally damaging projects • Transparency/accountability issues • Potential for corruption • Democratic, participatory governance should be integral to ALBA

  24. ALBA: TO JOIN OR NOT TO JOIN? • Caricom-ALBA agreement is the ideal arrangement, but some Caricom countries are opposed • Although Petrocaribe is not tied to ALBA membership, the ALBA Bank will now handle Petrocaribe credits. • Membership would give a say in the ALBA Bank and access to ALBA inter-governmental cooperation projects, e.g. Food, Shipping, trade bartering, common current -‘sucre’ • ALBA membership would expand room to maneuver in development policies by providing support to state enterprises and cooperatives

  25. THE CONS • Possible undermining of Caricom/CSME • ALBA Trade agreements are not incompatible with CSME; but ALBA membership could create a distraction to CSME completion • ALBA Foreign Policy activism could ‘cut across’ Caricom foreign policy coordination • But Caricom governments should stop dilly-dallying and shilly-shallying about the reform of Caricom governance if they want the Community to be taken seriously • Fear that ALBA membership will strain traditional relation with US

  26. Links • ALBA, Petrocaribe and Caricom, Norman Girvan • MovimientosSociales con el ALBA • ALBA website • Petrocaribe website

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