The Central American Free Trade Agreement (CAFTA) was signed in 2006 and aimed to promote economic growth and trade among the United States and countries in Central America. However, the agreement had some notable exclusions that are important to understand.
One of the primary goals of CAFTA was to eliminate tariffs and other trade barriers between participating countries. This included the United States, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic.
However, there were some key sectors and industries that were exempt from the agreement. These included:
1. Sugar: The United States protected its domestic sugar industry by excluding sugar from the trade liberalization provisions of CAFTA. This meant that sugar imported from CAFTA countries would still be subject to tariffs.
2. Textiles: While most industrial goods were included in the agreement, textiles and apparel were subject to transitional provisions and were not fully liberalized until January 1, 2008.
3. Rice: The United States also excluded rice from the trade liberalization provisions of CAFTA. This was done to protect domestic rice producers from increased competition.
4. Some dairy products: Certain dairy products, including cheese and milk powder, were also excluded from the trade liberalization provisions of CAFTA.
In addition to these specific exclusions, there were also concerns about the potential impact of CAFTA on labor rights, environmental regulations, and intellectual property. Critics argued that the agreement could lead to exploitation of workers, damage to the environment, and the loss of cultural heritage.
Despite these concerns, CAFTA was ultimately ratified by all participating countries and went into effect on January 1, 2006. While it had some notable exclusions, the agreement was still seen as an important step towards greater economic integration and trade in the region.