Chapter 7: Free Trade Treaties and the Failure to Industrialise

Over the last five hundred years Central American economies have become increasingly tied to the global economy. As we all know, this process is now referred to as globalisation, but the process has been advancing since the first western pirates (or heroes – depending on your historical outlook) landed on Central America’s shores. [Strange, perhaps, that I should refer to them as ‘western’ when they all came from the east.] This process of interconnection that we know as globalisation has been taking place for hundreds of years as part of an ongoing transition in the development of global capitalism. The qualitative difference today is the pace at which the process of globalisation has been happening over the last two decades, with a current, extraordinarily intensified phase of global transformation and change.

Keywords: globalisation | primary production | industrialisation | dependency theory | import substitution | industrialisation (ISI) | export-led development | free trade | foreign direct investment (FDI) | comparative advantage | level playing field | Washington Consensus | deregulation | debt crisis | tariff elimination | loss of sovereignty | transnational corporations (TNCs) | corporate social | responsibility (CSR) | export processing zones (EPZs) | maquila

Cartoon reproduced here by kind permission of Semanario Universidad (San José, Costa Rica) and by the cartoonist Luis Demetrio ‘Mecho’ Calvo Solís.