Chile: lots of Free Trade Agreements and growth but at what cost?

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Chile has signed Free Trade Agreements (FTAs) with 47 governments to date, including the US, Canada, the European Union, China, Central America and Mexico. While there are some examples of good practice, overall it is true to say that instead of supporting long-term development, the trade created by FTAs in Chile is reinforcing insecurity for millions of women workers.

Chile has signed Free Trade Agreements with 47 governments to date, including the US, Canada, the European Union, China, Central America and Mexico. It also has bilateral economic complementation agreements with a number of its South American neighbors and is negotiating deals with India, Malaysia, Thailand, and Japan.

Chile is proud of its status as one of the most open countries in the world, and of the economic growth this openness has helped to drive  (average of 5.5% over last 15 years). However, behind the success story, there are some heavy costs. While the growth has created jobs, generally speaking, the quality of these jobs is not high. In the agro-exportation sector (fruit, wine, salmon) where much of the growth is concentrated, the vast majority of workers, mainly women, are hired on temporary contracts. They work long hours and for low pay and in unhealthy conditions. Most have no sick leave, maternity leave or holidays, and few are enrolled in health schemes. Fewer still have savings for the future. Following liberalization, production has become concentrated in the hands of a few, mainly transnational, companies, with links up and down the supply chain. Under FTAs, these corporate entities enjoy global protection for their rights, while their workers are increasingly disempowered. The demand for more flexible labor, faster production and cheaper prices, has eroded the rights of workers, especially women. The dominant fruit-export companies in Chile are Dole, Chiquita, United Trading Company (linked to Del Monte) y Unifrutti. While there are some examples of good practice (Del Monte has been single out) overall it is true to say that instead of supporting long-term development, the trade created by FTAs in Chile is reinforcing insecurity for millions of women workers.The facts:

  • Only 50% of seasonal workers have contracts and therefore access to the welfare system
  • Sixty-eight percent of seasonal workers do not contribute towards a pension fund
  • A female seasonal worker employed for an average of two months a year would have to work for 120 years to be able to meet the contributions required to receive the minimum guaranteed pension ($143 dollars per month)
  • In the fruit-picking sector, 75% of women work more than 60 hours a week in season, on temporary contracts, but a third of them do not earn even the minimum wage.

OxfamRosa Palleres is the director of a group of temporary women agricultural workers in Andacollo: “Imagine it: a container of grapes sells for $200m, but where is the dollar for the worker here? We are paid miserably. There is a minimum wage but they don't pay it for agricultural workers. We say to ourselves: ”˜when will we be sufficiently aware and united to stop working, stop harvesting the grapes, just stop? What would happen to the businessman if we if we stopped all day? When are we going to have the self-awareness to do what the hospital workers and teachers do?'"It would be bad for them, because do you really think that if people in Europe knew what happened to the workers here that they would want our products? Supposedly the free trade agreements demand that the workers are ok, that they have rights. But we find that the Free Trade Agreements in Chile have not strengthened our rights at all. We are still getting poorer. The businessmen are richer, and the workers are poorer, in every sense of the word: economically, spiritually, morally; we are degraded in every way."An agricultural laborer doesn't take holidays, because she would be fired immediately, and would have to go elsewhere, and would have no way of buying food to eat. The situation is very difficult. One sees lots of injustice, all over the country. They speak of the marvels of a sustainable economy, but the workers are not able to sustain themselves."I feel like I have lost out, because I have given much of my life to these fields and now I see young people coming, who leave school early, who don't have any possibility of further study ”“ where will they get the money? ”“ so they come here to work in the fields. "The government policies point this way. They speak of economic marvels, of all the agreements there are with other countries but what are the consequences underneath? The President's proposals for the rural sector are a process in which we are not involved at all. Temporary workers are not represented at all. We are all losing out, we don't have transparency from the government. If things don't change, all that remains for us workers is to be exploited while others skim off the cream."