The decision of the World Bank tribunal handed down on June 2nd could be seen as a victory. The country of El Salvador successfully fought off an absurd legal claim brought by Pacific Rim Mining, a Canadian-based company under the Central American Free Trade Agreement (CAFTA), of which Canada is not a party to.
However Pacific Rim’s claim under other investor rights provisions is going forward and still at stake is El Salvador’s sovereign ability to interpret its own laws, instead of having law violations decided upon by the International Centre for Settlement of Investment Disputes (ICSID). ICSID enables the World Bank’s interpretations of sovereign law to have more legitimacy than a country’s own courts.
And the cost of defending itself and its people continues to mount for El Salvador. Trade deals based on this model perpetuate a broken system that literally takes resources from developing countries and gives them to corporations and the World Bank’s self created legal process.
The real ‘investor rights’ we should be talking about here is the sovereignty of El Salvador to use its resources to provide basic needs for its people.
For the $5 million El Salvador has spent in legal fees here is what they could have invested in instead*:
–Literacy classes for 140,000 young adults and senior citizens for an entire year (in 2010 the government spent $2 million on literacy classes for 56,000 people)
– Almost 1 year of scholarships for students attending high school and college in the entire country (in 2011 the government spent $6 million on scholarships)
–A year of infrastructure and school materials for 384,615 students (in 2012 the government will give either $13 or $25 per student to each school for materials and infrastructure. The difference in price depends on the type of school the student attends).
– 1/3 of the government’s support for healthy meals for schoolchildren (the 2012 government has $15.5 dedicated for the school lunch and snack program)
-Enough to give every student in the country a glass of milk each day to help nutrition and development ($5 million budgeted for 2012)
–1/5 of the entire government vaccination program for 2012
–1/4 of the $20 million shortfall the government is facing to fulfill all their program needs
–Food for 60,570 families in temporary shelters for 2 weeks during natural disasters, which have become more frequent as climate change worsens and weather becomes more destructive in populated areas.
For more information see:
-CAFTA Ruling Continues Corporate Attach on Environmental Protection see: Global Trade Watch/Public Citizen
–World Bank Tribunal Ruling in El Salvador Mining Case Undermines Democracy (IPS)
Kristen Beifus, Washington Fair Trade Coalition
Chaim Eliyah & Janae Choquette, Seattle CISPES
*Statistics compiled by Jan Morrill of National Roundtable Against Metallic Mining/International Allies Against Metallic Mining in El Salvador