United States Trade Representative Letter to Minister of Foreign Affairs

October, 03 2000 Share


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October 3, 2000

The Honorable Eduardo Montealegre 
Minister of Foreign Affairs 
Republic of Nicaragua 

Dear Mr. Minister:

President Clinton has signed a Proclamation designating Nicaragua as a Beneficiary Country under the Caribbean Basin Trade Partnership Act (CBTPA).

As you know, our review of Nicaragua's eligibility for these enhanced trade preferences involved an extensive dialogue with officials of your government regarding worker rights issues. We appreciate your government's engagement with us on these important issues.

Our recommendation that the President designate Nicaragua as eligible to receive the enhanced CBI benefits was based in large part on the assurances your government provided with respect to the specific issues raised during the eligibility review. I have taken note of your government's assurances regarding the need to ensure that workers in the Las Mercedes Free Trade Zone, and particularly at the Mil Colores and Chentex facilities, are able to enjoy their full rights under Nicaragua's labor laws. We also welcomed assurances that the Nicaraguan Government will work to advance the implementation of ILO recommendations regarding revisions to the labor code, particularly to correct current limitations on the involvement of confederations and federations in industrial disputes. We also acknowledge the Government of Nicaragua's agreement to participate in a regional program, to be funded by the United States, to enhance the capacity of your labor inspectorate.

While these responses to our concerns enabled us to recommend Nicaragua's designation as a CBTPA Beneficiary, I wish to make clear that we continue to have significant concerns with respect to the issues pursued during the eligibility review. In recommending that Nicaragua be designated as a CBTPA beneficiary, I have determined that the United States will maintain ongoing monitoring of worker rights concerns in Nicaragua, with a particular focus on matters raised in the contract of the CBTPA eligibility review.

It is important that we see indications of progress with respect to the assurances provided by your government during the review, particularly with regard to effective implementation of the labor code at the Mil Colores and Chentex factories and elsewhere in the Las Mercedes Zone. We do take note of the recent progress towards a resolution of the issues at Mil Colores and we hope that the same progress can be achieved at Chentex. I must stress that your government's efforts to assure the application of labor laws that protect worker rights in the zone will be a central element of our ongoing monitoring. Failure to achieve an improvement in this situation could place part or all of Nicaragua's CBTPA trade preferences in jeopardy.

I ask your cooperation in convening bilateral consultations to discuss worker rights issues before June 30, 2001. In addition, I would encourage your government to consider favorably the United States' offer to support additional technical assistance to evaluate developments on worker rights in Nicaragua, including in the maquila sector.

We will be approaching your government soon to discuss these proposals in detail. My deputy, Ambassador Richard Fisher, plans to travel to Central America before the end of the year. I anticipate that his visit will provide a useful opportunity to review these issues, and to evaluate implementation of the new trade preferences.

Thank you for your cooperation on these important matters.


Charlene Barshefsky 
Cc: Ambassador Francisco Aguirre-Sacasa 
Minister of Labor Manuel Martinez 
Minister of Trade Norman Caldera