2006 ECOSOC Preparatory Meeting, New York

Roundtable Three, 5 April 2006

Presentation by Leiria Teresa Vay Garcia,
President of the Association of Farmers' Development Committees (CODECA), Guatemala

Analysis of the challenge of poverty and the creation of dignified and stable work

The indigenous resistance in Latin America, and particularly in my country, has been an example not only of a struggle but also of a terrible drama concerning the atrocities that were committed against Mayan-descendent communities on the part of Spanish colonization. Today, we see in Guatemala the products of the system imposed by the crown, evidenced in the exploitation, exclusion, and racism and discrimination. These reflect a concentrating economic system and an oligarchy that represents a parallel power structure alongside the state, which represents an obstacle that blocks sustainable economic development brought about with equity and justice.

Guatemala is a multilingual and multicultural country, but this is not taken into consideration in the economic and commercial policies that the state adopts. The vast majority of these are directed to create and strengthen the privileges of the dominant economic sectors, at the detriment of the majority of the population. One graphic example of this is the national budget, in which investment is directed toward non-indigenous populations, that is, urban populations and those with the highest development index ratings in the country. This leaves rural communities on the margins, as year-after-year they report worse indicators for health, education and employment. Meanwhile, this investment is financed by external debt and fiscal revenue that is primarily focused on consumption. In other words, in Guatemala those who earn the most pay the least, while those who earn the least pay the highest taxes through what is a regressive tax system, demonstrating the paradox and injustice in the Guatemalan state.

The governments in the post-conflict era have applied policies of open markets that are clearly at odds with the Peace Accords that were assumed as the state's commitment, particularly relative to socio-economic aspects and the agrarian situation that is described in article 14:

The state corresponds to promote, orient and regulate the socio-economic development of the country in a manner that, along with the joint efforts of the society, can ensure the integration of economic efficiency, increased social services and social justice. In the quest for growth, economic policies should be oriented and impede that which is produced by processes of socio-economic exclusion, such as unemployment and impoverishment; and, on the other hand for the benefits of economic growth to be maximized for all Guatemalans.

However, some international trade agreements that have been negotiated, particularly CAFTA (which is about to take effect) and the Panamá Community Plan, PPP (which is now in effect), which can be considered ruinous for the local production and, above all, agriculture. Among other things, the country is opening its doors to the global marketplace and limits, where it does not eliminate, the role of the state as a regulator of social relations, giving them [markets] pre-eminence in the same national constitution. Today, the results of these policies have been bankrupting - and will continue to bankrupt - local industries and small- and medium-scale rural producers that are competing against large multinationals that receive incentives (subsidies) from governments and that create distortions in the markets to the detriment of our production.

Though it is certain that in Guatemala , as in the majority of countries in Latin America , there has been a certain level of economic growth, this is not reflected in dignified and stable work for the popular sectors. Moreover, the informal sector of the economy has seen an increase. This demonstrates the little interest for investment in the capacity of this small-holder sector, when compared to that which benefits from the agro-export model that prevails in these countries.

In a study undertaken in 2005 by the Association of Farmers' Development Committees ( Comité de Desarrollo Campesino - CODECA), on the employment situation in rural areas of Guatemala's southern coast, alarming data was noted on the conditions in which farmers in this zone are working. For example, only five percent possess a stable contract, meaning more than one year to work for the agricultural company with a monthly salary that is similarly stable, while 75 percent are contracted for specific jobs and must look for work on a daily or weekly basis to sustain their families. This means that in seasons in which there is no planting or maintenance of crops, farmers have no incomes upon which to sustain themselves. At the same time, this study demonstrated that 91 percent of agricultural workers receive a salary lower than that which is legally established in the labour law. This can be attributed to the government's lack of interest in supporting incentives for rural production, the result of which is that the vast majority of the rural population in Guatemala lives in poverty and extreme poverty.

According to our employment study, there is a lack of formal protections to agricultural workers: 71 percent of agricultural employees are contracted orally. This means that these companies do not register their staffs in any manner and workers cannot document their ties to a job or company. This also has repercussions in terms of affiliation with social security, where less than one half (47 percent) do not benefit from social security.

The jobs created as part of opening up trade under the neo-liberal system that has been adopted in various Latin American countries are those which are the products of investment coming from that capital. This is expressed most clearly in the textile plants, jobs that do not only offer miserable salaries, but also deplorable working conditions. At least in the case of Guatemala , the government cannot or will not apply sanctions based on the existing Labour Law.

For there to be equitable economic development, with sustainable growth, a profound reform to the tax system is needed, one reoriented to the injustice felt by those who earn less. This would permit the state to fulfill its social pact with dispossessed sectors. In the same vein, it is necessary for serious legal penalties to be applied to those who evade or elude their tax payments.

To promote employment, it is necessary for the state to facilitate requisite conditions, such as the redistribution of resources via the national budget, with the goal that communities which are excluded from development can access quality public services. On the other hand I can assure you, based on the vivid experience with my organization, that no country can develop or generate dignified and stable work for its citizens if the land is property in the hands of the privileged few. This is not just and cannot be acceptable. We must search for ways that this indispensable resource for real and equitable economic growth is distributed more efficiently among those who are working. A farmer without land is like a boat without water, and thus communities in the Americas should look to agrarian reform as the entry point for the path to prosperity and social development of our communities. Thank you very much!

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