THE RETURN OF PLAN PUEBLA-PANAMA

The New Struggle for the Isthmus

by Bill Weinberg, WW4 REPORT

Mexico, Colombia and seven Central American nations held a 24-hour summit April 10 in Campeche, on the Yucatan's Caribbean coast. They issued a nine-point plan for revitalizing the regional development alliance known as the Puebla-Panama Plan (PPP). Joining Mexico's President Felipe Calderón were the presidents of Guatemala, Honduras, El Salvador, Costa Rica, Panama and Colombia, and the prime minister of Belize. Nicaraguan President Daniel Ortega was—significantly—represented by his vice-president, Jaime Moreno.

Calderón waxed eloquent. "Latin American integration is not a dream," he told the gathering. "As our Octavio Paz saw, it's a reality that we're constructing day by day." The major achievement of the summit was an agreement to pursue a region-wide oil refinery, to be located in an as-yet undetermined Central American country. Officials said four companies have expressed interest in bidding on the project.

The project was slated to process 230,000 barrels of oil a day when it was first proposed by Calderón's predecessor Vicente Fox in 2001, but it is now scaled down to 80,000 barrels per day. Most of the oil to be refined at the planned facility will come from Mexico's giant parastatal Pemex.

The nine PPP states also pledged to step up security and military cooperation. "We're facing international organized crime that requires us to organize against an enemy that knows no borders," Calderón said.

Ten days later, Nicaragua announced construction of an oil refinery on its national territory, with aid from Venezuela as part of Hugo Chávez's proposed Bolivarian Alternative for the Americas (ALBA). Work is to begin on the "Sandino-Bolivar" refinery by June, when Chávez is slated to visit Nicaragua. It is of course, named for Augusto C. Sandino and Simón Bolívar-the respective historical heroes of Nicaraguan and Venezuelan left-nationalism.

Francisco López, director of state oil company Petronic, said that besides meeting Nicaragua's annual demand of 10 million barrels, the refinery will supply the other countries of the isthmus from Guatemala to Panama. López compared the project to the Panama Canal in its magnitude. The oil is, of course, to be supplied by the Venezuelan parastatal PDVSA. The facility is slated for Nagarote, in León department on the Pacific coast, some 20 miles out side the capital Managua.

Two development initiatives are in a race to industrialize the Central American isthmus—the PPP, led by Washington-allied neoliberal Calderón, and ALBA, led by "21st century socialism" advocate Chávez. The other ALBA nations are Cuba and the Bolivia of Evo Morales. Now, thanks to Daniel Ortega, ALBA may be ahead in the race for the isthmus.

CAFTA and Oil

First proposed by the Inter-American Development Bank in 2001 to build the infrastructure for expanded trade, the PPP envisioned grid integration, industrial zones and new trans-isthmus highway and rail links. Recognizing that the process had become moribund, Calderón made revival of the PPP a part of his presidential campaign last year. In October, president-elect Calderón flew to Costa Rica to meet with fellow free-trade advocate President Oscar Arias. The two publicly pledged to revitalize the Plan, and also announced that they would invite in Colombia-Washington's closest South American ally.

Costa Rica is the only signatory to the pending Central American Free Trade Agreement (CAFTA) not to yet win approval for the pact from its legislature. But last November's election of Daniel Ortega of the left-nationalist Sandinista National Liberation Front (FSLN), changes the political balance.

Despite repudiating the Marxism he professed when the FSLN was in power in the 1980s, Ortega has wasted little time in making clear his radical populist stance.

In a clear tilt to Venezuela, Ortega anounced April 19 that Nicaragua will request the extradition of Luis Posada Carriles, the Cuban militant just freed by US immigration authorities. Posada Carriles is wanted in Venezuela and Cuba for terrorist activities, and the US has refused to extradite. Said Ortega: "We are giving instructions for Nicaragua, besides condemning his release, to offer its territory so that Posada Carriles can be tried in our country, taking into account that he also committed terrorist acts here." Posada Carriles was an operative in the "Contragate" network that supported right-wing guerillas in Nicaragua in the 1980s—the last time Ortega was president.

On April 23, when Iran's Foreign Minister Manouchehr Mottaki stopped in Managua on a tour of Latin America, Ortega took the opportunity to express his support for Tehran's nuclear program.

Days later, preparing for a meeting with International Monetary Fund officials, Ortega said the line of credit Nicaragua is now seeking will be its last. "Within five years Nicaragua will be free from the fund," he pledged. "It is a blessing to be free of the fund, and for the fund it will be a relief to rid itself of a government that defends the interests of the poor."

Even the conservative governments of the isthmus made recent moves to extend greater public control over resources—to the displeasure of Washington. In January, President Manuel Zelaya of Honduras, insisting it was "not a nationalization," announced the seizure of the country's oil storage terminals from a group including Shell, ExxonMobil and Chevron. The move was recommended by a Honduran congressional commission to lower fuel prices and combat what Zelaya called "energy terrorism." US Ambassador Charles Ford immediately protested the "lack of respect to private property" and warned that "the consequences of this situation could be very serious." Two days later, the Honduran government reversed its decision.

These questions take on greater importance in light of the PPP's visions of Central America's future role as an inter-oceanic conduit for global oil.

Geography Wars

In his no-show at Campeche, Ortega was also said to be miffed by Colombia's participation in the summit. When Colombia was added to the PPP group in 2006, Ortega protested that it is not an isthmus nation. Speaking before the Campeche meeting, he explicitly invoked Nicaragua's sea-border dispute with Colombia, and accused Bogotá of colluding with other Central American governments against his country: "Colombia has been politicking with Honduras and Costa Rica to form alliances in order to strip Nicaragua of its territories in the Caribbean Sea, thus the presence of Colombia in this summit is disturbing."

Ortega was referring to a Colombia-Honduras maritime agreement which would deprive Nicaragua of much of its Caribbean coastal waters: "We want to make it clear that under no circumstances does our participation in the summit mean that we are recognizing the attempts by Colombia to take control of Nicaraguan territory in conspiracy with Honduras and Costa Rica which decided to set the border at the 15th parallel, placing Nicaragua in a difficult situation." Nicaragua has filed a World Court suit in the matter.

José Obdulio Gaviria, advisor to Colombian President Alvaro Uribe, responded that questioning Colombia's participation in the PPP summit was "a little out-of-place." Colombian Foreign Affairs Minister Fernando Araujo followed up with a statement that charged: "While Nicaragua neglects the boundary agreements in full or partially, Colombia has developed its relations with bordering countries with respect and according to international law." The communiqué reiterated Bogotá's claim to the San Andrés archipelago as Colombian territory—a cluster of islands also claimed by Nicaragua.

Not surprisingly, the issue of oil lies behind the dispute—which, even before Ortega's election, has prompted alarming sabre-rattling from Bogotá. In May 2003, Colombia's Defense Minister Martha Lucia Ramirez warned that her government was prepared to use force if Nicaragua allowed oil exploration in the San Andrés archipelago. Nicaragua responded that it had granted exploration concessions to four US companies in Caribbean offshore waters, but that the project did not involve waters under dispute. "The concessions do not include any territory claimed by other countries," said Octavio Salinas, then director of the Nicaraguan Energy Institute, adding that they were all "in territory historically of Nicaraguan sovereignty.'"

Colombia claims the San Andrés islands under a 1928 treaty, which Nicaragua considers invalid and has disputed before The Hague. The Colombian navy routinely patrols the waters around the archipelago—about 400 miles off the Colombian coast, and some 150 miles off Nicaragua. "The navy has sufficient capacity to defend and guarantee the sovereignty of our waters," Ramirez told Radio Caracól in Bogotá. "We hope we obtain peaceful solutions. We don't think that this should be solved in a military scenario." But Sen. Enrique Gomez Hurtado, head of the Colombian senate's foreign relations commission, said that if Nicaragua proceeds with the oil exploration, "we will have to use force."

Neither government seemed concerned with the potential environmental impacts of oil development in the area. The San Andrés islands are surrounded by some of the largest and most productive coral reefs in the Western Hemisphere, according to the Ocean Conservancy.

The New Orleans-based minnow MKJ insist began exploration in the disputed zone. Nicaragua maintained the exploration zone was west of the 82nd meridian, and therefore under Nicaraguan sovereignty by terms of the 1928 treaty.

Some Colombian officials were said to privately agree, but there was formal stand-down. Colombia—with a vastly superior military to Nicaragua—did not go to war, but as a retaliatory measure refused to grant visas for San Andrés' 50,000 residents to enter Nicaraguan territory.

At the time the 1928 Esquerra-Barcenas Treaty was drawn up, Nicaragua was under a dictatorship propped up by US Marines, and Augusto Cesar Sandino was leading an insurgency in the name of national sovereignty. Thus, Nicaragua argues, no legitimate Nicaraguan government ever approved the treaty.

Nicaragua's sea border dispute with Costa Rica is also heating up at the current juncture. Nicaragua's Foreign Minister Samuel Santos April 16 defended his navy's seizure of Costan Rican leisure boat El Privilegio, saying the vessel had violated Nicaraguan waters. He rejected Costa Rica's demand for the boat's immediate return. A statement from Santos charged the vessel "was in clear violation of international security norm... No one aboard had verifiable official documentation." He said the detention was "in the context of...fighting crimes at sea."

Costa Rican Foreign Minister Bruno Stagno, in turn, accused the Nicaraguan military of crossing into Costa Rican waters to seize the boat, illegally detaining four Costa Ricans and two US citizens. He also rejected Ortega's charges of Costa Rican collusion with Colombia and Honduras to pillage Nicaraguan resources. "Naturally my government rejects this... attitude that goes against our nations' historical links of friendship and brotherhood," Stagno said.

Costa Rica and Nicaragua are currently attempting to negotiate a treaty over their maritime borders.

As governments bicker, popular opposition to any oil development is mounting. MKJ of New Orleans opted for the disputed San Andrés archipelago after plans to drill for oil near Limón on Costa Rica's Caribbean coast were halted the previous year in the face of concerted opposition from local fishermen and environmentalists.

Costa Rican activists in the citizens' coalition Acción de Lucha Anti-petrolera (Action for Anti-Petroleum Struggle, ADELA) also mounted effective opposition to an offshore drilling contract granted to George W. Bush's former company Harken Energy of Houston in 2002. Including over 60 municipal governments, environmental and indigenous groups and fishing and tourism concerns, ADELA organized media campaigns and public protests that finally moved Costa Rica's Ministry of Environment & Energy to cancel the deal.

In January 2004, when Harken sent former US senator Robert Torricelli to negotiate in the company's demands for $9 million in compensation for the cancelled contract, he was met with with a large protest of ecologists with drums and large banners.

When Guatemala announced the opening of an oil exploration zone in the Lake Izabal region in 2002, a similar coalition emerged to oppose it—with local Kekchi Maya communities at the forefront. Municipal leaders even threatened to shut down the ports of Puerto Barrios and Santo Tomas, Guatemala's only access to the Atlantic—prompting then-President Alfonso Portillo to cancel the concession.

The Specter of the Canal

Far more geo-strategically significant than access to a small archipelago (even one with oil potential) is the question of control of corridors for inter-oceanic trade—the most ambitious visions of the PPP. The Panama Canal can no longer accommodate modern super-tankers, and the ultimate aim of the PPP is to build a replacement elsewhere on the isthmus.

Last October, with the presidential elections still pending, Nicaragua announced plans to build a new canal through its territory. Then-President Enrique Bolaños said the new artery would cost $18 billion and take 12 years to complete. Speaking to a Managua meeting of Western defense ministers—including Donald Rumsfeld—Bolaños called for international backing for the Inter-Oceanic Nicaragua Canal. "The galloping increase in world business demands another canal in addition to a widened Panama Canal," he said.

The announcement came days before Panamanians went to the polls Oct. 22 to vote on an unprecedented expansion of their existing canal. Under the proposal, wider locks and deeper access lanes would enable the canal to accommodate ships carrying up to 10,000 containers. The current limit is 4,000 containers. Critics argued that by the time it is finished in 2015, it will already be outmoded. But voters approved the project, and in March Panama hosted a conference to announce what contracts would be up for grabs—attended by more than 600 representatives from 222 companies from 31 countries.

So another race appears to be underway. But the obvious place for the Nicaraguan canal is on another contested border—the Rio San Juan, which forms the frontier with Costa Rica. This strategic artery flows from giant Lake Nicaragua to the Caribbean, leaving only a narrow strip of land between the lake and the Pacific. It was eyed as a canal route in the 19th century, but the US chose Panama after an 1893 revolution brought the nationalist regime of José Santos Zelaya to power in Nicaragua. Today the river is claimed wholly by Nicaragua. Costa Rica challenges this claim—and in September 2005 brought suit over the matter at The Hague. Nicaragua responded with a reprisal entry tax levied on Costa Rican citizens, and Managua officials even invoked Nicaragua's historical claim to the northern Costa Rican province of Guanacaste.

The most ambitious scheme which has been floated for the San Juan basin is the "Grand Canal," which envisions the historical of irony of Nicaragua as the replacement for the Panama Canal. In a revival of the 19th-century scheme, the Rio San Juan would be dramatically widened and dredged, and the strip between the lake and the sea blasted through. However, the Grand Canal would cost more then ten times Nicaragua's annual GDP.

Others in Managua have proposed an "Eco-Canal," priced at just $50 million, which would make "low-impact" use of the river and lake. The river would be dredged in places but maintain its natural banks. Instead of traditional locks, air-powered moveable dams would be used to assist cargo barges to pass two stretches of rapids. The Eco-Canal would serve national and regional trade, rather than compete for a share of the international container market. Nicaragua's National Assembly approved a feasibility study for the Eco-Canal in 2003.

Numerous "dry" schemes for a Nicaraguan inter-oceanic link are also pending. The Florida-based Phenix Group is seeking to build an oil pipeline across Nicaragua. In 2001, two companies—Interoceanic Canal of Nicaragua (CINN) and Global Intermodal Transport System (SIT-Global)—were granted approval by Nicaragua's National Assembly to conduct feasibility studies for a "Dry Canal" of pipelines, highways and high-speed rail with free trade zones and containerized shipping ports on either side. Parsons Brinckerhoff of California conducted similar studies in the 1990s.

The "dry" project's planned route actually cuts north of the San Juan basin and Lake Nicaragua, linking the little Caribbean coast town of Monkey Point to the Pacific port of Corinto. Either the San Juan basin or "dry canal" route would cut through remote rainforest and impoverished peasant regions.

The "dry" projects are strongly opposed by the community of Monkey Point, made up of Black Creoles, mestizos and Rama indigenous. Under the Phenix project, tankers would anchor two miles off Monkey Point and connect to oil-collecting buoys. The oil would then be pumped through an underwater pipeline to a Monkey Point marine terminal. From there, up to 480,000 barrels would be pumped daily across Nicaragua through three underground pipelines to Corinto. Phenix CEO Rick Wojcik said in 2003: "We're looking at long-term funding with the World Bank, we're in discussions with the World Bank, [and] we've been assigned a case officer from the World Bank."

Researcher Ben Beachy of the Nicaragua Network, a US-based solidarity group, noted that forested areas in the path of the projected pipeline include the Cerro Silva Natural Reserve. The pipeline would also sever the Mesoamerican Biological Corridor, a World Bank project purportedly established to protect the rich biodiversity of Central America's rainforests. But Wojcik told Beachy: "We're not a clear-cutting timber company." He claimed the project would require "only a couple hundred meters through the jungle."

Wojcik claimed that after pledging that pipeline would adhere to environmental guidelines, Phenix received a letter from Monkey Point residents indicating their "full support" for the project—signed by Pearl Watson, a village nurse. But when asked by members of the Nicaragua Network if she signed the letter, "Watson laughed, said she had never signed or seen such a letter, and declared the community's opposition to the proposed pipeline project."

Watson told the Nicaragua Network: "People [in Monkey Point] live on the fishing and producing of the land. What benefit will we get from losing our sea goods, losing our wildlife?" She also expressed concerns about oil spills in the area. "I don't care how much you take care; the oil will spill in the water." Finally, she feared that local residents will be stuck with the mess after the corporations move on. "In 25 or 30 years you won't have much forest around [and] after there is no more oil to pass through the pipeline, they [Phenix] are going to leave and the community will have no fish in their streams. We inherited this land from our ancestors, and if we destroy this land we will leave nothing for our children and grandchildren but barren land, from which they can produce nothing."

Nicaraguan indigenous rights lawyer Maria Luisa Acosta told the Nicaragua Network that Monkey Point does have some legal tools to obstruct the project. With the passage of the "Demarcation Law Regarding the Properties of the Indigenous Peoples and Ethnic Communities of the Atlantic Coast, Bocay, Coco and Indio Maiz Rivers" in 2002, the Nicaraguan government officially recognized that Monkey Point and its surrounding lands belong to their indigenous inhabitants. Under this law, Phenix is legally obligated to conduct formal consultations with Monkey Point community members and provide "full disclosure" before implementing development plans.

However, Nicaragua's National Commission for Demarcation of Indigenous Lands (CONADETI) has been under-funded and fraught with scandal despite the urgency of its task, leaving indigenous communities like Monkey Point without clear title to their territories. Cesar Paiz, a representative of the planned demarcation commission, told the Nicaragua Network: "We know that behind many of the worst [land rights] conflicts there are powerful business interests, seeking to exploit the lands inappropriately. It is important now to get organized and seek support to enable the law to be properly implemented."

New Pressures from Below

Mexico, the leader of the PPP, has seen similar opposition from indigenous and peasant communities, environmentalists and popular movements. This was clearly evidenced in the days around the Campeche summit.

Security at the Campeche summit site was overwhelming. The city's hotel zone and convention center were cordoned off by five lines of police and military troops, with reinforcements standing by in two army trucks. Sharpshooters in camouflage gear were stationed on rooftops in the zone. Nonetheless, some 150 protesters from the Broad Progressive Front (FAP) and other organizations braved this intimidation.

However, April 10 also marked the 88th anniversary of the assassination of Emiliano Zapata, and marches held in commemoration elsewhere in the country denounced the PPP. In Xalapa, capital of Veracruz state, followers of the Agrarian Indigenous Zapatista Movement, the Popular Front of Organizations of Southeast Veracruz, the Regional Council of Nahua and Nuntaj Pueblos and the Zapatista "Other Campaign" held a march against the PPP. Protest leader Daniela Griego said the project would represent the "destruction of our natural resources."

In conflicted Chiapas state, thousands marched in the capital Tuxtla Gutierrez and blocked roads throughout the state under the slogan "Por Un Nuevo Reparto Agrario" (For a New Agrarian Reform). The protests were organized by the National Front of Struggle for Socialism (FNLS) and the Chiapas State Coordinator of Autonomous Organizations.

In Oaxaca, Carlos Beas Torres, leader of the Union of Indigenous Communities of the Isthmus Northern Zone (UCIZONI), an affiliate of the Mexican Alliance for the Self-Determination of the Pueblos (AMAP), told a meeting against the PPP that the only ones to profit from the project would be people like Mexican magnate Carlos Slim, "the world's third richest man," whose Grupo Carso would likely win lucrative contracts in oil and telecommunications development. He said the PPP "is not a development strategy," but "clearly a business plan that undermines our national sovereignty."

Protests were also held in Mexico City, where campesinos from Veracruz, Oaxaca and elsewhere marched on the Government Secretariat and blocked traffic. Representatives of both radical bodies such as the Popular People's Assembly of Oaxaca (APPO) and the semi-official National Campesino Confederation (CNC) participated.

The PPP has become a key concern of the movement for indigenous autonomy which has been building in Mexico since the 1994 Zapatista rebellion in Chiapas. In 2001, after years of fitful negotiations, Mexico's Congress approved a package of constitutional reforms on indigenous rights as a measure to end the Chiapas conflict. However, the Zapatistas rejected the reforms after lawmakers stripped all binding provisions on indigenous control of land and natural resources. The package was nonetheless upheld by the Mexican supreme court in 2002. While continuing to observe their cease-fire, the Zapatisas have not returned to the dialogue table since.

In December 2002, the Coordinator in Defense of Territory and Indigenous Peoples of the Isthmus of Tehuantepec issued a statement denouncing the non-binding referendum planned by the National Commission for the Development of Indigenous Peoples (CNDPI) for the Indians of Oaxaca, saying the vote amounted to a "tacit acceptance" that the Zapatista peace plan on indigenous rights will not be fulfilled. The group also denounced the vote as propaganda for the PPP. Oaxaca's Isthmus of Tehuantepec is another location historically eyed as a candidate for an inter-oceanic canal. Although the government denies that various mega-development projects planned for Oaxaca are part of the PPP, one question in the referendum asked: "Would you be in favor of projects for your community if they were financed by the Puebla-Panama Plan?"

Mexican authorities have nearly openly acknowledged that pressure from below has slowed progress on the PPP. In October 2003, at a Mexico City summit with his counterparts from Guatemala, Honduras, El Salvador and Costa Rica, as well as high-level representatives from Nicaragua and Panama, Mexico's then-Foreign Relations Secretary Luis Ernesto Derbez Bautista held a joint press conference in which he stressed that the assembled governments are committed to the PPP. But he also said that the governments have not done enough to emphasize the benefits of the development project to civil society.

After the meeting, the Mexican Alliance for Peoples' Self-Determination (AMAP), representing various indigenous and campesino groups in Puebla, Veracruz, Guerrero, Oaxaca and Chiapas, issued a statement protesting the "silent imposition" of the PPP. The statement charged that development projects are advancing "without even minimal consultation with indigenous peoples and campesino communities." The statement especially cited expansion of the Benito Juarez hydro-electric plant in the Isthmus of Tehuantepec and construction of the Oaxaca-Huatulco super-highway, cutting through Oaxaca's marginalized Sierra del Sur. The statement also demanded liberation for political prisoners arrested after involvement in building Zapatista-style "autonomous municipalities" in Veracruz and other states.

Earlier that year, calling the PPP "a crime against our communities," Marcelino Diaz de Jesus of the Nahua Council of the Alto Balsas, an indigenous group based in the southern Mexican state of Guerrero, formally filed a complaint before Geneva hearings on Economic, Social and Cultural Rights, held by the UN Subcommission on Promotion and Protection of Human Rights. A complaint against the mega-project was also filed by the US-based International Indian Treaty Council (IITC).

Little more than a month after the supreme court approved the gutted constitutional reforms in 2002, hundreds of Zapatista sympathizers marked Dia de la Raza (Oct. 12) by blocking the entrance to the main Chiapas military base, Rancho Nuevo, to demand demilitarization of the conflicted southern state—and to protest the PPP. "These lands belong to the people and we will not abandon them," said one protest leader. "The riches belong to those of us who have lived here for centuries and we will oppose their globalization."

Zapatista sympathizers also filled Mexico City's central plaza, the Zócalo, to protest the PPP—many with their faces hidden by the signature red bandana of the Zapatista rebels. Led by an elderly couple carrying a Mexican flag, the marchers stopped along the Paseo de la Reforma to pay homage to the statue of Cuauhtémoc, the last Aztec emperor. "Although the infamous invaders burned his feet, the heroic Cuauhtémoc never turned over the gold, as we won't turn over the country!" shouted Efran Capiz, leader of the Emiliano Zapata Union of Communities.

Mixtec and Zapotec Indians also blocked highways in Oaxaca to protest then-President Fox's mega-development plans for the state. "The people who live here are campesinos. These projects will take away their livelihoods," said Gabriela Rangel Faz of the Mexican Action Network Against Free Trade, which helped coordinate the protests. "Look at what happened with other dams they built in the south. The government said the people would have nice homes, good land, schools and roads when their land was taken. They got only low-quality land and tiny shacks." In conjunction with the protests, activists formally petitioned the International Labor Organization (ILO) to censure Mexico for non-compliance with ILO-69, a treaty stating that indigenous peoples must be consulted on development projects that will affect their lands.

Such principles were also raised in the statement issued by leaders of the Dia de la Raza march in Chiapas, representing several local indigenous and campesino groups, including the Emiliano Zapata Campesino Organization, the National Coordinator of Indigenous Peoples, and Civil Society in Resistance. The statement said the Supreme Court decision "definitively closes the doors to a dialogue necessary to construct peace in the state of Chiapas and all Mexico... The 'indigenous law' traitorously imposed by the Congress of the Union and by Vicente Fox, and now ratified by the Supreme Court of Justice of the Nation, only serves the great multinational companies that seek to plunder the strategic resources of Mexico through the Puebla-Panama Plan and the Free Trade Area of the Americas."

As governments fight it out over the fate of the Mesoamerican isthmus in the 21st century, popular and indigenous movements may ultimately have the last word on whether the numerous mega-development projects will be able to proceed.

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RESOURCES:

Plan Puebla-Panama
http://www.planpuebla-panama.org

Bolivarian Alternative for the Americas (ALBA)
http://www.alternativabolivariana.org/