ALBA, an Economic Alternative for Latin America

The sixth conference of the Latin American alternative trade
alliance known as ALBA-which stands for the Bolivarian Alternative for
the Americas and means “Dawn” in Spanish-was held in Caracas on January
25-26. The brainchild of Hugo Chavez and Fidel Castro, ALBA was founded
by Cuba and Venezuela in 2004 as a fair trade alternative to US-backed
free trade policies and is made possible thanks to Venezuela’s oil
money.

When Evo Morales was elected in Bolivia and Daniel Ortega in
Nicaragua, they too joined ALBA, which Chavez has nicknamed the Club of
“Chicos Malos”, or bad boys, because of its opposition to U.S.
domination. At this weekend’s meeting, the Caribbean island of Dominica
also joined, and representatives attended from Ecuador, Honduras,
Uruguay, Haiti and several other Caribbean nations.

Chavez opened the session talking about the need for a trade system
that addresses people’s needs, not corporate profits. He railed
against the “dictatorship of global capitalism”, and encouraged Latin
American countries to withdraw their international reserves from United
States banks, warning of a looming US economic crisis. “Why does that
money have to be in the north?”, he asked. “We should start to bring
our reserves back home.”

His thoughts were echoed by Daniel Ortega, who blamed the capitalist
system for the environmental crisis. “The capitalist model of
development is simply unsustainable,” Ortega declared. “If your economy
is controlled by speculative capital that only cares about profits, you
can’t solve the huge problems affecting humanity. Once we renounce the
free trade model, we can begin to address the massive problems of
unemployment, poverty and global warming.”

Bolivia’s Evo Morales, who is facing fierce opposition in part
because of his efforts to nationalize natural gas and oil, insisted
that key public resources such as land, water and energy should not be
for private profit but for the common good. He also insisted that Latin
America should not look to the United States for solutions, since U.S.
aid always comes with strings designed to increase its hegemony.

“In 1990s, the World Bank and the International Monetary Fund
imposed their disastrous policies, and then the U.S. tried to impose
the Free Trade Agreement of the Americas-which should really be called
the Free Profits Agreement of the Americas because it is meant to
increase the profits of US corporations,” said Morales. “But people of
the hemisphere rejected that agreement, so now the U.S. is
trying-country-by-country-to get bilateral trade agreements. They are
always trying to divide us, but we salute the great resistance to
empire that we see throughout the hemisphere.”

The leaders noted that it was no coincidence that just at the time
of the ALBA summit, Condoleezza Rice was visiting neighboring Colombia
to promote a U.S.-Colombia Free Trade pact. Chavez, who recently called
Colombia’s President Urribe a “sad peon of the empire”, laughed at U.S.
accusations that he, Chavez, was facilitating the flow of Colombian
cocaine through Venezuela.

The talk of drug-smuggling turned into comic relief, however, when
Chavez launched into a discourse on the benefits of the coca leaf,
which, he insisted, was very different from cocaine. U.S. officials
have long tried to eradicate coca cultivation, which has been grown and
chewed by Andean Indians for centuries.

“Speaking of drugs,” Chavez turned to Bolivian President Evo
Morales, who is himself a former coca farmer and is a strong defender
of the coca leaf, “where are the coca leaves you used to bring me?”

A Bolivian Indian sitting behind Morales got up and offered up his
personal stash of coca leaves. Delighted, Chavez took a leaf and put it
in his mouth. “The sacred leaf of the Inca, the Aymara Indians,” he
declared. “Thank you, brother.” Emphasizing the great qualities of
coca, Chavez said that he had become used to chewing the leaves every
morning and invited the other heads of states to try some.

The laughter reached new heights when Chavez welcomed Prime Minister
Ralph Gonzalez of St. Vincent and Grenadines to the Club of the Bad
Boys and asked, in broken English, “Do you want some coca?” Imagining
the headlines back home, the Prime Minister politely declined. “I’m a
good Catholic boy who only occasionally associates with bad boys,” he
joked.

The meeting turned serious, however, when it came time to sign
economic agreements. Nicaragua, for example, pledged to help supply
milk, corn, beans and beef to Venezuela, while Venezuela will sell
Nicaragua oil under preferential terms to Nicaragua. Cuba has an
agreement to send doctors to Venezuela in exchange for oil discounts.

The most significant moment of the summit was the announcement of
the creation of a regional development bank intended to strengthen
their alliance and promote independence from U.S.-backed lenders like
the World Bank. The ALBA Bank will be started with $1 billion to $1.5
billion of capital. Venezuela, with its plentiful oil earnings, will be
the leading financier. The funds will go toward joint efforts from
farming projects to energy ventures, such as hydroelectric energy using
Dominica’s abundant rivers and Nicaraguan technology.

Chavez and the leaders of six other South American countries last
month launched a similar venture, the Bank of the South, which is
projected to have as much as $7 billion in startup capital and offer
loans with fewer strings attached than those given by the World Bank or
the International Monetary Fund.

A major question about the future of ALBA is whether more countries
will join to give it more clout. Ecuador and Haiti, for example, would
like to join but are facing strong internal opposition. Several small
Caribbean nations attending the meeting mentioned how difficult it is
to counter attacks by the conservative media. “The principles of
ALBA-solidarity, non-interference, respect for independence,
complementarity instead of competition, fair trade-they are like
motherhood. You can’t be against them,” Prime Minister Ralph Gonzalez
of St. Vincent and Grenadines reasoned. “But when you start to add
names-Chavez, Castro, Ortega-people get scared. So we have to educate
our people before we can become full members.”

Dominica, a nation that defied elite pressure by joining ALBA, was
already facing the backlash. “While we are here talking about ways to
improve the lives of our people, the conservative media is talking
about economic ruin, communist influence, Iranian takeovers, an end to
tourism,” tourism minister Ian Douglas told me. “We will weather the
storm, but it’s not going to be easy.”

One way to get around such government pressure is to allow the
participation in ALBA of social movements throughout the hemisphere. At
last year’s summit, the ALBA Council of Social Movements was formed
with representatives from farmers groups, women, environmentalists,
unions and other civil groups. But there were unresolved questions over
how to structure the Council, so this year, only the social movements
in the four member countries were invited. The Council, however,
proposed expanding membership.

“The best way to strengthen ALBA is to include social movements from
throughout the hemisphere,” said Joel Suarez of Cuba’s Martin Luther
King Center, one of the five movement reps from Cuba to attend the
Summit. “Governments may be pressured not to join, but the social
movements are anxious to be part of an alliance that promotes fair
trade over free trade.” Indeed, the proposal is to even include social
movements from the United States. Venezuela is already working with
U.S. groups and local governments to provide discount heating oil to
poor U.S. communities.

With ALBA countries, particularly Bolivia and Venezuela, facing
strong internal opposition, improving the population’s economic
well-being is critical. The future of progressive victories in Latin
America rests on turning the rhetoric of fair trade and sustainable
development into concrete gains. This year will be a critical test of
whether Venezuela’s oil money can indeed be used to develop an
alternative economic model.

Medea Benjamin ([email protected]) , cofounder of Global Exchange (www.globalexchange.org) and CODEPINK: Women for Peace (www.codepinkalert.org),
was an invited guest at the ALBA Summit. Global Exchange organized
monthly people-to-people delegations to Venezuela and other ALBA
countries.