During his first weeks in Office, president Daniel Ortega met with national companies and transnational corporations, which are investing or plan to invest in Nicaragua.

Ortega’s policy is aimed primarily at creating a climate of stability and peace, to show the country and the international community that his government is not driving investment away and that Nicaragua will be a magnificent option for foreign business operators. An economic, but at the same time political support, that will enable Ortega to further his government agenda without encountering major problems.

While on the one hand this is an understandable attitude for the new government to have, as it helps dispel the doubts and prejudices that have surrounded the figure of Daniel Ortega in many national and international circles, on the other hand it is very disquieting that, to date, these transnational corporations have not been required to make any firm commitments regarding the human, labor and union rights of Nicaraguan workers.

The recent arrival to Nicaragua of Warren Stanley, president of the transnational corporation Cargill, and his meeting with Daniel Ortega and the presidential advisors, is yet another example of an economic policy that has still not defined what kind of development model this government wants to implement and what instruments will be used to do it.

Although the new president inaugurated his administration with the “Zero Hunger” Program – a program that delivers production inputs to farmers so that they can produce food, recycle anything recyclable, and quickly overcome malnutrition – and created the Food Security and Sovereignty Council, coordinated by the sociologist and economist Orlando Nuñez Soto, he has also given his full support to a company like Cargill, whose development model is the exact opposite of Food Security and Sovereignty, only requiring in exchange that the investment be accompanied by certain social aspects to the benefit of the population.

Cargill and its philosophy

In his book “Invisible Giant: Cargill and its Transnational Strategies” the economist and theologian Brewster Kneen describes Cargill as “an agribusiness, food and financial complex that operates in 72 countries, including several Latin American ones. This “empire,” founded some 140 years ago by William Cargill, is much more powerful than Monsanto’s. It employs 80,000 workers distributed throughout the planet and its activities include marketing, manufacturing and distributing agriculture, food, financial and industrial goods and services. Cargill is the prototype of the corporations that dominate the world’s economy today. In the year 2000, these corporations accounted for 12 percent of the world’s Gross Domestic Product, moving approximately 3.5 billion dollars.”

This company’s philosophy was spelled out by its former president, who upon stepping down said that “there is a misguided belief that the greatest agricultural need of the developing world is to reach a production capacity that will cover domestic consumption. This is a mistake. Each country must produce what it produces best and market it.” This idea was confirmed and strengthened by the then vice president, Robin Johnson: “breaking the siege of poverty means going from subsistence farming to market agriculture. Subsistence farming prevents farmers’ income from growing, keeps populations outside the food marketing system and thus makes them more vulnerable to natural disasters, damaging the environment.”

In contrast, many have opted to promote subsistence farming, family farming, and local markets, that is, everything that goes against the Cargill model, which is the predominant production model in the world today. According to agricultural ecology expert Peter Rosset¹ “food sovereignty is the right of all peoples to define their own food production, distribution and consumption system. It is the right of rural communities to access land, to be able to produce for their own local and national markets, to not be excluded from those markets by the imports of the transnational corporations. It is also the right of consumers to access food that is healthy, affordable and culturally suitable for their cooking practices and their country’s culinary history, and which is produced locally. If a country is incapable of feeding its own people, if their next meal depends on the world market, that country is extremely vulnerable. A vulnerability that leaves them at the mercy of the good will of the superpowers and of market fluctuations. That’s why we talk of sovereignty.”

But the problem is not just the development model, it is also the instruments and methods that are used to implement it. In the case of these transnational corporations, the instruments are often the exploitation of the local workforce and the violation of their human, labor and union rights. Nicaragua, its new government and its development agenda cannot afford to go down any other road than that which leads to an employer-worker relationship that fully respects the rights guaranteed by national laws and international conventions.

In his meeting with Cargill’s executives, Daniel Ortega said that “the country would provide the guarantees and security necessary for them to continue with their investments, because what Nicaragua needs are long-term investments. We have been meeting with Nicaraguan and foreign business operators and what we are asking is that investments be accompanied by social aspects that will contribute to combat poverty.

“We’ve had a positive reaction from all the investors we’ve discussed this matter with. We are even holding several meetings towards defining investment areas aimed at generating jobs in the short-term, using national raw materials and including social aspects that will benefit the population. We are convinced – Ortega concluded – that your investment in this country, the jobs it is generating, the direct and indirect impact in economic and social terms are all going in the way of combating poverty, and I invite every foreign investor to join us in this battle. Nicaragua is a country that is willing to continue to work and expand these investments, and it is important for you to be comfortable here, have peace of mind and feel secure.”

What will the cost of this peace of mind and security be?

In August 2006, the International Meeting of Cargill Workers was held in São Paulo, Brazil, organized by the national food workers’ confederation CONTAC/CUT (Confederação Nacional dos Trabalhadores nas Indústrias da Alimentação). At that event, Gerardo Iglesias, Latin American regional secretary of Rel-UITA (International Food Workers’ Union), declared that “at this meeting we are making the decision to relentlessly combat this transnational corporation which has brought back feudalism, causing severe repetitive strain injuries (RSI) and serious illnesses due to the intense work pace that workers are subjected to, adopting antiunion practices and generating serious social and environmental problems in every country it is established.”

Daniel Ortega and Vice President Jaime Morales

During a great strike called against Cargill in 2005, the president of CONTAC, Siderlei de Oliveira, remarked:  “Cargill should be in the Guiness Book of World Records, because what it’s capable of doing against its workers is incredible. It’s an opportunistic company, shifting quickly to any sector where it feels it can obtain a greater and quicker profit, and applying policies that are not only harmful to the workers, but also to the other industries in the sector. In this case, the company refuses to honor the agreements signed between the union and the poultry industry, thus generating a unanimous rejection from its workers. As the workers paralyzed the plant, the company has began hiring other workers to perform tasks. These antiunion actions and the company’s disregard for the most basic rights of their employees has only intensified the negative reactions of various organizations towards these policies deployed by a company that is amongst the most powerful in the world.”²

FUTATSCON speaks out

In response to this situation, the United Federation of Food Workers of Nicaragua (FUTATSCON) has issued a declaration. “In Nicaragua, like in every other country in the world, transnational corporations have been operating for many years, and they have been conducting their businesses without any obstacles from the governments. The only obstacle they’ve met with (if we can call it an obstacle) is the existence of some unions. In our country, since the “arrival of democracy” in 1990, the presence of transnational corporations has become massive and their profits have grown indiscriminately. As they grew, our labor conditions and wages started to deteriorate, we lost rights that had been conquered with the revolution, we suffered increasing abuses to our human rights and attacks on our unions, and we were introduced to precarious employment, flexibilization, outsourcing and “solidarismo.” All this with the open complicity of whichever government was in power…

…In response to the stance taken by national business operators and the government with respect to investment and the necessary guarantees to develop it, our federation declares: “We are not opposed to foreign and national investment provided it respects the rights of workers, the rule of law, fundamental ILO conventions and union rights. That is, we also demand the guarantees necessary to be treated like human beings. While it is true that the country needs investment to generate jobs and combat the poverty inherited from the past three governments, this cannot entail giving a blank check to investors, so that they can treat Nicaraguan workers as they please and create precarious employment.”

The statement goes on to give a profile of Cargill, owner in Nicaragua of the poultry company Tip Top Industrial, and of its constant violation of human and union rights throughout Latin America.

“Consequently, Cargill is not the transnational corporation that is coming to help bring the country out of poverty, as president Ortega asks. Like any other company of its kind, its sole interest is to profit and exploit workers. In order for us to believe in the feasibility of what he said to the president of Cargill, Warren Stanley, the company must begin by allowing unions to be formed in its processing plants and restaurants, where the only thing that exists today is solidarismo, which is used as an instrument to prevent the union from acting...

…With such attitudes, will they really help bring Nicaragua out of poverty? They have not done it so far and they will not do it now. In order for us to believe them, they must allow free unionizing, they must stop abusing and humiliating their workers, they must be willing to negotiate and honor collective agreements and they must maintain labor stability.

A way for them to really contribute to bring down poverty indexes would be by improving working conditions, raising salaries, observing the country’s tax, labor and free competition laws, improving environmental conditions in the country, locally and in the community, and refraining from bribing government officials, without corruption and with transparent financial statements. If they do all this, then we would agree that foreign investment is worth it; otherwise it’s nothing more than words and promises.”

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