NetNews Usenet Archive 1992 #18/NN_1992_18.iso/spool/misc/activism/progress/5967

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From: [e-mail] (Rich Winkel)
Subject: El Salvador: Proceso 525
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/** reg.elsalvador: 146.0 **/
** Topic: Proceso 525: News Briefs **
** Written  9:35 pm  Aug 20, 1992 by [e-mail] in cdp:reg.elsalvador **
From: [e-mail] (Centro de Informacion Documentacion y Apoyo a la Invest. - UCAJSC)
Subject: Proceso 525: News Briefs

Center for Information, Documentation and Research Support (CIDAI)
Central American University (UCA)
San Salvador, El Salvador

PROCESO 525
August 12, 1992

NEWS BRIEFS:

WAGE HIKE:  Last July 29 the Ministry of Labor decreed a wage and
benefits increase for construction workers. According to the
measure, skilled workers will be raised from 31 to 36 colones per
day ($4.35), while unskilled workers will receive a raise from
25.52 to 31 colones per day ($3.75), or 18%. Life insurance
policies provided by construction companies to their workers must
increase their coverage from 6,000 to 7,500 colones ($843), as well
as compensation of 675 colones ($81) to families of deceased
workers. The raise was the result of compulsory arbitration which
put an end to negotiations between the Salvadoran Chamber of
Construction (CASALCO) and the Union of Construction Workers
(SUTC). The Labor Minister announced the pact with evident
satisfaction, while CASALCO announced on August 11 that the
increase would affect production costs, which would thereby produce
an increase in the price of housing. SUTC and UNOC declared on
August 12 that the agreement was the product of a nine-month worker
struggle, adding that the increased wages and benefits would not
increase the price of housing as much as CASALCO had warned, since
they only affect labor costs and not those of materials.

FOREIGN AID:  Ministry of Planning sources reported on
international aid to El Salvador between June 1991 and May 1992,
stressing that both donations and loans would begin to arrive
gradually over the next three years. The greatest amount of aid
comes from USAID, with 75% of the donations, while 25% of the
resources come from sources such as the World Bank and government
funds. In 1991, a number of loan agreements were signed with
multilateral lending agencies such as the IMF, which loaned $60
million for the government's 1991 economic program. The World Bank
has loaned $37 million for social programs and technical assistance
to the power system; the Inter-American Development Bank, the chief
source of financing for the 1991 economic program, holds a whole
portfolio of loans and donations, with 3 contracts signed for a
total of $160 million and two technical cooperation donations for
$5 million; the Central American Bank for Economic Integration has
awarded $9 million in loans for small agricultural producers.

CRIME:  A number of emergency rescue units have reported an
increase in criminal activity, especially during the August
holidays. Commandos de Salvamento reported an increase in personal
assaults despite increased vigilance on the part of security forces
(although they mentioned that the vigilance was quite weak in many
areas). The Salvadoran Red Cross reported that 90% of the cases it
treated during the first week of August involved persons attacked
in buses, sports arenas, beaches, stores and on the street.
Spokespersons of the Rosales Hospital also reported that its three
emergency operating rooms were insufficient to treat the enormous
number of knife and gun wounds inflicted during that period.

MURDERS:  Over the last several days there have been a number of
murders of trade union leaders. On July 30, the Secretary of
Conflicts of FENASTRAS was assassinated in a downtown restaurant.
According to statements made on August 7 by members of FENASTRAS,
the assassin was a man who entered the establishment for the
express purpose of killing his victim. FENASTRAS also said that
this was the second union member murdered over the last several
days. On August 10, the Association of Employees of the Ministry of
Public Works (ATMOP) reported that two members of its Santa Ana
local had been murdered as well, and demanded that the crimes be
investigated. ATMOP also said that both cases were made to look
like common crime, although one of the victim was stripped of
papers dealing with union activities. FEDECOOPADES denounced the
ransacking of its offices in Santa Ana on the night of August 1.
The FMLN condemned all these incidents and tied them with the
August 4 attack on one of its members in Santa Ana, claiming that
a dirty war was underway as well as an Armed Forces campaign
against the peace process.


** End of text from cdp:reg.elsalvador **

/** reg.elsalvador: 147.0 **/
** Topic: Proceso 525: Economy **
** Written  9:35 pm  Aug 20, 1992 by [e-mail] in cdp:reg.elsalvador **
From: [e-mail] (Centro de Informacion Documentacion y Apoyo a la Invest. - UCAJSC)
Subject: Proceso 525: Economy

Center for Information, Documentation and Research Support (CIDAI)
Central American University (UCA)
San Salvador, El Salvador

PROCESO 525
August 12, 1992

ECONOMY:
Needs of the agricultural sector

     The role of land distribution within the program to
reintegrate former FMLN combatants into civil society is vital. In
fact, delays in land distribution have bogged down the peace
accords, especially with regard to the demobilization of the second
contingent of FMLN combatants.
     According to the revised land inventory presented by the FMLN
last April, which is currently being verified, the total land area
in conflict zones is approximately 665,000 acres, which is around
18.5% of national territory and greater than the total of all lands
affected by the 1980 land reform (approximately 173,000 acres). If
the FMLN's figures are accurate, we are looking at the greatest
land distribution of the last several decades.
     The distribution of lands is accompanied by the challenge of
increasing agricultural productivity, and for this it is important
to define clearly the criteria which will govern credit assistance
to the agricultural sector, as well as the types of landholding
which will be promoted.

Credit assistance

     The recent experience of agricultural producers in the land
reform sector demonstrates the clear need to revise agricultural
credit policies. In the first place, the economic success of the
new producers requires credit under especially favorable
conditions; in the second place, there is a tendency to favor
credit for export crops over basic grains.
     The most troublesome problems with regard to agricultural
credit are the repayment conditions and the criteria used to
evaluate credit applications. With regard to repayment of loans,
the time period must be longer and there must be a preferential
rate of interest which, as we will see further on, is not a
proposal but rather a recent precedent.
     However, above and beyond awarding preferential conditions for
payback of loans, it is also important to draw up a priority list
of projects to be implemented which will help guarantee their
profitability. The choice of crops to cultivate could serve as a
good rule of thumb.
     This would allow for an opportunity to begin promoting the
diversification of the agricultural sector in such a way as to
shore up export crops which prove capable of generating foreign
exchange, and which might substitute traditional export crops
-particularly cotton and coffee- where profitability has dropped
drastically over the past several years. The profitability of
coffee is so diminished that in early July, the Central Reserve
Bank announced a new credit line aimed at financing the unpaid
balances of previous loans. This credit line enjoys a 12-year term
and an interest rate of 15.5%, just slightly lower than the 16%
charged by commercial banks in normal credit operations.
     It is indeed possible to open new lines of credit with
preferential conditions for beneficiaries of the land about to be
distributed, even more so if we consider that the resources used to
award the loans can be drawn from foreign donations.
     The greatest problem appears to reside in the choice of
projects to implement, since this largely depends on the
profitability of certain crops and the possibility that they will
remain in production. However, there is also a need to adopt forms
of landholding which guarantee the greatest agricultural yield.

Agricultural yield and forms of landholding

     The land reform evaluations conducted by the Ministry of
Agriculture and Livestock provide information on agricultural and
livestock-raising activities in the land reform sector, and also on
the rest of this sector nationwide. Based on the figures provided
by the four most recent evaluations (VII-X), we can conclude that
the land reform sector uses forms of organization of production
which in some cases yield more than those obtained by the non-
reformed sector, at least in basic grains and traditional export
crops as a whole.
     However, the level of participation in national production
activities on the part of the land reform sector is still not very
considerable. The land reform sector produces approximately 10% of
basic grains, 12% of coffee, and 37.8% and 37.6% of sugar and
cotton, respectively. This might be due to the relatively small
proportion of arable land held by this sector. According to the
tenth evaluation, conducted in 1990, the land reform sector farmed
19.1% of total arable land, and 13.8% of the national territory.
     The chief characteristic of the land reform sector is the
relatively high level of productivity of cooperative production,
given that, according to the tenth evaluation, yield is higher for
cooperatives than for individual plots or for the so-called Special
Model of Individual Ownership (MEAI in Spanish). The latter,
created by the ARENA government to promote individual holdings in
the land reform sector, has become more widespread even though it
evidences lower levels of yield than cooperative forms of
production.
     The land reform sector is more efficient than the non-reformed
sector in the production of basic grains and, except for coffee, of
traditional export crops. In addition, land reform cooperatives
have shown themselves to be the most efficient form of production
within the land reform sector.

Recommendations

     The transfer of lands as a result of the peace accords appears
to be imminent, although we must wait for the results of inventory
verification in order to determine the total extent of the lands to
be transferred.
     If the FMLN's inventory is accepted, or only slightly
modified, the land area affected by the peace accords will be
considerable compared to the land affected by the 1980 reform. In
this context, we cannot underestimate the need to maximize the
benefits which could be obtained through the redistribution
process. A good measure would be to reorient available lines of
credit and open new agricultural credit lines on the basis of
promoting crops more profitable than coffee or cotton. At the same
time, it is crucial to adopt preferential credit policies for new
and small producers, something which does not seem all that
difficult to obtain considering the precedent set by the recently-
approved credit line for coffee.
     Finally, the current government's obsession with promoting
individual landholdings must be weighed against the figures
mentioned above. Considering that cooperative landholding has shown
itself to be more efficient in the majority of cases, the
government would be well-advised to promote cooperative landholding
among beneficiaries of the lands about to distributed, or at least
to desist from promoting individual landholding.


** End of text from cdp:reg.elsalvador **

/** reg.elsalvador: 148.0 **/
** Topic: Proceso 525: Peace Accords **
** Written  9:35 pm  Aug 20, 1992 by [e-mail] in cdp:reg.elsalvador **
From: [e-mail] (Centro de Informacion Documentacion y Apoyo a la Invest. - UCAJSC)
Subject: Proceso 525: Peace Accords

Center for Information, Documentation and Research Support (CIDAI)
Central American University (UCA)
San Salvador, El Salvador

PROCESO 525
August 12, 1992

PEACE ACCORDS:
Second rebel contingent fails to demobilize

     The peace process became seriously bogged down during the
second half of July. On July 31, the second contingent of rebel
forces was scheduled to demobilize, yet did not do so. This was
fundamentally due to the fact that the revised calendar of the
peace process, so arduously negotiated throughout May and early
June, once again suffered setbacks, leading the FMLN to conclude
that conditions did not permit the disarming of the second 20% of
its combatants. The delays consisted mainly of the government's
failure to carry out its much-vaunted plans to provide economic and
social assistance to make it easier for the demobilized contingents
to rejoin civil society; stonewalling around the transfer of lands
to ex-combatants on both sides; obstacles raised by members of
ARENA which have prevented the legalization of the FMLN as a
political party; and difficulties faced in beginning the work of
the Academy of Public Security and, with it, the National Civilian
Police.
     Early on, the FMLN warned of the seriousness of these
problems. On July 21, Commander Shafick Handal stated: "There are
a series of accords which have been delayed, and others that are
not being carried out properly... this only foretells a worse
crisis than the one we faced in April and May."
     The government's response was a rhetorical denial that a new
impasse in the peace process was imminent, and it raised the
confrontational tone of its public statements. Finally, however, to
avoid contradicting even ONUSAL's evaluation of the situation, the
Cristiani administration ended up acknowledging the existence of
serious delays in the execution of government commitments, but it
justified them by saying that international aid had yet to arrive.
The Minister of the Presidency, Oscar Santamaria, said on July 31:
"we do not consider the peace process to be in crisis. There are
difficulties, as ONUSAL says. But we have said that we hope to
overcome those difficulties in the near future." Santamaria added
that "the obstacles we meet along the way must not be used as a
pretext to fail to comply with the peace accords... non-compliance
by one side does not justify non-compliance by the other." With
this, the government tried to write off the FMLN's response to the
difficulties in the peace process as simple bad faith, conveniently
ignoring the fact that complying with the peace accords requires
reciprocity. This is obviously the best guarantee for the prospects
of democratizing Salvadoran society.
     During the last days of July, marathon working sessions were
held once again between government and FMLN representatives, with
ONUSAL mediation. Even so, no short-term solutions to the crisis
could be reached. In fact, the way things are going, there is an
urgent need for another direct intervention on the part of the
Secretary General Adjunct for U.N. Peacekeeping Operations, Marrack
Goulding, whose arrival in mid-August has already been announced.
Thus, at the end of July, the only area in which progress had been
made was in legalizing the FMLN, and this was effected in the
Legislative Assembly amid heated debates.

Chief sticking points

     In truth, above and beyond the natural difficulties which have
arisen in executing the accords, apparently the government is once
again stonewalling. At least this is the perception of top FMLN
leaders. "We believe that the [government's] declarations evince
true delaying tactics, and aim to build up a cushion of alleged
incidents of non-compliance on the part of the FMLN in order to
justify its own non-compliance," said Commander Roberto Roca on
July 27.
     The fate of the measures to be taken to legalize the FMLN's
open participation in civil society provide a good example of these
delays. From July 14 to 30, the majority ARENA contingent in the
Legislative Assembly managed to bar any plenary votes on reforms to
the Electoral Code -written by COPAZ and revised by the Assembly's
Political Commission- which would speed up the process of declaring
the FMLN a political party.
     ARENA's decision to block the reforms was initially aimed at
conditioning the legalization of the FMLN on a solution to the
problem of mayors in Morazan and La Union, who continue to function
in exile. FMLN leader Miguel Saenz declared that the government had
"maliciously" proposed, in an "indirect fashion," that "the
legalization of the FMLN depended on a solution to the problem of
the mayors." Once the maneuvering became evident, however, the
Legislative Assembly finally passed transitory measures to permit
the registration of the FMLN as a political party within 100 days.
     The issue of sending FMLN combatants back to civilian life is
even more complex and problematic. According to the government,
almost $95 million has been made available to begin short- and
medium-term assistance programs. There is also an emergency plan
aimed at facilitating documentation, household goods, agricultural
tools, and other items. In practice, the government has only
implemented the documentation aspect. This has motivated the return
of many of those who demobilized in the first contingent to their
former rebel camps. Mauricio Chavez, a member of the FMLN's
Reconstruction Committee, said on July 23 that about 7% of the
former combatants had returned to their former concentration points
for lack of assistance.
     The FMLN has issued vigorous protests against such government
non-compliance. "The programs of economic and social support for
demobilized combatants have not been resolved; the first 20%
received absolutely nothing; despite government propaganda that 750
million colones were available, they have received nothing," said
Commander Handal. On July 27, the FMLN's Reconstruction Commission
made public a new package of proposed assistance programs for
demobilized combatants. The proposal contained contingency
programs, as well as economic aid, adult education, housing,
rehabilitation for war disabled, and pensions for war disabled as
well as for families of those killed in combat.
     The outlook is less pessimistic for transferring lands to ex-
combatants on both sides. The Presidential Agrarian Commissioner,
Jaime Mauricio Salazar Diaz, announced that verifying government-
held lands would begin during the last week in July in order to
speed up the process of relocating demobilized FMLN combatants and
government soldiers. The official announced that 175 properties
belonging to a series of government agencies would be verified, for
a total of almost 150,000 acres; he also stressed that demobilized
combatants on both sides would get first choice of lands once
verification was completed. However, not a single plot of land has
been transferred to date, and no true progress has been made.
     With regard to the constitution of the National Civilian
Police, a number of aspects have been delayed, but the one which
most concerns the FMLN is the beginning of police training at the
Academy of Public Security. According to the rescheduled calendar,
the Academy should have begun classes no later than July 15.
However, the government has announced that training would not begin
until early September. In practical terms, this means that the
first contingent of the new police force will not begin work until
March 1993. The FMLN has stated its reluctance to dismantle its
military structures as long as the new public security system is
incapable of truly guaranteeing protection for civil society.

Outlook

     The FMLN has made it clear that it will not disarm until the
transformations in Salvadoran society laid out in the peace accords
have become irreversible. In the short term, the way things are
going, this means that it will be extremely difficult to dismantle
the entire FMLN structure by October 31. On this point, Commander
Joaquin Villalobos commented, "compliance with the nine months of
cease-fire depends on the government. If that context is not
created [of compliance with the accords] we will take no steps."
Roca, in turn, stressed that "we will not let these incidents of
non-compliance just go by; the government is answerable to the
nation for what it has signed."
     Naturally, as ONUSAL head Iqbal Riza stated, the October 31
date is not at all a "fatal deadline," as the government insists.
If anything can endanger the cease-fire, which has not been
violated to date, it is the Armed Forces' tricks and maneuvers to
resist cleaning out its ranks, and the problems arising from
slightly restructuring the prevailing unjust model of land
ownership.
     In sum, it is foreseeable that the current impasse in the
peace process can be resolved through the mechanism of the Joint
Working Group made up of the government, the FMLN and ONUSAL,
Furthermore, the imminent arrival of Marrack Goulding will
undoubtedly help achieve this goal in the short term.


** End of text from cdp:reg.elsalvador **

/** reg.elsalvador: 149.0 **/
** Topic: Proceso 525: Human Rights **
** Written  9:36 pm  Aug 20, 1992 by [e-mail] in cdp:reg.elsalvador **
From: [e-mail] (Centro de Informacion Documentacion y Apoyo a la Invest. - UCAJSC)
Subject: Proceso 525: Human Rights

Center for Information, Documentation and Research Support (CIDAI)
Central American University (UCA)
San Salvador, El Salvador

PROCESO 525
August 12, 1992

IDHUCA REPORT:
Respect for human rights is mandatory in El Salvador

     We are once again playing host to Marrack Goulding, U.N.
Secretary General Adjunct for Peacekeeping Operations. It is
extremely unfortunate that, for a second time, the point of his
visit is to get the bogged-down peace accords back on track,
instead of simply monitoring successful compliance. During his
visit, the U.N. official must have noticed the fact that -just as
during the war and the negotiations, which lasted until last
December 31- the majority of Salvadorans, mired in their daily
problems, have only been able to stand by and watch accusations fly
back and forth between the government and the FMLN.
     One of the most outstanding daily anxieties suffered by
Salvadorans has undoubtedly been their feeling of insecurity. "All
persons have the right to life, to liberty and to personal
security," says Article 3 of the Universal Declaration of Human
Rights. "Every individual has the right to freedom and personal
security," says the International Pact of Civil and Political
Rights. The Salvadoran State is a signatory to these and other
international instruments, yet in El Salvador, life and personal
security continue to be nothing more than mere aspirations, rights
which continue to clamor urgently for their intransigent defense.
     Just as in previous months, acts of violence during the first
half of August, including assassinations and various types of
attacks, have been many in number. Deaths have averaged almost two
per day. Those responsible for these deaths are either unknown
persons or ones whose modus operandi is identical to the
unforgettable "death squads."
     The bloodshed, ever-present in Salvadoran daily life, produced
two victims in August whose cases were amply covered by the
national press: the murder of Ivan Ramirez, a member of FENASTRAS;
and serious injuries to Jose Eduardo Pineda Valenzuela, former
official of the Attorney General's Office and currently member of
the Public Defender's Office for Human Rights.
     However, these were not the only cases. This period also
witnessed the murder of three engineers -Leonel Orlando Arevalo,
Jaime Mejia and Lorenzo Ayala Medrano- whose bodies turned up in
Intipuca (La Union); FMLN denunciations of another attempted murder
of one of its members; the death of an FMLN member and trade
unionist belonging to the Association of Public Works Employees,
Jose Alejandro Jaco Perez; and the murder of a number of National
Police officers and night watchmen, some on active duty. The list
of victims of violence for the first 13 days of the month totaled
25 deaths under troubling circumstances.
     These incidents do nothing to help bring peace to El Salvador.
In today's social context, they remain common denominators, along
with intimidation, psychological terror and impunity.
     In the midst of these problems, the Truth Commission opened
its doors last Monday to receive denunciations of acts of violence
which deeply moved Salvadoran society during the previous 12 years.
This commission, a product of the peace accords, is requesting
citizen cooperation and has made it clear that it will accept both
oral and written testimony regarding these painful incidents, while
maintaining absolute confidentiality for the cases and those who
denounce them.
     The efforts being made by the members of the Truth Commission
to clarify some of the events which weigh so heavily on the
conscience of Salvadorans are truly important. All of us must
collaborate. Even more, we must take into account incidents such as
the ones which occurred this month as well. The goal of searching
through the past is to abolish the structures of violence which
continue to act in El Salvador.
     But whether or not we choose to acknowledge it, many of us are
not prepared for peace and reconciliation. It appears that some
sectors, comfortably or conveniently entrenched in attitudes of
violent confrontation, refuse to get in step with history. For
example, a paid advertisement in El Mundo under the title of
"SALVADORANS:" and appealing to false nationalism, asked the
question: "Do the officers of the Armed Forces realize that the Ad
Hoc and Truth Commissions have been structured to destroy the Armed
Forces?". And the ad continued in its "patriotic appeal": "Always
remember that the Chapultepec accords are not legally valid since
they are not laws of the Republic." The ad was signed by the "Free
El Salvador Civic Movement."
     If, from the perspective of human rights, we carefully examine
the process currently underway in El Salvador, with the mediating,
moderating and monitoring presence of the United Nations, we must
ask ourselves if the country is being subjected -passively as well
as by force- to group therapy on the part of a foreign body which
aims to reorganize a national life which has been so badly
mistreated by the systematic and generalized violation of human
dignity. If the answer is yes, it would be valid to say that we are
suffering foreign interference in our internal affairs, that our
national sovereignty is under attack, and that we ought to invoke
the badly manipulated principle of "non-intervention." However, it
is not like that at all.
     According to Ignacio Ellacuria, human rights "must be rights
for all of humanity, or they truly cease being human." In other
words, if a human right lacks a humanitarian dimension, it is
neither human nor a right. By humanitarian dimension we do not only
mean the universality of human rights; in other words, its abstract
validity with regard to any human being. The true and historical
human rights of any person in particular have a humanitarian scope,
since they presuppose a legal interest in all of humanity as a
collective whole. Abstract universality must be accompanied by what
we might call the "universal gravitation" of rights. The exercise
and enjoyment of a human rights by a particular person, as well as
its violation, truly and historically affects that "universal
gravitation." The enjoyment of a human right by a particular person
is only full when it is equally enjoyed by all members of the
community. In the same fashion, the violation of a human right of
a particular person implies a threat of violation, a reduction in
personal security, and diminished enjoyment of this right on the
part of all other members of humanity.
     Therefore, the Universal Declaration of Human Rights is
extremely coherent when, in Article 28, it acknowledges that "all
persons have the right to the establishment of a social and
international order in which the rights and freedoms proclaimed in
this declaration become fully effective." Thus it is impossible to
imagine the human rights of a particular person in static form, as
if they were passive faculties extrinsically recognized by
humanity, but rather they must be imagined dynamically, as a
principle which configures a truly humanitarian social and
international order.
     From this point of view, the presence of the United Nations in
our country does not constitute foreign interference. And this is
not only because the two sides -government and FMLN- have requested
its cooperation, but rather because its presence represents the
presence and concern of all of humanity, of the community of
nations. It is not the intervention of a foreign power which, if it
were to occur, must be repelled. Nor is it the solicitous gesture
of a community of nations rushing to adjust the imperfections of
some small country somewhere in the world. In reality, that small
country has decided -and here is where we find the greatness of a
process which must be taken advantage of- to actively solve its
problems which, although domestic, have a universal humanitarian
scope and dimension. The U.N. presence is therefore obligatory and
natural, because the "universal gravitation" of human rights means
that one nation's internal problems inevitably affect all of
humanity.
     In El Salvador, where the political process is being mediated,
moderated and monitored by the United Nations, not only is a
precedent of innovative intervention being set by the U.N., but we
are also seeing the beginnings of a model of universal cooperation.
This is because our country is not acting simply as the passive
political object of U.N. intervention, but rather as an active and
dynamic subject. In this sense, we are not simply trying to solve
our internal problems, but rather we have the opportunity to make
a contribution to humanity of yet immeasurable consequences. We
might even be so bold as to venture that with this unprecedented
and innovative intervention in El Salvador, the United Nations
could reawaken hope worldwide in the organization, and historically
justify its existence.
     In his Sunday homily on August 9, the General Vicar of the
Archdiocese of San Salvador, Mons. Ricardo Urioste, was clear in
his denunciation. "We just don't get tired of killing in this
country," he said. "There are some who do not understand, and there
is no way to get them to understand, that human beings are sacred
and their lives must be respected." This same plea was made by
Mons. Romero over 12 years ago. Those groups -whether they are
called civic movements, anti-Communist fronts, etc.- which still
operate with impunity against human life, must understand that El
Salvador's present historical commitment also has universal
transcendence. As long as the voices which appeal for respect for
life go unheeded, peace in El Salvador will remain in jeopardy and
we will continue in debt to all of humanity.


** End of text from cdp:reg.elsalvador **

/** reg.elsalvador: 150.0 **/
** Topic: Proceso 525: Labor **
** Written  9:36 pm  Aug 20, 1992 by [e-mail] in cdp:reg.elsalvador **
From: [e-mail] (Centro de Informacion Documentacion y Apoyo a la Invest. - UCAJSC)
Subject: Proceso 525: Labor

Center for Information, Documentation and Research Support (CIDAI)
Central American University (UCA)
San Salvador, El Salvador

PROCESO 525
August 12, 1992

LABOR:
The VAT: a new challenge for the popular movement

     Last July 23, the Legislative Assembly, with the votes of PCN
and ARENA, passed the law to create a Value-Added Tax (VAT). The
tax will take effect on September 1 with a rate of 10%. Many
sectors opposed the tax from the moment the Ministry of the
Treasury announced it would send the bill to the Assembly last May.
Some opposition parties declared they would vote against the
measure.
     The popular movement, for its part, carried out some actions
to demonstrate its opposition to the tax. On June 3, the Permanent
Commission of the National Debate for Peace (CPDN) requested that
the tax not go into effect; on the 10th the UNTS ran a caravan
through downtown San Salvador to protest the VAT; on July 9,
CONFRAS joined the protests. However, during the period in which
the VAT was under debate, it cannot be said that the popular
movement actually adopted a strategy of struggle. The most
important joint action taken was the general work stoppage of
public employees on July 13 and 14, but the goal of the action was
more to pressure the private sector to join the Forum for Economic
and Social Consensus-Building than to oppose the VAT, even though
this was one of the points that the Forum should have taken up.
     It was only after the tax was passed that the popular movement
began to have an important presence in anti-VAT protests. On July
28, the Consumer Defense Committee announced that the VAT would
cause greater poverty, that the Ministry of the Treasury did not
have enough staff to oversee compliance with the tax, and that
therefore it should not go into effect until January 1993. The
Community Coordinating Council made similar declarations the same
day, adding that Salvadorans are not prepared to absorb such an
increase in the cost of living. On July 29 and 30, the CPDN and
UNTS, respectively, asked President Cristiani to veto the law. The
UNTS said it could accept the VAT only under the following
conditions: a 7% rate starting in January 1993, along with
ratification of the Consumer Protection Law without President
Cristiani's observations, a longer list of tax-exempt products, and
wage increases for workers. It also warned of future protest
actions if the law went into effect as passed by the Assembly.
     Later, on August 8, Ramon Diaz Bach of the CPDN complained
that the VAT was already being applied to some products by
unscrupulous merchants. He also claimed that the cost of living
would go up by 20% as a consequence of the tax.
     Although the popular movement has achieved a more or less
common position around the VAT, it is unlikely that its demands
will be heeded, especially with regard to the request that
President Cristiani veto the bill passed by the Assembly. In the
first place, the protests came far too late. On July 9 Cristiani
declared that no organization had presented a technically-qualified
document to support the claim that the proposed 12% rate was too
high; indeed, during the period between the announcement of the
bill and its passing in the Assembly, only a few isolated trade
union declarations were registered. Although almost all platforms
of labor demands mentioned the negative effects of the future VAT
on the standard of living of the majority, this does not mean that
a struggle to prevent the tax was being waged. The popular movement
spent those months busy chiefly with the teachers' strike and the
general work stoppage, not with the VAT.
     In the second place, the VAT is already a given, whether it
goes into effect in September or next January, and whether the rate
is 10% or 7%. Furthermore, the tax enjoyed sufficient consensus in
principle to avoid a boycott. The alternative now is perhaps in
demanding compensatory measures. One of them could be to demand
that the Consumer Protection Law be ratified with its original
language, excluding the presidential recommendations.
     The popular movement has also failed to come up with a joint
strategy for the consumer struggle. Although the Consumer Defense
Committee did a good job of drawing up and promoting the bill,
which was reflected in the general satisfaction with the language
of the bill as passed unanimously by the Assembly, the other
grassroots organizations have done little to pressure the Assembly
to override the president's recommendations [which seriously alter
the spirit and letter of the bill, cf. Proceso 523]. Popular
movement pressure remains at the level of isolated declarations. In
fact, the opposition parties have taken the lead in opposing
President Cristiani's recommendations.
     These parties are also opposed to the form in which the VAT
bill was passed. This could be an important factor to consider in
building future alliances. On August 8, the Democratic Convergence
announced that it would request the tax be postponed until January
1993 and with a rate of 7%. It also said that the version passed by
the Assembly has serious technical flaws which require time to
correct, among them a complete lack of mechanisms for fiscal
oversight. The party also requested that the tax be established by
consensus among the different sectors of the nation.
     On August 9, the Christian Democratic Party (PDC) declared
that the Law's technical flaws will prompt a trickle-down effect
resulting in a total increase of 35-40% in the price of all goods.
The PDC also complained that the informal sector was not taken into
account, despite the fact that it produces half of all goods and
services nationwide; and that the Ministry lacks the staff
necessary to control the implementation of the tax. Thus the PDC is
also in favor of allowing for more time to correct these problems
before the tax actually takes effect.
     The VAT is a measure which should have been discussed in the
Forum for Economic and Social Consensus-Building. The government
itself could have come up with a better reaction to the Consumer
Protection Law if the Forum had been fully functional, since it
would have worked to obtain decisive popular support.
     Finally, it is important to stress that the present moment
requires that the popular movement update its lines of action. At
a time when the nation is facing issues in which the subsistence of
the majority is at stake, there is no room for short-term demands
or improvisation. The moment demands concerted, powerful and
effective action. The greatest challenge facing the popular
movement is to win socio-economic demands which improve the living
conditions of the Salvadoran people. And the most urgent agenda
point is to mitigate the effects of the upcoming VAT.


** End of text from cdp:reg.elsalvador **