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August 23, 2007

Peruvian labor unions skeptical that "deal" will have real impact

Last week, Inside U.S. Trade published an article (sorry, not linkable) on Peruvian labor unions expressing concern that the labor improvements to the Peru FTA mandated by the Deathstar Deal might be more mirage than reality. House Democratic leaders have conceded that the Peruvian government does not have to implement the necessary changes through legislation, but instead by "supreme decree" from President Alan García.

"[Labor union sources] said the commitment is limited because it does not change Peruvian labor laws through legislation, and because many of the problems regarding labor rights are related to a lack of capacity or political will for effective enforcement. For these reasons, one source said the decrees would only be a 'gesture' to the United States.

"These labor sources said real improvements in labor rights would be achieved by the completion of a new, consolidated general labor law. Negotiations on the law, conducted between employers, employees and the government for the past five years, stalled one month ago despite having finished about 90 percent of the substantive negotiations. One of the issues that remain unresolved involves the terms under which employees can be fired, sources said."

Also, just a few days ago, the Peruvian labor movement released a letter to the U.S. Congress (PDF, translated to English) expressing these concerns and explicitly asking members of Congress to vote "no" on the Peru FTA.

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