Plan Puebla-Panama: The Next Step in Corporate Globalization

Plan Puebla-Panama represents the next giant step in corporate-centered globalization: the fruits of NAFTA. Mexican President Vicente Fox, the principal salesman, touts it as his development vision for southern Mexico and Central America.

The ramifications will be felt as far away as the United States and the Pacific Rim.

PPP would encourage foreign investment in the region, strategically located between the Pacific and the Atlantic, by constructing a series of transportation and sweatshop corridors spanning the isthmus.

Fox wants to transplant the maquiladora, production-for-export model that has been applied with disastrous results in northern Mexico, but with a few new twists. The isthmus is one of the most bio-diverse regions on the planet, and contains some of the most important fresh water reserves in the hemisphere. Exploitation of these resources is key to the plan.


The 63 million people of the region, including thousands of indigenous communities, have not been consulted. PPP is one more “development” plan, instituted by transnational corporations and international financial institutions, that will benefit the corporate bottom line but result in more poverty and displacement.

The American isthmus, the narrowest part of the Americas, includes nine southern Mexican states (Puebla, Veracruz, Oaxaca, Chiapas, Guerrero, Tabasco, Campeche, Yucatan, and Quintana Roo) and the seven countries of Central America (see map-page 14). The area has iron, titanium, petroleum, high quality soil, fresh water, and a high level of biodiversity, representing 10 percent of the world’s flora.

Twenty-first century commodities (such as computer chips, small motors, auto parts) are increasingly produced in the Pacific Rim, with China’s 1.2 billion people leading the way with the largest and lowest-paid workforce in the world. But transportation becomes a problem when the most important consumer bases, along the U.S. Atlantic Coast and in the upper Midwest, are located half-way around the world.

It’s much cheaper to ship these goods unassembled, using modern containerized shipping, but they still have to be assembled into finished products before reaching market. Thus the American isthmus offers unique strategic advantages as the shortest land route between the Pacific and the Atlantic.


All that remains is to convince the native population to give up their land for high-speed railway lines and toll highways, and to take low-wage jobs in the sweatshops that would produce the finished products.

In addition to east-west transportation corridors across the isthmus, PPP also contemplates pipelines and electrical grids spanning from north to south, for transportation of oil from northern South America and hydroelectric power from the isthmus, both destined for the U.S. market.

South America, particularly the Pacific coast, is an important source of agricultural products and minerals, and the isthmus is the natural transportation link. The Panama Canal often has waiting times of up to eight days, and corporations predict the need for the equivalent of six Panama canals across the isthmus by mid-century, largely “dry canals” where containers are taken directly from ships and moved across the isthmus on high-speed railways and toll highways.

Fresh water and biodiversity will be to the mid-21st century what oil is today-the most strategically important resources in the world. Genes from plants found in the isthmus are a key source of raw material for the pharmaceutical industry, and many future commercial uses that require biodiversity are only now in their development stages.

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To mention only one, researchers are experimenting with as many as 16 switches in biological raw material that could someday replace the simple on-off, two-switch system used in computers. Fresh water is becoming the most important natural resource. Nearly three-quarters of the world’s population will not have access to regular fresh water in the coming decade, and bottled water already costs much more than gasoline. The isthmus region is the third most important source of fresh water in this hemisphere, after the Great Lakes and the Amazon River basin. U.S.-based corporations are anxious to get their hands on these natural resources in the context of political stability (meaning: a pacified population) and enforceable trade laws that recognize international ownership of property (the Free Trade Area of the Americas).


Of course, this level of industrial development produces waste, and the isthmus would likely become a dumping ground, destroying large parts of the environment. Corporations have predicted this unfortunate consequence and, along with some of the more conservative conservation groups, are developing the concept of “environmental corridors,” where people would be prohibited or limited, including native populations.

Already we’re seeing industrial-scale plantations of eucalyptus, African palm, and shrimp farms, all of which damage the environment and produce only for export rather than for local consumption.


President Fox presents PPP as a plan for economic development, but the question is, development for whom? PPP would create a strategic economic zone for the globalized capitalist system. It represents a giant step in the process of expanding NAFTA to the rest of the hemisphere, by solidifying conditions for the proposed Free Trade Area of the Americas.

Winners: Multinational corporations. They would get abundant natural resources, with no trade restrictions, low taxes, and lax environmental standards. The Inter-American Development Bank, the World Bank, and the International Monetary Fund would provide the start-up capital.

A critical component of the plan is, of course, the absence of unions. PPP would provide these companies with a very low-wage workforce-lower even than in the maquiladoras of northern Mexico-allowing the isthmus to compete with China for sweatshop manufacturing.

Secretary of State Colin Powell has told Vicente Fox that the U.S. will support the plan if Fox militarizes the Mexico-Guatemala border to prevent immigration from Central America northward. This would please those who want to limit immigration to the U.S.

Losers: Small farmers, indigenous communities, and workers in the isthmus and elsewhere. Besides environmental disaster, local residents would face displacement from their traditional communities. Those who could not find local sweatshop jobs would then be forced to migrate to cities or, despite the border guards, to the U.S.

Either way, the worldwide race to the bottom is accelerated, as more and more people compete for limited industrial jobs.

In close consultation with sister organizations in the isthmus, a U.S.-based coalition to oppose PPP and support community-based development is in formation. Contact the Mexico Solidarity Network at 773/583-7728,

. For Spanish version of this article, click here.