The US will apparently relent on a condition which was holding up the signing of the next round of Millennium Challenge compact funding for El Salvador. The US had reportedly been insisting that El Salvador open up a seed purchase program to a Monsanto subsidiary, rather than keeping the program limited to purchases from local Salvadoran farmers and seed producers. This round of funding from the US would be a five-year, $277 million compact, focused on projects in southern El Salvador along the Pacific coast.
The New York Times reports the change in US position:
MEXICO CITY — The United States and El Salvador said this week that they had settled their differences over compliance with the fine print of a trade agreement that threatened to hold up aid to the small Central American country, but the timing of the dispute has become an embarrassment for Washington.
The surge of Central American migrants to the United States over the last few months has been a stark reminder of the poverty and violence they face at home. To some, Washington’s haggling over a program to help poor farmers in El Salvador has looked tone-deaf.
At the heart of the dispute is the way the Salvadoran government buys corn and bean seeds for subsistence farmers. Washington had objected to moves that favored small, local seed producers on the grounds that they violated the Central American Free Trade Agreement.
But on Wednesday, after articles about the dispute appeared in the media and 16 members of the House of Representatives called on Secretary of State John Kerry not to use changes to the food program as a condition for aid, the United States Embassy in El Salvador said that the dispute had been resolved....
In 2012, the Salvadoran government excluded foreign seed companies from a program known as the Family Farming Plan in an effort to encourage local producers. A subsidiary of Monsanto, the world’s largest seed company, had been a major supplier.The dispute had shown a clear bias of US trade policy towards favoring multi-national companies like Monsanto in the name of "fair trade" -- even at the expense of policy initiatives like El Salvador's Family Agriculture Program which aimed to alleviate rural poverty and increase food security and food sovereignty in the country. Sometimes "buy local" serves important policy objectives such as strengthening local producers, providing local jobs, and lessening dependence on the wide swings of international markets. US trade policy, however, tends to reject all such "buy local" initiatives as protectionism closing off markets to competition and inflating prices.