NAFTA Environmental Watchdog Has Money Woes

by Diego Cevallos

The three-nation agreement is undergoing an evaluation in which independent experts and civil society groups will define its future. Although the results will not be known until mid-2004, there are already those who give it low marks and make gloomy predictions.

The NAAEC and its executive arm, the Commission for Environmental Cooperation (CEC), are cited as examples that could serve trade talks under way to set up the Free Trade Area of the Americas -- but the environment is an issue notably absent.

Those who want to benefit from the North American region's experience "may do so, and that includes the trade negotiators" from other parts of the world, CEC executive director William Kennedy told Tierramˇrica.

The environmental accord -- established in parallel to the North American Free Trade Agreement (NAFTA) involving Canada, Mexico and the United States -- has accumulated a mixed history of positives and negatives over the past decade.

The CEC claims as achievements the many studies and initiatives for measuring the environmental impacts of trade, which, according to different reports, range from moderate to what some consider nearly catastrophic.

The available studies, many conducted by the CEC, indicate that the intense flow of goods among the three NAFTA members has, for example, aggravated air quality problems and driven up the accumulation of toxic waste.

Trade has also contributed to the decline of agriculture in Mexico, where the once notable production of maize, or corn, has been contaminated by the genetically modified seed exported by the United States.

According to official figures, a thousand Mexican rural people move to the cities each day, the result of their inability to compete with U.S. agribusiness in the NAFTA context.

The mission of the CEC is to prevent potential environmental conflicts arising from trade relations and to monitor compliance with the NAAEC. But it is suffering financial problems that cast its future into doubt.

While annual trade amongst Mexico, Canada and the United States has risen since 1993 to more than $620 billion by 2002, the CEC's budget remains unchanged at nine million dollars, financed equally by its three members.

The NAAEC will be what they want it to be, says Kennedy, while confirming that the commission's budget is really on the decline as a result of inflation and the depreciation of the dollar.

In real terms, the CEC budget for 2004 will be some 2.2 million dollars less than in 203. "That means we will have to tighten our belts and monitor spending in order to be effective," said the executive director.

Furthermore, its action record includes just 42 citizen reports of violations of the regional treaty's environmental rules and none from the three governments.

Gustavo Alanis, current chair of the joint public consultative committee that supports the CEC, believes the environmental accord and its executive arm need to assume a position of strength in order to achieve greater impact, and thus win more financial support from Mexico City, Ottawa and Washington.

"It must be recognized that NAFTA's parallel environmental agreements are little known in the three countries, which has prevented them from being utilised as they should be," he said.

The NAAEC and the CEC "have not been able to contain the environmental damages caused by increased trade and the interests of big corporations," says Alejandro Calvillo, head of Greenpeace-Mexico, which set up shop in 1993 in order to keep an eye on the potential impacts of regional free trade.

But these instruments "are better than nothing, because they hold some political weight," Calvillo said.

"We are worried about the CEC's future, because in addition to financial troubles, it is under a lot of pressure from governments, especially from Washington, which wants to further cut its funding and its power," he said.

"There is absolutely no pressure" on the CEC, responds Kennedy. "We have three equal partners that contribute equally."

Despite it all, the CEC has its strong points. "It is a cutting-edge instrument in the international sphere," and should be promoted more, says consultative committee leader Alanis. "Its focus is on transparency and citizen participation."

The North American environmental accord allows individuals and groups to file denunciations with the CEC against their governments for failure to comply with environmental regulations. The process can lead to a report on the facts, which tend to be critical, but which do not involve sanctions.

The 42 claims filed to date cover issues related to biodiversity, unregulated logging, contamination of water supplies, storage of toxic waste and the construction of environmentally harmful mega-projects, among others.

But perhaps that is little to show for one decade of operations. "We hope in the coming years to be more effective in our contact with the public," says Kennedy.

So far, just nine of the claims have been finalised and made public, though three more are slated for dissemination in the near future, according to the CEC executive director.

The rest of the cases, most of which were filed by organisations or people from Mexico, have been set aside due to failure to meet the formal requirements or because of decisions by the NAFTA members.

One of the NAAEC's provisions that has come under fire from environmental activists allows the accused governments to state that certain denunciations will not be processed or that the results of investigations will not be made public.

Furthermore, the party filing the claim does not have the right to respond to the arguments used by the accused to defend itself from the charges.

Greenpeace director Calvillo hopes that the CEC "demonstrates what little remains of its strength" when it issues the report on the effects of trade in genetically modified maize from the United States, sold throughout the region under NAFTA's protection.

The environmental watchdog wants the final report, which could be released in March, to include a recommendation to halt sales of transgenic crops. The prospects for such an extreme measure are uncertain.

"We recommend that in the future the North American Agreement on Environmental Cooperation undergo reforms to be more effective, so that its position at the cutting edge is translated into an example of effectiveness," says Alanis.