From iatp@iatp.org Mon Jul 13 11:35:41 1998 Date: Fri, 10 Jul 1998 22:04:13 -0500 From: iatp@iatp.org To: nafta-news@igc.apc.org Subject: NAFTA & Inter-American Trade Monitor Vol. 5, Number 14 [The following text is in the "iso-8859-1" character set] [Your display is set for the "US-ASCII" character set] [Some characters may be displayed incorrectly] ------------------------------------------------------------------------ NAFTA & Inter-American Trade Monitor - Vol. 5, Number 14 July 10, 1998 ------------------------------------------------------------------------ Table of Contents - NAFTA ENVIRONMENTAL ISSUES - FTAA & CIVIL SOCIETY INPUT - FAST TRACK - ON AGAIN, OFF AGAIN - U.S. FARMERS PROTEST LOW PRICES, SANCTIONS - FAO AGRICULTURE PRIORITIES SET - ILLEGAL CHICKEN, PORK EXPORTS ALLEGED - RESOURCES/EVENTS NAFTA ENVIRONMENTAL ISSUES NAFTA's Commission for Environmental Cooperation (CEC) met in Merida, Mexico in late June, handicapped by lack of a director since Victor Lichtinger's controversial resignation or firing in February. The three members of the CEC, U.S. Environmental Protection Agency Administrator Carol Browner, Mexican Environmental Secretary Julia Carabias, and Canadian Environment Minister Christine Stewart, are rumored to have opposed Lichtinger's alleged activist position on environmental issues. The CEC meeting resulted in a pledge to create better mechanisms for public input. All three NAFTA countries continue to struggle with environmental issues. Canadian government officials criticized Canada's environmental record in June. Brian Emmett, an independent federal commissioner for environmental protection monitoring, charged in his eight-chapter, four- volume report that Canada is failing to implement its environmental vision due to heavy industrial pollution and high use of fuel oil, natural gas and petroleum. Canada's Auditor General Denis Desautels warned that Canada will not be able to live up to its Montreal Protocol commitments on reducing greenhouse gas emissions, instead increasing those emissions by at least 11 percent by 2010. The House of Commons Standing Committee on Environment and Sustainable Development called for more effective enforcement of environmental laws, pointing to 30 percent cuts in the enforcement staff of Environment Canada between 1995 and 1997. In addition to cuts in prosecutions, water sampling stations on the Great Lakes have been cut by 80 percent and all water testing in acid rain-plagued lakes in northern Ontario was terminated last year. In Mexico, widespread forest fires contributed to declaration of an air quality emergency in Mexico City on May 25-29. During the state of emergency, more cars are kept off the streets and stricter emissions standards apply to taxis and mini-buses used for public transportation and to diesel-fueled cargo vehicles. About 600 companies are required to reduce production during emergency days. Some seven companies may be subject to penalties for alleged noncompliance with reductions during the emergency period. Critics said the government should have acted earlier to reduce emissions from traffic and industry during the continuing crisis. The Mexican fires have burned more than a million acres of forest and grassland, and were characterized as the most serious fires in the world by Brian Atwood, director of the U.S. Agency for International Development. Mexican environmentalists say that both the Mexican and U.S. governments have been slow to react to the fires. Environmental issues along the U.S.-Mexican border range from sewage treatment to hazardous nuclear waste disposal. NAFTA was supposed to provide money to address border air and water pollution, but no environmental project financed by NAFTA-related funds is operating yet. The North American Development Bank (NADBank) recently approved loans for construction of two sewage treatment systems in Ciudad Juarez and Tijuana, on the recommendation of the Border Environmental Cooperation Commission. Both Mexican and U.S. environmentalists oppose a plan to locate a low- level nuclear waste dump just 30 kilometers from the Mexican border in one of the poorest regions in Texas where about two-thirds of the residents are of Mexican origin. the dump would be located near Sierra Blanca, which already has the world's largest sewage sludge dump. The Mexican Congress's Permanent Commission voted unanimously against the nuclear waste dump earlier this year and some Mexican congressional deputies say the dump violates the 1983 La Paz Agreement between the two countries. Mexican officials say they will fight the dump by using NAFTA structures. In the United States, the nonprofit Environmental Working Group reported in May that U.S. children are eating more pesticides on fresh produce than ever before. The Environmental Working Group found trace mounts of between three and ten different pesticides after washing and peeling fresh produce, but the average pesticide level was below legal limits. The U.S. Environmental Protection Agency had announced in 1993 that it would promote the use of biological pest management rather than chemicals. The Environmental Working Group charged that the Clinton administration has "no plan to develop a plan for reducing pesticides in agricultural use." A study of children in Mexico who were exposed to pesticides used on crops there found decreased memory, ability to catch a ball, and eye- hand coordination. The study, conducted jointly by the University of Arizona and the Instituto Tecnológico de Sonora, Mexico, said many substances banned in the United States were found in the blood of those studied. Canada, Mexico and the United States all pledged to effectively enforce their own environmental laws and regulations under Article 5 of the environmental side accord to NAFTA. Mary Sutter, "NAFTA 'Green' Council Meets Amid Doubts About Its Role," JOURNAL OF COMMERCE, June 25, 1998; Mary Sutter, "NAFTA 'Green' Panel Renews Pledge on Input," JOURNAL OF COMMERCE, June 29, 1998; Mark Bourrie, "Canada Failing to Enforce Environmental Laws," INTERPRESS SERVICE, June 2, 1998; Barry Wilson, "Government Under Attack Over Environment Record," THE WESTERN PRODUCER, June 11, 1998; "Audit Reveals Nation Failing to Meet Domestic, International Environmental Pledges," INTERNATIONAL ENVIRONMENTAL REPORTER, June 10, 1998; "Inadequate Enforcement of Regulations on Environment Found by Government Panel," INTERNATIONAL ENVIRONMENTAL REPORTER, June 10, 1998; "Authorities Toughen Air Quality Standards After Five Days of High-Level Contamination," INTERNATIONAL ENVIRONMENTAL REPORTER, June 10, 1998; "Seven Companies May Face Penalties for Alleged Failure to Curb Emissions," INTERNATIONAL ENVIRONMENTAL REPORTER, June 10, 1998; Sam Dillon, "Rainy Season Starts, But Mexico Fires Roar On," NEW YORK TIMES, June 6, 1998; Danielle Knight, "Concern Over Border Nuclear Waste Dump," INTERPRESS SERVICE, June 24, 1998; "Heavy Exposure Linked to Decreases in Mexican Children's Neurological Ability," INTERNATIONAL ENVIRONMENTAL REPORTER, June 10, 1998; Julie Vorman, "U.S. Pesticide Residue Shows No Decline," May 21, 1998; Sam Howe Verhovek, "Pollution Puts People in Peril on the Border With Mexico," NEW YORK TIMES, July 4, 1998; Mary Sutter, "Scope of NAFTA 'Green' Agency Narrows," JOURNAL OF COMMERCE, June 30, 1998. FTAA & CIVIL SOCIETY INPUT Negotiators working on the Free Trade Agreement of the Americas have delayed decisions on interim agreements and early implementation of business facilitation measures for six months. The United States and business groups have pushed for early implementation of agreements, especially business facilitation measures, such as streamlined customs procedures, by the year 2000. Kathryn McCallion, the Canadian chair of the FTAA Negotiating Committee, said that no interim agreements were likely until the United States passes fast-track legislation. McCallion cited U.S. rigidity in its negotiating posture on agricultural policy as another barrier to early agreements, since Mercosur nations have responded by saying, "in that case, we will not reach fast agreement on an investment framework." Non-governmental organizations across the Americas fear that "governments won't give their concerns the same treatment as that granted to the interests of multinationals when it comes to negotiating accords on trade and investment," according to a letter submitted to Kathryn McCallion by some 20 NGOs. The NGOs expressed concern over the level of participation in the FTAA process that has been given to business forums. "We are not against the business community holding its own forums," said Atziri Ibañez of the U.S. National Wildlife Federation, but he asked that businesses present their input through the civil society processes set up by governments, just as other NGOs must do. "That is the only way for everyone to participate on an equal footing," said Ibañez. U.S. Representative Richard Gephardt also expressed reservations about the process for allowing input from civil society in a June 15 letter to U.S. Trade Representative Charlene Barshefsky, warning: "This Committee [for Civil Society] will isolate the trade ministers from direct public participation by flitering all comments from labor and non-governmental organizations (ngos). The business community because of its ability to muster greater resources than the ngos and labor will dominate the process. . . . Just because the U.S. has failed to achieve working parties on labor and environmental issues thus far, doesn't mean that we should give up on the objective." William New, "Hemispheric Officials Wrestle With Terms of FTAA Negotiation," INSIDE U.S. TRADE, June 26, 1998; "Food Exporters Form Free Trade Lobby Group," THE WESTERN PRODUCER, June 25, 1998; "U.S. Proposal for FTAA Civil Society," AMERICASTRADE, June 17, 1998; Marcela Valente, "Civil Society Fighting Hard for Inclusion in FTAA," INTERPRESS SERVICE, June 22, 1998; Kevin G. Hall & Beth Rubenstein, "Trade Ministers Give Clinton Time to Nail Fast Track," JOURNAL OF COMMERCE, June 23, 1998; Richard Gephardt, "Letter on Public Participation in FTAA Process," INSIDE U.S. TRADE, June 15, 1998. FAST TRACK - ON AGAIN, OFF AGAIN House Speaker Newt Gingrich (R-GA) announced at the end of June that he would schedule a September vote on legislation for fast-track negotiating authority. On July 6, President Bill Clinton said he would not support a fast-track debate and vote this fall. While reiterating his support for fast track, the president said that "if there is no reason [to] believe we can pass it, it would be a mistake" to bring fast-track legislation back before Congress at this time. Clinton said that instead of focusing on fast-track, he will ask Congress to pass an Africa trade bill and the Caribbean Basin Initiative. Trade negotiators from Brazil, Argentina and other Latin American countries have warned that fast-track authority must be in place by September 1999 in order to continue to move negotiations on the Free Trade Area of the Americas to completion by the scheduled completion date of 2005. Florida farmers pledged to fight against fast track in Florida and in other states where growers have been adversely affected by free trade, including California, Tennessee and Virginia. The AG for Fast Track coalition supported Gingrich's call for a vote this fall, saying that they could see "absolutely no down side," but said that the alternative would be a vote in spring of 1999. Neither Gingrich nor the AG for Fast Track coalition addressed the concerns of other farm groups over the crisis situation of farmers in the midwest, northwest and north central states as wheat prices and exports to Asia fall. Republican Senators insisted that the farm sector needs increased foreign trade to prosper, and that the 1996 free-market "Freedom to Farm" law is not in need of overhaul. "Clinton Indicates He Will Not Push for Fast Track This Year," CONGRESS DAILY, July 6, 1998; "Farm Industry Concedes It Faces Uphill Battle in Fight for Fast Track," INSIDE U.S. TRADE, July 3, 1998; Curt Anderson, "Senators: Foreign Trade Vital to Farming Sector," ASSOCIATED PRESS, June 22, 1996; Kevin G. Hall & Beth Rubenstein, "Trade Ministers Give Clinton Time to Nail Fast Track," JOURNAL OF COMMERCE, June 23, 1998; Ian Elliott, "FTAA Steams Ahead as APEC Sputters," FEEDSTUFFS, July 6, 1998. U.S. FARMERS PROTEST LOW PRICES, SANCTIONS The Montana Farmers Union called for increased grain prices in a rally at the Coutts, Alberta-Sweetgrass, Montana border port of entry in June. "We need the support of government and the people," said MFU president Ken Maki, blaming politics for the near-record-low grain prices. Montana winter wheat is now selling at $2.45 per bushel, and government loan prices are pegged at only $2.58. House Minority Leader Richard Gephardt (D-MO) and Senate Minority Leader Tom Daschle (D-SD) in March introduced legislation making changes in the 1996 farm bill to allow farmers to pay back loans at the loan rate or at the price that they actually receive for their crops, if that is lower than the loan rate. Maki blames the 1996 farm bill for many of the troubles of northern plains farmers. "Farmers here are really limited to winter wheat, spring wheat, barley and feed grains because it is so dry and such a short growing season," Maki explained. "Add to the condition, prevailing low grain prices and you have a situation that is putting these guys out of business." U.S. sanctions against India and Pakistan further concern wheat farmers, since the sanctions end export credit programs used by the two countries to purchase U.S. wheat. Wheat farmers fear that the sanctions will cause already-low wheat prices to drop even further. Speakers at the Montana Farmers Union rally said that trade sanctions against various countries cost U.S. farmers sales worth about $26 billion per year. Senator Richard Lugar (R-IN) said he will introduce legislation requiring Congress and the Administration to consult during formulation of sanctions policies and providing that all sanctions would expire after two years. President Clinton expressed sympathy for farmers, saying that, "Cutting off the supply (of U.S. wheat) will only hurt the citizens of Pakistan and American farmers, without furthering our goals of nonproliferation of nuclear weapons." Canadian agriculture officials responded to recent reports of a 23 percent decline in prairie farm income this year, following a 50 percent drop last year, and a negative net income for farmers in Saskatchewan last year by saying that cash income was at record levels, so the situation was not bad. Canadian Senate agriculture committee chair Len Gustafson said that the officials of Agriculture Canada painted too rosy a picture, ignoring real problems of Canadian farmers. Ric Swihart, "U.S. Farm Group Wants Grain Price Hike," THE WESTERN PRODUCER, June 25, 1998; "Farm Industry Concedes It Faces Uphill Battle in Fight for Fast Track," INSIDE U.S. TRADE, July 3, 1998; Barry Wilson, "Farm Economy Not That Bad, Says Agriculture Canada," THE WESTERN PRODUCER, June 18, 1998; Jerry Hagstrom, "Senate Action Concerns Wheat Producers," AGWEEK, June 15, 1998; "Farmers Take Anger to the Road," THE WESTERN PRODUCER, June 25, 1998; "Lugar Seeks to Add Sanctions Proposal to Farm Appropriations Bill," INSIDE U.S. TRADE, June 26, 1998; Jim Lobe, "Anti-Sanctions Campaign Gathers Steam," INTERPRESS SERVICE, June 29, 1998; William Roberts, "Sanctions Flexibility Sought," JOURNAL OF COMMERCE, June 23, 1998. FAO AGRICULTURE PRIORITIES SET The 25th regional conference of the U.N. Food and Agriculture Organization in Nassau, Bahamas in June called for rural development as the key to the fight against poverty, and for reforms of international agricultural trade. The 33 Latin American and Caribbean agriculture ministers in attendance also agreed on the importance of sustainable management of natural resources while seeking food security, and emphasized the importance of the code of Conduct for Responsible Fishing in the region. Gustavo Gonzalez, "FAO Conference Sets Priorities," INTERPRESS SERVICE, June 22, 1998. ILLEGAL CHICKEN, PORK EXPORTS ALLEGED Mexican chicken and hog producers allege illegal exports of U.S. fresh chicken parts and slaughter hogs, blaming both corrupt Mexican inspectors and U.S. producers. Mexican chicken producers say that customs officials fail to adequately inspect trailers carrying imports of fresh chicken parts. U.S. producers sell the more profitable chicken breasts in the United States, sending the legs south, where they can get a higher price from Mexican consumers than from U.S. consumers. Fresh or frozen chickens from the United States pay duties of 240 percent on entry to Mexico, but salted or smoked meats pay only 8 percent. Smugglers claim that their fresh or frozen chicken parts are "brine-chicken." Allegedly-processed chicken imports have risen from 450 tons to 9,000 tons per year since NAFTA's effective date. The Mexican Pork Producers Council claims that U.S. pork producers are dumping slaughter hogs on the Mexican market. The Council filed an anti- dumping petition with the International Commercial Practices Unit of Mexico's Secretariat of Commerce (SECOFI) at the beginning of June. At the World Pork Expo in Iowa at the beginning of June, University of Missouri agriculture economist Glenn Grimes told U.S. producers that they could expect a 40 percent increase in production during the next 18 months, taking the industry to a 137-million-head pig herd. Joel Millman, "Illegal U.S. Chickens Pour Into Mexico," WALL STREET JOURNAL, June 24, 1998; Ian Elliott, "Mexican Pork Producers Start Anti- dumping Action Against U.S.," FEEDSTUFFS, June 29, 1998. RESOURCES/EVENTS Regional Integration and Multilateral Cooperation in the Global Economy, edited by Jan Joost Teunissen. Forum on Debt and Development (FONDAD), The Hague: 1998. Collected papers presented at 1997 conference on regional integration and multilateral cooperation, including consideration of prospects and priorities for integration in Latin America, Africa, Asia, the Middle East, and Eastern Europe; the issue of regionalism versus multilateralism; and economic globalization. Order from FONDAD at Noordeinde 107 A, 2514 GE The Hague, the Netherlands; telephone 31-70-3653820; fax 31-70-3463939; email Forum_fondad@wxs.nl "Hazardous Waste Management on the Border: Problems With Practices and Oversight Continue," BORDERLINES, Vol. 6, Number 5, July 1998. Monthly publication of Interhemispheric Resource Center, Box 4506, Albuquerque, NM 87196-4506. Articles in this issue focus on hazardous waste issues on the border. ------------------------------------------------------------------------ NAFTA & Inter-American Trade Monitor is produced by the Institute for Agriculture and Trade Policy, Mark Ritchie, President. Edited by Mary C. Turck. Electronic mail versions are available free of charge for subscribers. For information about fax subscriptions contact: IATP, 2105 1st Ave. S., Minneapolis, MN 55404. Phone: 612-870-0453; fax: 612-870-4846; e-mail: iatp@iatp.org. The Spanish version of this news bulletin, El Monitor de NAFTA y Comercio Interamericano, and a searchable archive of all back issues is available at: http://www.sustain.org/bulletins. To unsubscribe to the email version of this news bulletin, send email to: Majordomo@igc.apc.org. Leave the subject blank. 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