Alliance for Responsible Trade

Background

The liberalization of trade and investment through the free trade agreements signed to date, especially the North American Free Trade Agreement, has had severe social and environmental impacts on peoples and workers. The peoples of the Americas aspire to an international economy based on different principles that prioritize the environment.

From an environmental perspective, the problems with classic trade and investment policy are that they: "externalize" (do not account for) environmental and social costs; they foster more intense energy use, especially of fossil fuels; and they lead to over-exploitation of natural resources and damage to biodiversity, all of which erode the underlying basis of the economy and society. Such policies intensify the expropriation of genetic resources, the destruction of natural ecosystems, environmental degradation in agricultural and urban areas, environmental deregulation, and the violation of the individual and collective civil rights of generations present and future. Therefore, we believe that an accord that is respectful of the environment cannot be achieved through the addition of environmental clauses to the dominant logic of trade agreements. In reality, an environmental perspective would bring profound changes in economic strategy as such and therefore also lead to new thinking about the rules that govern the world economy. Experience has demonstrated that true development that incorporates an environmental perspective is incompatible with leaving the economy to markets forces.

Environmental degradation has also had a disproportionate effect on people living in poverty, especially women, as they tend to live with the impact of polluted habitats and resources in places where there is little political will to improve those conditions. Supporters of neoliberal policies tend to view some dimensions of sustainability (such as food security, the protection and use of collective wisdom about and use of biodiversity, the sustainable use of ecosystems and the existence of fair and equitable ways of sharing the benefits of natural resources) as obstacles to international trade. Governments for the most part have rejected these ideals, yielding instead to international market pressures.

Trade and financial liberalization stimulate and favor the entry of large transnational corporations into our countries, companies that are dedicated, in general, to export activities based on the intensive utilization of natural resources and energy. Those activities are often stimulated by the use of public resources. This means that state resources, which should be directed to social investments, end up facilitating even more exports and consumption of natural resources by the wealthiest sectors of society, with prices therefore remaining artificially low in the international market. This is, therefore, a mechanism that stimulates both concentration of wealth and environmental degradation.

Guiding Principles

1. Any international negotiation or agreement on trade and investment should establish the preeminence of environmental agreements over trade and investment accords. Environment and sustainability should not be limited to a single area of economic-financial accords, but rather be addressed as an overarching dimension and perspective throughout any such agreements.

2. The quality of development should be a key priority. Governments should establish social and environmental limits to growth on the basis of environmental sustainability and social equity.

3. Countries have the legitimate right to impose social, labor and environmental performance requirements on domestic or foreign investment. The imposition of these requirements is a fundamental tool for ensuring that investments serve each country's social objectives.

4. International trade agreements and nation states should establish plans to gradually internalize the environmental and social costs arising from unsustainable production and consumption. The over-consumption of natural resources by the richest strata of the population is directly linked to the inability of the poorest sectors to access the essential resources needed to achieve decent standards of living. Over-consumption should therefore be combated with high taxes on superfluous consumption and other measures along these lines.

5. The environmental costs of trade should be shared according to the importance of the goods and services being traded, starting from the principle that the parties may have different responsibilities for achieving common goals of sustainability.

6. Governments should recognize that there is an existing ecological debt among nations. This has resulted from richer nations occupying an exaggerated environmental space, meaning that they utilize and exploit a share of the world's natural resources that is disproportionate to their population or territory.

7. Governments should establish strict timelines to end international trade in products that harm the environment. During the transition period, punitive tariffs should be imposed to discourage trade in such products and avoid their use.

8. Trade should be accompanied by incentives for the conservation of soil and natural resources and to reduce and move toward the elimination of chemicals that damage the environment. It should encourage sustainable development and production close to the site of consumption.

9. Environmental regulations should be governed by the precautionary principle (i.e., the principle that, when in doubt, the most environmentally cautious course of action should be taken), rather than risk assessment (which applies economic cost-benefit analysis to environmental resources).

10. National legislation should be adjusted to prevent international companies from benefiting from mechanisms by which social and environmental costs fail to be incorporated into the prices of their products.

11. Trade liberalization must not hinder countries' capacity to channel foreign investment toward those sectors that strengthen sustainable development.

12. Trade and investment liberalization must not hinder regulations and controls on companies and investors to ensure compliance with a country's sustainable development objectives. Countries should maintain their sovereignty in regard to restrictions on those investments that could aggravate social and environmental problems and their disproportionate impacts on the most vulnerable sectors of society, such as women and indigenous peoples.

13. Foreign companies and investors should be held to the highest environmental standards, and be required to share technologies that favor environmental protection and create jobs.

14. Fair trade practices and alternatives to the generation of pollutants that are environmentally acceptable should receive adequate budgets and investment for research, development and implementation.

Specific Objectives

Forests

The forests of the Americas are the home of numerous indigenous peoples and other traditional communities that obtain from them the means of their physical subsistence, while at the same time ensuring their cultural survival. In addition, many other peoples and rural inhabitants living in areas near forests acquire from them numerous goods and services that ensure their livelihoods. Forests are also repositories of most of the current land-based biodiversity in the hemisphere, and also fulfill essential environmental functions, as much in the local as global realms. Therefore, the risks of the free trade model on the region's forests and for those who depend on them must be carefully evaluated.

The experience and results of trade agreements in this hemisphere, especially NAFTA, as well as neoliberal policies in general, show that the standards of protection for forests have been weakened. Indiscriminate logging has seriously harmed the peoples who inhabit forests or those who depend on forests. Moreover, employment has been lost in the forest sector, and the exploitation of native forests without improvements to inefficient and destructive forest extraction systems has accelerated. Industrial forest plantations cannot be considered to be forests, since they lack the majority of their characteristic values and in general contribute to processes of deforestation.

Therefore, any international agreement in the Americas should:

1. Consider forests as varied and complex ecosystems. Their use should respect the balance of biotic and abiotic factors. In the Americas, forests are the home of many peoples - especially indigenous peoples - and therefore their territorial, social and cultural rights, their ways of life and civilization and the use of their natural resources should be ensured.

2. Prioritize forest conservation as a key objective of integration processes. Trade and investment agreements therefore should be subordinated to international environmental agreements and to national laws and policies on conservation of biodiversity and forests, including the environmental services that they provide.

3. Require that the design and implementation of territorial regulations that contribute to linking agrarian and forest policies incorporate the needs and priorities of local populations through the promotion of their active participation in decision-making.

4. Institute the design of suitable indicators that are objective and neutral to measure the impact of economic integration processes on this and other natural resources.

5. Eliminate environmental and agricultural subsidies that favor the indiscriminate use of forests. Instead, subsidies should be created for sustainable technologies and practices, especially with native species. It is imperative to remove subsidies for plantations and large- scale monoculture. Likewise, the substitution of native forests by plantations should be avoided, and species in danger of extinction should be protected.

6. Promote the certification of sustainable forest products, as well as incentives for production and trade in recycled forest products. Local certification processes under socioenvironmental criteria should be favored.

Biodiversity and Intellectual Property

Conservation of biodiversity has been the responsibility of thousands of communities that use and cultivate resources for subsistence rather than for profit. There is a direct relationship between cultural, natural and agricultural diversity; they support each other. The international exchange of the resources generated by biodiversity has historically been of benefit to many peoples, although those benefits have been distributed less equitably over the last few decades. Conservation, research and development of genetic resources ex-situ in public and private scientific centers, combined with intellectual property systems, has institutionalized the looting and monopolization of genetic resources.

The hemisphere currently faces enormous threats to its biodiversity due to pressure from international trade liberalization treaties and the actions of multinational corporations, supported by national or regional legislation that covers their activities.

These threats are, among other things, contributing to the plunder and overexploitation of resources, genetic and cultural erosion, the disappearance of species of flora and fauna and traditional agricultural varieties, the disruption of ecosystems, biological contamination with genetically modified organisms, multiple economic, social and cultural impacts on peasant, indigenous and other local populations with traditional lifestyles who have been displaced by force or by the destruction of their livelihoods.

In recent years some processes that result in increasingly negative impacts on natural as well as cultural diversity have intensified. Megaprojects of natural resource exploitation, including the energy and transportation infrastructure that go with them, have a direct negative physical impact. There are also more indirect processes that lead to very negative impacts. These are, notably, the accentuation of the privatization process starting with intellectual property laws, the introduction of genetically modified organisms, the looting and privatization of genetic resources and knowledge through "biopiracy," and the privatization - formal or de facto - of natural protected areas, depriving traditional populations of them and/or expelling them.

Taking these situations into account, the principles and objectives guiding any international agreement or regulation should serve to:

1. Reject the processes of privatization in all areas, particularly those related to natural resources and natural protected areas or those of great biological and ecosytemic interest, as well as the direct and indirect processes of privatization of education and research.

2. Reject and fight against intellectual property rules on life forms and the knowledge associated with them, along the lines defined in the chapter on intellectual property rights.

3. Recognize and protect the collective rights of local communities in the conservation, growth and cultivation of biodiversity, within the broader framework of defending indigenous and rural peoples' rights to land and resources and to continue their cultures and practice their forms of government. This implies the primacy of collective and community rights (which in many communities is the historic knowledge transmitted by women) over the provisions of any trade agreement or intellectual property instrument.

4. Explictly recognize the superior status of ILO Convention 169 over any agreement on trade, investment or intellectual property in order to ensure the inalienable right of peoples and traditional black and indigenous communities to full autonomy in decisions over their traditional habitats, natural resourrces, and the biodiversity associated with them, and the use and management of same, according to their cultural systems and traditional rights.

5. Based on ILO Convention 169, establish and/or affirm the right of local communities to prior consultation and to veto projects of exploitation or deprivation/privatization of resources, infrastructure or industrial projects that local communities consider to threaten their economic, social and cultural lifestyles.

6. Affirm that local and ethnic autonomy should not mean that communities can sell or privatize public or collective resources of nations or states, even when they are located within their territories.

7. Guarantee the free circulation of knowledge and access to genetic resources, particularly for research in the service of the needs of local communities and residents, as well as for public research centers.

8. Consequently, reject the implementation of so-called "bioprospecting" projects (i.e., prospecting for genetic resources for commercial application) since in practice they are biopiracy projects that make possible the appropriation of those resources and the traditional knowledge associated with them, so that they can be patented by agroindustry and pharmaceutical multinationals. Likewise, prevent those projects from being legitimized through laws on access to genetic resources that have only served to legalize this process of privatization of resources and to restrict the use of goods that have always been public, collective and subject to free exchange. Denounce and reject the so-called "benefit sharing" mechanism, which is to say, the payment of some minimal percentage of the profits obtained by companies when they commercialize those resources, which does not prevent privatization and unleashes processes of alienation and competition within and among communities or between communities and governments.

9. Any agreement on these issues should recognize and compensate communities that create and conserve biodiversity for the historical and current ecological debt owed them because of profits made by others through genetic resources and associated knowledge. This implies, among other things, recognition (and repatriation, when appropriate) by the countries that have appropriated genetic resources present in their gene banks, zoos and herbariums.

10. Reject the development, introduction and consumption of crops and other genetically modified organisms, since they imply a grave risk of biological contamination and of displacement of local varieties and species, with environmental, health and social impacts, among other things, due to the loss of control of seeds by peasants and farmers.

Sustainable energy sources

Sustainable energy development is predicated on respect for the right of communities, energy savings, and the fight against excessive energy consumption. Energy sources should be renewable, clean and low-impact. Access to those sources should be democratic and equitable.

In order to carry out this vision, it is clear that nation-states and local communities must control the development of energy sources and other natural resources. Unfortunately, the draft text of the FTAA includes various proposals similar to those in NAFTA that would make these controls difficult or impossible.

Specifically, the draft FTAA text includes measures that limit the use of export taxes, export quotas or minimum prices. In addition, it opens the door to one of the most dangerous articles in NAFTA, which requires countries to continue to export non-renewable natural resources even during periods of national scarcity. The chapter on competition policy includes provisions that would prohibit the establishment of "non-production" or other restrictions on the supply or demand of goods and services.

Energy integration should be a process that allows for the growth of potential and for cooperation among different countries, under equitable conditions that reflect each nation's economic, social and cultural characteristics.

Therefore, the following are proposed:

1. Redirect investment, loans and subsidies toward clean-energy projects and energy efficiency based on equity of access and national priorities, including sustainable transport; giving precedence to public over private, and democratic access to energy for residential, craft, business and industrial use.

2. Eliminate direct and indirect subsidies for fossil-fuel energy.

3. Eliminate direct and indirect subsidies for energy-intensive industrial activities such as the aluminum, steel and paper industries.

4. Develop a legislative and institutional basis for the promotion of sustainable energy production. This entails support for research and dissemination on clean energy.

5. Declare a moratorium on coal, natural gas and oil exploration in new areas as part of the transition to clean, renewable and low-environmental-impact energy sources.

6. Respect the right of communities in areas affected by energy production, especially indigenous communities.

7. Enforce the use of environmental impact studies for all energy-related projects. These studies should analyze forms of energy use reduction and should consider options that are clean, decentralized and of low impact. They should also consider the irreparable damage caused by displacement of local populations, as in the case of the construction of large dams.

8. Establish agreements that regulate the deposit and transport of energy products (such as oil and gas) in order to prevent risks and accidents. Promote international cooperation in cases of accidents, requiring those responsible to assume the social and environmental costs associated with those accidents.

9. Ensure citizen participation in decision-making on energy projects, particularly by affected communities, respecting their right to reject those projects that could have negative impacts for them.

Mining

Mining in the Americas has involved many decades of heavy metal pollution and the destruction of land and sea habitats, as well as threats to the health and safety of mine workers and their families, who often live near hazardous work-sites and suffer effects to their physical and reproductive health due to contact with such contamination. These conditions are present throughout the hemisphere and reflect inefficient public policies designed to control the environmental impact of this activity, as well as clearly predatory corporate behavior.

The accelerated expansion of mining carried out by international companies has not been accompanied by stronger controls, regulations or safeguards for human or environmental health. Instead, it has generated greater demand for the use of resources such as water and energy.

Therefore, the governments of the Americas should:

1. Guarantee that mining projects are approved in advance by the communities that will be affected, especially when those projects would have an impact on other production or soil use. The land rights of indigenous communities must be respected.

2. Accept and enforce the highest health and safety standards for workers and environmental protection as conditions for mining development.

3. Declare a moratorium on mining exploration and development in ecologically and culturally significant areas.

4. Establish priorities and incentives in mining aimed at reducing consumption and increasing the efficiency of mineral processing.

5. Revisit the recommendations presented by non-governmental groups at the Sustainable Development Summit held in Santa Cruz in December 1996.

Insecticides

The intensive use of chemical insecticides on monoculture agricultural export production creates serious public health problems, such as: frequent poisoning resulting from the use of extremely and highly toxic insecticides; the generation of chronic health problems such as birth defects, cancer, alterations of hormone systems, reproductive problems and effects on neurological systems. Children, women of reproductive age and indigenous migratory workers are the sectors that are at greatest risk.

Similarly, the intensive use of chemical insecticides threatens the biodiversity of agroecosystems and the region's environment due to the destruction of microflora and microfauna in the soil, the effects on beneficial insects, birds and other species of wildlife; the impacts of aerial spraying, contamination of subterranean water, leaching of contaminants from irrigation channels to rivers, lagoons and seas; in addition to causing resistance in insects, fungi and weeds.

The models of regulation and control of the pollution that results from insecticide use in the region have been ineffective due to the lack of enforcement of laws and standards, deficient monitoring and the lack of recognition of the public access to information on the use of insecticides and their impact on environmental and food quality. Therefore, the governments of the Americas must:

1. Harmonize standards and regulations relative to the registration, labeling and use of insecticides in order to raise the level of protection of workers exposed to them (especially the indigenous population, women and children), as well as consumers and the environment.

2. Reorient investment, loans and subsidies for the development of agroecological technologies to control pests that permit the elimination of the chemical insecticides with the greatest acute toxicity (Classification Ia and Ib of the World Health Organization) and those with chronic health effects on the population.

3. Recognize the rights of agricultural workers, communities and consumers to information on the site, use, volume and type of chemical insecticide used. This would permit active citizen participation in the design of programs to reduce and eliminate agrotoxics and to participate in oversight of environmental quality and trade in insecticides prohibited in the region.

4. Sign, ratify and effectively enforce prior informed consent (PIC) on trade in insecticides and especially dangerous formulations, as established in the Rotterdam Convention.

5. Develop national plans for the elimination of insecticides that cause destruction of the ozone layer and those that because of their persistence, bioaccumulation, toxicity and transport over long distances are included in the International Convention on Persistent Organic Contaminant and of residues from chlorinated insecticides used in the region.

Toxic substances and residues, solid and dangerous waste products

The generation of dangerous waste products creates a serious problem of environmental contamination and public health that threatens the sustainability of the Americas. In spite of that, industry has promoted a paradigm of evaluation and risk management of toxic substances rather than the prevention of exposure to them, and favored technologies to treat dangerous wastes at the end of the production process instead of proposing changes and evaluating alternatives to the intensive use of toxic chemical substances and dangerous materials. Transnational corporations seek to homogenize consumer needs, centralize production at the cost of employment and the environment, and encourage waste production and generation in order to augment profits.

Neoliberal policies of indiscriminate trade liberalization and incentives for foreign investment promote self-regulation of industry and lead to lower levels of control of trade in dangerous substances and materials, the relocation of polluting industries in the region, and the export of dirty technologies for the treatment of dangerous waste products. In the case of NAFTA, protections are also provided for foreign investors through compensatory measures that allow them to claim damages worth millions of dollars if they are affected by conservation or public health protection measures, alleging discriminatory or expropriation practices.

Therefore we demand that the governments of the Americas:

1. Incorporate the precautionary principle in the design and implementation of public policies on industrial development, environmental protection and public health in order to reduce the generation of dangerous waste products from productive processes through greater efficiency and better use of raw materials and supplies, substitution of especially dangerous materials and substances and the redesign of technological processes and products.

2. Harmonize procedures for national registration and inventory of emissions and transfer of pollutants so that they include the highest standards of protection, are obligatory, and recognize citizens' right to full access to information that permits the identification of volume, type of pollutant and the local emission sources.

3. Reorient investment, loans and subsidies to stimulate cooperation, technical assistance and financial projects that promote clean forms of production and treatment technologies that do not generate new pollutants.

4. Stop the transfer of dirty technologies for the treatment of dangerous waste products from developed countries and prevent reductions in control levels of trade in waste and so-called recyclables, and trade in dangerous substances and materials. In particular, prevent the expansion of incineration for the treatment of dangerous waste, hospital waste products, municipal waste products or their use as fuel in cement ovens.

5. Ratify the amendment to the Basel Convention that prohibits the export of dangerous waste products from OECD countries to non-OECD countries and establish mechanisms of monitoring and public vigilance.

6. Sign and ratify the Convention on Persistent Organic Contaminants and implement national plans for elimination with full citizen participation.