Sunday, March 16, 2014

Report on NAFTA at 20 Shows How Environmental Destruction is not a Bug. It is a Feature.

On December 8, 1993, when Bill Clinton signed the North American Free Trade Act (NAFTA) into law, he spoke in glowing terms about its future effects:
I believe we have made a decision now that will permit us to create an economic order in the world that will promote more growth, more equality, better preservation of the environment, and a greater possibility of world peace.
A new report from a group of environmental and progressive groups from the US, Canada, and Mexico puts this promise of a new era of better environmental protection up against the reality of the twenty years of NAFTA, and it's not pretty. 
The groups involved were the Sierra Club, Sierra Club Canada, the Mexican Action Network on Free Trade, the Institute for Policy Studies, and the Council of Canadians.

The report looks at NAFTA’s effect on a number of sectors: agriculture, mining, manufacturing, and energy. I'll include some highlights below.


The NAFTA-induced growth of US agricultural exports to Mexico had environmentally damaging effects in both countries. The influx of U.S. crops like corn caused prices of such staples to plummet in Mexico. Since smallholders did not have the resources to shift from staple crops to cash crops, they either left their farms or attempted to offset falling prices by increasing production and clearing new land. Consequently, deforestation rates rose as much as 1.1 million hectares per year, exacerbating global warming and threatening biodiversity. About one-fourth of this US corn flooding into Mexico is genetically modified, and US-created GM corn has already begun to contaminate fields of native Mexican corn (and threaten its diversity)—even though Mexico banned the growing of GM corn in the 90s.

In the US, NAFTA led to worsening environmental conditions because of the increased use of chemical fertilizers, pesticides, and water that come with such a growth of agricultural exports. The increase of US corn exports, for instance, added roughly 77,000 tons of nitrogen, phosphorus, and other chemicals into US waterways.

Further, by increasing Canada’s role as a food exporter, NAFTA increased the already high degree of consolidation in the energy- and water-intensive meat sector and fueled the growth of GM agriculture (e.g., corn, soy, canola, sugar beets), with the increased risk of contamination, use of pesticides, and spread of herbicide-tolerant weeds that follows.

In anticipation of NAFTA, the Mexican government ratified a constitutional amendment that allowed Mexican peasants to sell communal lands to private owners (including foreign corporations) without significant regulatory oversight. 28% of Mexico’s land is now devoted to mineral extraction, largely under control of transnational mining companies, and annual rates of extraction have doubled. Mining, as we all know, is not the cleanest of industries. Mexico has since become the world’s leading importer of toxic sodium cyanide, a major source of water contamination, and mining in Mexico released 43,000 tons of pollutants into the environment between 2004 and 2010.

Under a specific provision in the energy chapter of NAFTA—called the “proportionality clause”—Canada is required to maintain a fixed share of energy exports to the US. Even if Canada could not meet its own energy requirements, it would still have to keep shipping oil and gas over the border. The oil patch industry in Canada had lobbied for this provision to guarantee itself a future market. And currently, over half of Canada’s energy supply is getting sent to the US.

Even worse, by locking Canada into this export structure, the provision restricts Canada’s legal ability to regulate the extraction or ban exports of carbon- and water-intensive tar sands oil or take strong measures to reduce greenhouse gas emissions.


In Mexico, NAFTA fueled the growth of maquiladoras, export-oriented factories run by foreign companies. In 2005, they accounted for over 40% of Mexico’s exports. Between 1993 and 2004, toxic pollution from manufacturing more than doubled in a number of Mexico’s border states, and only about 10% of Mexico’s hazardous waste receives proper treatment.

NAFTA has led to increased air and water pollution in US and Canada by increasing economic activity in pollution-intensive manufacturing sectors. In Canada, largely because of the expansion of petroleum and base metal sectors, sulfur dioxide emissions rose by 66 million pounds, carbon monoxide emissions rose by 39 million pounds, and total suspended solids (a measure for water pollution) rose by 138 pounds. In the US, those numbers were 127 million pounds, 104 million pounds, and 386 million pounds, respectively.

Blocking Meaningful Environmental Regulations
NAFTA established an investor-state dispute settlement process that allows private investors and corporations to bypass domestic court systems and directly challenge government policies made in the public interest in private tribunals, such as the International Centre for Settlement of Investment Disputes (ICSID) at the World Bank, if they feel such policies reduce the value of their investments. Corporations have used this provision of NAFTA to challenge land-use, mining, and energy laws. As of March 2013, 169 cases were pending at the ICSID, one-third of which were related to oil, mining, or gas. Even when companies don’t win, their lawsuits cost money and muck up the regulatory process.

As the report makes clear, these are not just bugs, they are features of trade deals designed to prioritize of corporate profit over people and planet. And the history of NAFTA, especially given the rhetoric with which it was promoted, gives all the more reason to oppose the Trans-Pacific Partnership (TPP) and the Trans-Atlantic Trade and Investment Partnership (TTIP, or TAFTA) currently under negotiation.

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