NAFTA and the Environment: Seven Years Laterby Daniel Esty, Luis Rubio, Jeffrey J. Schott, Diana Orejas
Pub. Date: 12/28/2000
Publisher: Peterson Institute for International Economics
Conditions on the U.S.-Mexico border are often so deplorable that they seem "made for TV." Air and water pollution blighted northern Mexican cities long before NAFTA was a glimmer on the political horizon. Not surprisingly, when NAFTA became a political reality, environmentalists reacted. They argued, among other things, that commercial competition would weaken environmental standards in all three countries, and that industrial growth in Mexico would further damage its weak environmental infrastructure. The demands for action against current and potential abuses posed a serious obstacle to the completion of NAFTA negotiations. A side accordthe North American Agreement on Environmental Cooperation (NAAEC)helped alleviate some of these concerns. But in the aftermath of NAFTA's economic success, poor living conditions persist in most of Mexico. Many environmental groups blame NAFTA and, drawing on its experience, now oppose new trade initiatives.
Does the NAFTA record on the environment since 1994 justify its criticism? Seven years is too short to redress decades of environmental abuse, but it is not too soon to assess NAFTA's achievements and shortcomings in meeting its environmental objectives. In this analysis, the authors review (1) the environmental provisions of the NAFTA; (2) the NAAEC; (3) the situation at the US-Mexican border; and (4) the trends in North American environmental policy. They emphasize that the environmental problems of North America were not the result of NAFTA nor was the NAAEC devised to address all of them. But with its huge success in expanding free trade, NAFTA has concentrated population and environmental abuse at the US Mexico borderwhere it is most visible to Americans.
The authors offer recommendations to better NAFTA's environmental dimension in all three countries, and improve living conditions where economic growth is greatestat the US-Mexican border. It makes more sense to tackle the shortcomings than to lament NAFTA and the economic growth it promotes.
About the Authors: Daniel C. Esty, Senior Fellow in 1994, is Director of the Center for Environmental Law and Policy and Associate Professor in the Schools of Law and Forestry at Yale University. He served as the US Environmental Protection Agency's Deputy Assistant Administrator for Policy, Planning and Evaluation, as EPA's Deputy Chief of Staff, and as Special Assistant to EPA Administrator William Reilly. He was EPA's chief NAFTA negotiator. He is the author of a number of articles and studies on trade, competitiveness, environment, and development, including Sustaining the Asia Pacific Miracle: Environmental Protection and Economic Integration (1997) with Andr� Dua and Greening the GATT (1994).
Gary Clyde Hufbauer, Reginald Jones Senior Fellow, was formerly a Marcus Wallenberg Professor of International Finance Diplomacy at Georgetown University (1985-92); Deputy Director of the International Law Institute at Georgetown University (1979-81); Deputy Assistant Secretary for International Trade and Investment Policy of the US Treasury (1977-79); and Director of the International Tax Staff at the Treasury (1974-76). He has written extensively on international trade, investment, and tax issues, including Unfinished Business: Telecommunications after the Uruguay Round (1997, coeditor), Flying High: Liberalizing Civil Aviation in the Asia Pacific (1996, coeditor), Fundamental Tax Reform and Border Tax Adjustments (1996), Western Hemisphere Economic Integration (1994), Measuring the Costs of Protection in the United States (1994), NAFTA: An Assessment (rev. 1993), US Taxation of International Income (1992), North American Free Trade (1992), Economic Sanctions Reconsidered (2d edition 1990), Trade Policy for Troubled Industries (1986), and Subsidies in International Trade (1984).
Jeffrey J. Schott, Senior Fellow, was a Senior Associate at the Carnegie Endowment for International Peace (1982-83) and an International Economist at the US Treasury (1974-82). He is the editor of The WTO after Seattle (2000), Launching New Global Trade Talks: An Action Agenda (1998), Restarting Fast Track (1998), The World Trading System: Challenges Ahead (1996), author of WTO 2000: Setting the Course for World Trade (1996), The Uruguay Round: An Assessment (1994), coauthor of Western Hemisphere Economic Integration (1994), NAFTA: An Assessment (rev. 1993), North American Free Trade: Issues and Recommendations (1992), Completing the Uruguay Round (1990), Economic Sanctions Reconsidered (2d edition 1990), Free Trade Areas and US Trade Policy (1989), The Canada-United States Free Trade Agreement: The Global Impact (1988), Auction Quotas and US Trade Policy (1987), and Trading for Growth: The Next Round of Trade Negotiations (1985).
Table of Contents1. Introduction and Summary
2. The NAFTA's Environmental Provisions
3. The North American Agreement on Environmental Cooperation
4. The US-Mexico Border
5. Environmental Policy Trends in North America
6. Conclusions and Recommendations
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