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Chile Eludes Environmental Clauses

5 July, 2002

SANTIAGO, Jul 1 (IPS) - The controversy over the environmental question in international trade talks is heating up in this South American nation, where the government signed a free trade treaty with the European Union (EU) and is seeking a similar accord with the United States this year.

Usually included in the central text of a trade agreement, environmental clauses create obligations for the signatories to heed international environmental conventions and slaps trade sanctions on any party that fails to comply with those rules.

The Chilean government considered the most appropriate solution to be the approach it took in the free trade treaty signed with Canada in 1996, which does not contain environmental or labour clauses, matters that were relegated to annex protocols that were signed by the two countries in parallel to the main accord.

The Chilean authorities believe this formula is a model of how negotiations should be conducted by a developing country with an industrialised country, and they are attempting to repeat it in talks with the United States.

However, environmental organisations in Chile and the United States are incensed at such political manoeuvring.

The environmental aspects related to trade are one of the pending issues of the new round of multilateral trade talks begun last November under the auspices of the World Trade Organisation (WTO), but it is a difficult matter that could explode at the body's next ministerial conference, slated for 2003 in Mexico.

In the absence of a global standard, the trade-environmental equation is often left open to the lobbying capacity of the parties involved in bilateral or multilateral negotiations.

The conflicts are most evident in asymmetric talks, when powerful countries attempt to subject their potential developing country trade partners to submit to the former's environmental legislation, which tends to be stricter.

Although the final text of the Chile-EU agreement is still being drafted, the preliminary protocol upholds a widespread trend: binding trade to internationally recognised environmental treaties, such as the conventions on climate change, ozone layer protection and biological diversity.

The information released by the Chilean Foreign Ministry, in charge of the talks, does not include mention of environmental clauses, though it underscores the EU's willingness to provide broad cooperation with Chile in this area.

The matter becomes more complicated in the context of the talks with the United States, where there is heavy pressure from ecological organisations, unions and some farmers that are in favour of introducing environmental and labour clauses.

The Chilean Alliance for Fair and Responsible Trade is also inclined towards such clauses, arguing that the transnational corporations keep their eyes on such trade treaties and accords in order to transfer their investments to countries whose fragile legislation allows them to exploit their natural resources.

Rodrigo Pizarro, an economist for the independent Terram Foundation, objects to the Chilean accord with the EU, saying he believes it will only make Chile more dependent on primary commodity exports and open up its fishing wealth to the European bloc.

But the government is of a different opinion. The environmental clauses distort the trade aspects of the treaties and open the door to arbitrary decisions and possible sanctions for non-compliance, said the head of the Trade Policy Department at the Chilean foreign ministry, Ricardo Lagos Weber.

The official admitted that the problem lies in the fact that while the WTO serves as a sort of supra- organisation dictating trade norms, there is not an equivalent global authority on the environment for agreements on obligatory procedures for the entire international community.

In this context, environmental organisations in the developing South, like the Malaysia-based Third World Network, warn that the inclusion of social and environmental clauses could turn out to be a mechanism that reverses the deregulatory nature of free trade, but also serve as a barrier imposed by the industrialised North for exports coming from developing countries.

* Tierramérica is a specialised news service (www.tierramerica.net) produced by IPS with the backing of the United Nations Development Programme and the United Nations Environment Programme. (END/IPS/LA/EN-IF/TRA-SO LD/GGR/02)

By Gustavo González - Tierramérica *

Source: www.ips.org

From: gondwana@adsl.tie.cl

Defensores del Bosque Chileno
Diagonal Oriente 1413
Ñuñoa- Santiago
Chile Tel. 56.2.2041914
Fax 56.2.2092527 http://www.elbosquechileno.cl

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