FTAA threat to forests

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IMPACT OF THE FREE TRADE AREA OF THE AMERICAS ON FORESTS

-- A forest-specific analysis of the draft text of the FTAA --

 

The Free Trade Area of the Americas (FTAA) risks undermining forest and

ecosystem health by accelerating industrial clearcut logging, weakening

protection from invasive species and genetically modified organisms (GMOs),

and binding the hands of countries from using various policy tools for the

conservation of their natural resources. The FTAA would cause these

environmental impacts by embracing many of the most ecologically problematic

elements of the North American Free Trade Agreement (NAFTA) and the World

Trade Organization (WTO)—and by embarking upon new international trade and

investment terrain—in its efforts to subjugate the health of the hemisphere’

s forests and ecosystems to the goal of trade and investment

liberalization.*

 

1. The FTAA would cause the acceleration of industrial clearcut logging and

conversion of native forests.

 

Accelerated logging. Logging pressures on native forests, including the

conversion of primary forests to tree plantations, would increase in

critical regions of the hemisphere as a result of the elimination of tariffs

on forest products. Particular concern arises when considering the impact on

the globally significant old growth temperate forests of Chile, which harbor

high levels of biological diversity and have been identified in a study by

the office of the U.S. Trade Representative as an area where heightened

exploitation would result from global forest products tariff elimination.

Relevant portion of draft text: Chapter on Market Access, Article 4.

 

Forest conversion. Conversion of native forests to export-oriented

agricultural uses would accelerate due to the reduction, and eventual

elimination, of tariffs on agricultural products such as beef and soybeans.

The expansion of crop acreage will put new pressures on forest regions,

particularly the Amazon, as landless people are pushed further into

undeveloped areas. Relevant portion of draft text: Chapter on Agriculture,

Article 4.

 

2. The FTAA would impede the authority of governments to protect their

forests or to provide standards, incentives, or quantitative restrictions

aimed at ensuring sustainable forest management.

 

Lawsuits preventing forest protection. Foreign companies could be empowered

to sue governments when they feel that their ability to earn a profit from

their investment is inhibited by forest management and protection standards,

or by the return of land to indigenous communities. These investor

protection suits ensure against not only “expropriation” of corporate

profits, but also against environmental safeguards that are “tantamount” to

expropriation. As has been the case under NAFTA, transnational corporations

have used investment rules to pursue awards of up to $970 million, as well

as the overturning of environmental laws. The FTAA may further impede

measures enacted by countries to strengthen their forest protection laws by

forcing them to compensate timber companies for lost profits resulting from

stronger laws. Relevant portion of draft text: Chapter on Investment,

Articles 10 and 15.

 

Elimination of forest protection policy tools. If the hemisphere’s nations

agree to accept the proposed text, they would be prohibited from enacting

regulations for forest protection, such as eco-labeling laws and bans on raw

log exports, where they are deemed to be “non-tariff” barriers to trade or

competition. Likewise, governments would be restricted in their ability to

establish product standards or government purchasing requirements with

forest protection as the objective, including the adoption of certification

standards. FTAA rules could also prevent countries from enacting

“quantitative restrictions,” or quotas, on the importation of wood products,

including the massive influx of heavily subsidized lumber sourced form

Canadian old growth forests into the United States. Relevant portion of

draft text: Chapter on Market Access, Article 10; Chapter on Standards and

Technical Barriers to Trade, Article 3; Chapter on Competition, Article 1;

Chapter on Government Procurement, Article 26.

 

Limiting conservation measures in the service sector. Countries would be

prohibited from taking appropriate measures to protect the environment and

natural resources in a broadly defined “service sector”—including energy,

water, tourism, and waste disposal—under proposed language. This would

prevent governments from adopting “limitations on the number of service

suppliers” for hazardous waste facilities, oil and gas operations,

mechanized vehicles used in heavy tourism areas, and water providers. As a

result, local, state, and federal lawmakers would lose the ability to set

specific limits on the number of facilities for these industries,

potentially resulting in the loss of forests, coral reefs, and wetlands,

disturbance to migration patterns, harm to wildlife, and intense localized

pollution. Relevant portion of draft text: Chapter on Services, Article 7.

 

Loss of democracy and public involvement. Under the draft language governing

dispute settlement, governments would surrender to unelected international

tribunals the adjudication over their safeguards for forest protection. This

applies broadly, not only to forest protection laws and regulations in which

the FTAA is deemed to be “prejudiced” or “frustrated,” but also “… when a

Party considers that an actual [or proposed] measure of another Party is [or

would be] inconsistent with the obligations of the FTAA Agreement [or, even

if not inconsistent, could cause nullification of impairment of any benefit

that a Party could reasonably have expected to accrue to it under this

Agreement…]” The participation of non-governmental organizations in FTAA

tribunals may not be permitted, even though the binding decisions by

“neutral panels,” are not subject to appeal and favor the removal of

environmental laws where they conflict with the FTAA. Relevant portion of

draft text: Chapter on Dispute Settlement, Articles 2, 4, 39, and 45.

 

3. The FTAA would weaken standards that prevent the importation of invasive

pests species or threats from genetically modified organisms (GMOs).

 

Spread of invasive species. Precautionary measures aimed at preventing the

spread of ecologically and economically destructive invasive plants and

animals would be further impeded if proposed Sanitary and Phytosanitary

(SPS) measures are adopted. FTAA member countries would have the burden of

providing costly scientific proof that measures were justified, if national

safeguards exceed international standards adopted by industry-influenced,

quasi-governmental organizations that are relatively closed to public

scrutiny. More species with impacts similar to the Asian long-horned beetle,

zebra mussel, and gypsy moth, may take hold in FTAA member nations as a

result of the link of increased flow of invasive species to heightened

levels of trade. Relevant portion of draft text: Chapter on Agriculture,

Article 17.

 

Genetically modified tree risks. If the draft text is accepted by FTAA

countries, they will be required to allow the patenting of genetically

modified organisms, including genetically engineered vascular plant and tree

species capable to disrupting native ecosystems. Relevant portion of draft

text: Chapter on Intellectual Property Rights, Section 10.

 

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* Since the FTAA text that has been released exists in a draft form, this

analysis is based on an evolving document. Most of the draft text has been

provided in brackets, indicating an unknown level of consensus between

countries, and complicating an assessment as to whether each of the

provisions harmful to forests would exist in a final FTAA agreement. Thus,

the impacts of the FTAA on forests described in this analysis could be

maintained, altered, removed, or made worse, through the process of

negotiations by the participating countries, and if a final trade deal is

reached. This analysis estimates possible effects that the FTAA could have,

based upon the draft text, as released on July 3, 2001.

 

Analysis by Jason Tockman, director of the International Trade Program of

American Lands Alliance. January 2002.

 

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Jason Tockman, Director

International Trade Program

American Lands Alliance

PO Box 555

Athens, OH 45701

(740) 594-5441