MEXICANA DE ACCION FRENTE AL LIBRE COMERCIO
The Mexican Action Network on Free Trade
Réseau Mexicain d'Action Sur le Libre - Échange
NAFTA and the Mexican Environment
Many promises were made by the Mexican, U.S. and Canadian governments during the NAFTA debate. Among these were assurances that the Agreement, along with the increased trade and investment that it would engender, would lead to improvements in environmental conditions in Mexico. The reality has been otherwise.
Increased trade and investment have exacerbated
the environmental problems in Mexico that have accumulated over the years.
The impact of increasing trade and investment, coupled with the environmental
policies of the Mexican government, have increased environmental degradation
in this country. Environmental laws have been subordinated to commercial
and financial interests, meaning that, in some cases, the law is not enforced.
This new environmental degradation only adds to the existing problems.
For example, in response to citizen complaints about the recurrent and
highly hazardous pollution produced by Stephan Chemical's pesticide plant
in Matamorros, the Mexican Environment Protection Federal Attorney's Office
declared the plant and the surrounding area a "high risk" zone.
Without considering any alternatives, it then ordered the displacement
of the population of thirteen towns and five communal lands in the area
in order to permit the company to continue operations.
Much of the increase in environmental contamination is accounted for
by a few large firms that dominate the local economy. Approximately 80%
of the total value of the Mexican export industry is controlled by two
percent of the total number of companies in the country, most of which
are transnational corporations. Many of these (particularly those in the
electronics, textile and chemical sectors) are classified by the U.S. Environmental
Protection Agency as industries utilizing highly toxic and dangerous processes.
Even official statistics, however, show that only 10% of the seven million
tons of toxic waste these industries generate is properly treated.
Before NAFTA's inception, the U.S. government acknowledged that more
than US$20 billion would have to be invested along the Mexican-U.S. border
to improve the critical environmental conditions in the region. No significant
amount, however, has been invested to date, and alarming conditions continue
to exist in the northern border region. The binational Toxic and Hazardous
Waste Monitoring System -- known as Haztraks -- has not even been implemented,
in part because it is estimated that fewer than 30% of the region's industries
comply with applicable regulations.
NAFTA's environmental tools are too weak.
NAFTA's environmental instruments, which include the North American
Development Bank (NADBank) and the Border Environmental Cooperation Commission
(BECC) are so weak and so far from the realities of the border communities
that, after three years of existence, they have not been able to build
any environmental infrastructure. The Clinton Administration used the creation
of these institutions to present NAFTA as the "greenest trade agreement
ever signed." As of January 1997, the NADBank had approved loans totalling
just US$7.4 million.
At the same time, the increase in the number of foreign companies that
are relocating production to Mexico to take advantage of lower environmental
and labor costs has led to an aggravation and extension of environmental
degradation. As long as weaknesses in the enforcement of environmental
laws are not overcome, the potential benefits of international assistance
from agencies like the BECC and NADBank will not be realized.
Environmental concerns are not integrated
in the text of NAFTA.
Although Article 1114 of NAFTA establishes that it is "inappropriate"
for governments to diminish their environmental standards to attract investment
or boost trade, and the North American Agreement on Environmental Cooperation
(NAAEC, NAFTA's side agreement on the environment) establishes mechanisms
for citizens' complaints, they have had little impact. The effectiveness
of the Environmental Commission established under the NAAEC has been quite
limited due to its lack of a strong legal foundation. In practice, complaints
raised by citizens' organizations serve mainly as mechanisms of political
pressure in the country in which the demands are raised, rather than as
effective means for resolving the problems through the NAAEC. In Mexico,
there are at least two examples: the case of increased migrant-bird mortality
in Presa Silva in Guanajuato; and the case of the construction of a new
pier over a coral reef in Cozumel. In both cases, the decision as to whether
or not to accept the complaints rests with the relevant governmental ministers,
who judge the cases more on their political than legal merits.
The NAAEC has not been utilized to alleviate environmental problems
in Mexico or to prevent their worsening. The lack of real integration of
environmental, trade and economic policies has led to the depletion of
environmental, social and human resources. Moreover, NAFTA allows the Mexican
government to continue to set investment policies that do not require domestic
or foreign investors to internalize these costs. Therefore, the country
continues to subsidize economic, environmental and social inefficiency,
thus postponing sustainable development. These policies have resulted in
an alarming deterioration in indicators of living conditions in border
communities. Infectious diseases propagate due to a lack of safe drinking
water, and some children have been born with anencephaly (without brains),
most likely due to the presence of toxic chemicals in the environment.
Environmental legislation and enforcement
Although the enactment of certain environmental legislation has been
achieved under the recent reform of the General Ecological and Environmental
Protection Law (LEEGPA), there is a tendency to weaken its enforcement
through the creation of sectoral legislation that undermines the levels
of protection established in the new environmental code. Also, the issuance
of discretional presidential decrees, as well as severe budget restrictions,
limits the ability of the appropriate agencies to enforce the law.
The limited budgets for environmental infrastructure and enforcement
constitute serious constraints. In 1996, the Ministry for the Environment
(Secretaria del Medio Ambiente, Recursos Naturales y Pesca) had a budget
of just US$999 million (down from $1.289 billion in 1985). In comparison,
US$29.864 billion was paid in 1996 to service Mexico's foreign debt. Thus,
the Ministry's annual budget represented in 1996 just 3.5% of the amount
paid to service the debt.
*Trade and investment policies must be made compatible with social and
environmental concerns so that sustainable development can be attained.
NAFTA must be renegotiated to integrate environmental protection and funding
sources into the text of the Agreement.
*Along with an overall policy designed to promote economic, environmental
and social efficiency, instruments for a more balanced form of integration
must be created. These would include funds for the construction and reconstruction
of environmental infrastructure, as well as for institutional and community
capacity building and for the transfer of clean technology.
*Trinational institutions must be created that, while respecting each
country's sovereignty and promoting international cooperation, guarantee
the implementation of integrated policies and commitments. Likewise, transparent
trinational mechanisms that include the participation of citizens' organizations
must be created, so that the latter can exercise their legitimate rights.
*At a national level, with or without the renegotiation of NAFTA, at
least two changes are necessary: constitutional reforms must be made that
guarantee citizens the right to a clean and balanced environment, which
means that the LEEGEPA must be reinforced and respected by all means; and
the current economic and investment policies must be transformed so that
they serve as tools for the country's true development.
For more information, contact Alejandro Villamar at RMALC.
This factsheet is excerpted from Espejismo y realidad: el TLCAN tres años después, Análisis y propuesta desde la sociedad civil, by the Mexican Action Network on Free Trade (RMALC). The full report is available for US$10 from RMALC, tel/fax (525) 355-1177, email firstname.lastname@example.org.
Translated by The Development GAP