The North American Free Trade Agreement: Green Law or Green Spin?
Charnovitz, Steve, Law and Policy in International Business
Throughout the debate in the United States on the North American Free Trade Agreement (NAFTA)(1), the environmental implications of the NAFTA have loomed as an important factor.(2) Because the NAFTA was viewed as environmentally inadequate by the Clinton administration, the three parties negotiated a side agreement, the North American Agreement on Environmental Cooperation (NAAEC).(3) The NAFTA and the NAAEC both came into force on January 1, 1994, after a bruising battle in the U.S. Congress.(4) Many of those lobbying for NAFTA's approval by the Congress, including the Clinton administration, trumpeted NAFTA's "greenness" as a key reason for adopting the trade agreement. The convoluted politics of the NAFTA made for strange bedfellows. Many members of Congress and interest groups not normally known for strong environmental advocacy highlighted the environmental benefits of the two agreements. For example, Congressman David Dreier (R-Calif.) stated that the "NAFTA is a pro-environment, free trade agreement, not a trade agreement hijacked by extremist interest groups."(5) Conversely, some public officials and interest groups that were known for strong environmental advocacy denied that the NAFTA or the NAAEC would deliver significant environmental benefit.(6)
The purpose of this Article is to analyze the main environmental issues involved in the debate, by examining several critical questions such as: (1) Is the NAFTA really green, or did NAFTA proponents spin the environmental provisions far out of proportion? (2) Does the NAFTA break new ground in incorporating an environmental dimension into trade agreements, or are the so-called environmental "rights" in NAFTA just a reaffirmation of the status quo?(7) (3) Did the federal government "sell" the NAFTA to the American public in an honest manner?
After examining these questions, the Article concludes that there is very little that is "green" about the NAFTA. This conclusion differs from the conclusions reached by most other commentators who have studied the environmental aspects of the NAFTA. In this author's opinion, the NAFTA is a good trade agreement that will economically benefit the United States. But since the Clinton administration pointed to the NAFTA's environmental provisions as a key reason to support the NAFTA, it is useful to analyze these arguments to determine their veracity. The Article concludes that much of the Administrations's rhetoric was false.
The analysis will proceed in the following manner: Part I will explain the rules of the General Agreement on Tariffs and Trade (GATT),(8) as they relate to the environment, in order to provide a baseline for judging the significance of the NAFTA. Part II will examine some of the environmental claims made, in the words of NAFTA proponents, and compare them to the actual terms of the Agreement. This Part will focus mainly on the NAFTA rather than the NAAEC, because the Canadian, Mexican, and U.S. governments devoted considerable effort to keeping most environmental issues on a track separate from the NAFTA (the so-called parallel track),(9) so it would seem inappropriate to merge them after the fact. Moreover, the agreements are legally separate. Part III will discuss two post-NAFTA developments: the environmental side agreement (NAAEC) negotiated by the Clinton administration and the conclusion of the Uruguay Round. Part IV will put these issues in a broader political context and attempt to draw some conclusions.
1. GATT's Environmental Baseline
A. Selecting the Baseline
Part I will offer a brief primer on the main GATT rules affecting environmental measures. Since my purpose is to provide a baseline for analyzing the NAFTA, only those GATT rules relating to NAFTA's environmental provisions will be discussed.(10) Besides the GATT, there are other relevant baselines which could be used in analyzing the NAFTA. For instance, the NAFTA could be compared to the GATT Agreement on Technical Barriers to Trade of 1979 (known as the "Standards Code") which all three NAFTA parties have joined. …