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OAS RELEASES STUDIES ON SUSTAINABLE TRADE IN ARGENTINA, BRAZIL

The Organization of American States (OAS) today will release the results of environmental sustainability assessments examining how trade liberalization under the Free Trade Area of the Americas (FTAA) would affect Argentina and Brazil.

The publications, produced by the OAS Unit for Sustainable Development and Environment, will be presented at a reception for participants of the Americas Trade and Sustainable Development Forum, being held in conjunction with the FTAA Ministerial Meeting in Miami.

The Argentina case study indicates that the most environmentally sensitive sectors would be the meat, sugar, metal, iron and steel industries. The Brazil study indicates that the FTAA would have a very minor direct environmental impact in the direction of lower air pollution intensity and energy uses.

“These types of assessments are an important tool to promote sustainable trade policies at the country level and to achieve the type of sustainable hemispheric economic integration envisioned by the OAS member states,” said Scott Vaughan, Director of the OAS Unit for Sustainable Development and Environment.

The Argentina case study – by Walsh, Ortíz and Galperín of the Environment and Natural Resources Foundation (Fundación Ambiente y Recursos Naturales) – includes an economic analysis of the potential changes in trade flows under hemispheric trade integration, taking into account different possible scenarios. The analysis focuses on gas emissions, as well as solid and liquid effluents, in the most sensitive industrial sectors and identifies policy options for sustainable trade, in the context of Argentina’s legal and institutional framework.

The Brazil study – a by Seroa Da Motta, of the Institute for Applied Economics Research in Rio de Janeiro – finds that the expected changes brought by the FTAA would occur mainly in sectors where progressive technological and environmental policies and the motivation to meet export market’s stricter environmental rules already exist. The study also analyzes the growing effectiveness of the Brazilian legal institutional framework and discusses how industrial environmental control costs are, on average, low and do not restrict competitiveness. It also includes recommendations to be adopted by regulators that further enhance the industrial sector’s current economic efficiency and competitiveness.

The assessments use an economic model to determine which sectors are most likely to change or grow with trade liberalization and also include an environmental impact assessment, a legal analysis and policy options for sustainable trade. Stakeholders from the government, private sector and academia were consulted as part of the process.

The publications are the first to be released under the Environmentally Sustainable Trade Project executed by the OAS Unit for Sustainable Development and Environment through it’s Inter-American Forum on Environmental Law (FIDA). The project was developed in response to mandates from the Summit of the Americas Process and has the support of the United States Agency for International Development (USAID), the Charles Stuart Mott Foundation and other partners, including the University of Miami, the Tulane Institute for Environmental Law and Policy, the World Resources Institute and Fundación Ambiente y Recursos Naturales in Argentina.

The OAS Unit for Sustainable Development and Environment, through FIDA, is also working with local partners from the region on assessments for Uruguay, Paraguay, Costa Rica and Guatemala, in addition to exploring possibilities for project expansion to Caribbean and Andean countries.

Reference: E-222/03