The Ekos 707 research group at the University of Calgary prepared this brief to show why environmental considerations are necessary in the negotiations on the WTO and FTAA. In short, governments must include encouragement and facilitation of environmental management systems and environmental management tools in trade negotiations. Arguments are organized in seven points:

Environmental management in government and the private sector has proven to be pragmatic, practical, and cost effective. It is understood that partnerships will be needed to build capacity, especially in education.

	Why include environmental factors Trade negotiations must not compromise or hinder efforts to meet international and domestic environmental obligations. Results of these negotiations should be consistent with principles established in NAFTA/NAAEC/CEC and Chile negotiations. Improved environmental management is cost effective and makes good economic sense for public and private sectors. Including environmental considerations in trade negotiations does not require new policies as evidenced by existing participants’ environmental obligations in international agreements, voluntary systems (e.g., Responsible Care), and other trade agreements. See Table 1. Some economic aspects Improved environmental management enhances the benefits and controls potential negative effects of trade. Credible international business organizations such as GEMI (Global Environmental Management Initiative), and the WBCSD (World Business Council on Sustainable Development), and international organizations such as the IISD (International Institute for Sustainable Development), the CEC (Commission for Environmental Cooperation), and many academic studies such as The Green Bottom Line by Bennet and James, have provided evidence that improved environmental management provides economic benefits. Many of these studies demonstrate the economic benefits of environmental management systems (EMSs) and the use of environmental management tools. Including environmental factors in trade negotiations can encourage the export of environmental goods and services. In addition, the inclusion of environmental considerations will allow the amelioration of several current economic problems: the costs for cleanup, restoration and rehabilitation of damaged environments exceed the short term benefits; some environmental damage is irreversible; and, the inherent mal distribution of benefits and costs where money is transferred from the pollutee to polluter. Environmental management tools While we are aware the Government of Canada is favorably disposed to the use of environmental management tools, we are including our arguments because the Government still needs to convince people in Canada and in the WTO and FTAA that their use has measurable benefits. Environmental management tools to enhance benefits and control costs include: driving forces and barriers to environmental management, capacity building, policies, education and training, management structures, environmental impact assessment, environmental auditing, accounting practices (including adjusted GDP), product and technology assessment, life cycle assessment, purchasing guidelines, indicators and reporting, economic instruments, and risk management. See Attachment. International environmental management standards such as ISO 14000 establish a market driven, widely accepted minimum, which improves access to world markets. The Canadian Government must persuade the WTO and FTAA to encourage and facilitate improved environmental management within the private sector, particularly through education and training. Environmental management tools were included in the NAFTA parallel accord and have matured significantly since that time. The use of these tools in the private sector and government has also increased since the parallel accord was written. The market Improved environmental management provides the benefit of fewer constraints and subsidies, promotes the polluter pays principle, and promotes the internalization of externalities. The environmental management tools noted above play a major role in quantifying and internalizing costs. In addition to reduction of costs and improved revenues, improved environmental management will facilitate access to the largest and wealthiest markets. Environmental purchasing guidelines are now used by large customers to select products and services; improved environmental management must be used to meet the conditions of those guidelines. Therefore, including provisions for improved environmental management within the FTAA negotiations, and reducing the WTO’s interference with or resistance to environmental management, will provide direct and indirect economic benefits to both governments and the private sector. How to include environmental factors Canada must build on experiences with NAFTA/NAAEC/CEC and negotiations with Chile in trade negotiations. Canada should recommend the addition of a 10th negotiating group on environment to the FTAA to be consistent with principles established for FTAA and the structure of earlier working groups. It is important to understand the history and process of the FTAA negotiations to know about the two principles related to sustainable development and the existence of the original working group on environment, which may have been lost. See figure 1. Benefits There are a number of benefits to including environmental considerations in trade negotiations and promoting improved environmental management: enhance benefits and reduce damage of increased trade meet other domestic and international obligations maximize export of environmental goods and service quantify the benefits of good environmental management enhance access to markets Consistency with Canadian Initiatives Inclusion of environmental considerations in negotiations with the WTO and FTAA is consistent with Canadian initiatives: industry organizations and corporations follow a variety of private sector voluntary initiatives; the Canadian Standards Association (CSA) is the secretariat for the ISO 14000 series (Toronto); Montreal is the host city for the Commission for Environmental Cooperation (CEC); Winnipeg hosts the International Institute for Sustainable Development, initiated as a result of Brazil ‘92; and, Canada is the host for the year 2000 OAS conference. EKOS 707 Team Members  e-mail                                  Colin Beddoes   cgtbeddo@ucalgary.ca Chris Birchall   birchall@novachem.com Percy Garcia   pgarcia@ucalgary.ca Julia Gonzalez   jgonzale@ucalgary.ca Rachel McCormick      rachelmccormick@hotmail.com Matt Lloyd   mlloyd@ucalgary.ca Sonia Morales   morales_sonia@hotmail.com Stacey Schorr   quinshor@direct.ca Team Principal: Dixon Thompson, Professor of Environmental Science Faculty of Environmental Design, University of Calgary Calgary, Alberta, Canada T2N 1N4 Telefono: (403) 220-3625 Fax: (403) 284-4399 APRIL, 1999
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