Trade Policy Staff Committee; Public Comments on Environmental Review of Proposed Free Trade Area of the Americas

ACTION:

Notice of Initiation of Environmental Review and Request for Comments on Scope of Review, and Notice of Availability of the Report of the Quantitative Analysis Working Group and Request for Comments.

SUMMARY:

This publication gives notice that pursuant to Executive Order 13141 signed by President Clinton on November 16, 1999 (64 FR 63169) the Office of the U.S. Trade Representative (USTR), through the Trade Policy Staff Committee (TPSC), is formally initiating an environmental review of the proposed Free Trade Area of the Americas (FTAA). USTR has established an FTAA interagency group, chaired at the TPSC level, to oversee the development and implementation of the environmental review, and an interagency working group composed of economic and environmental experts, to provide guidance on the quantitative and methodological parameters of the review. Thus far, the working group has developed a draft report which provides advice on the quantitative aspects of the environmental review. This document, entitled: Report of the Quantitative Analysis Working Group to the FTAA Interagency Environment Group, is available for review on the USTR website www.ustr.gov.

In this notice, the TPSC is requesting written comments from the public regarding what should be included in the scope of the environmental review, including the identification of potentially significant environmental impacts, both positive and negative, that may arise in the context of trade liberalization. Respondents should provide as much detail as possible on the degree to which the subject matter they propose may raise significant environmental issues in the context of the negotiation. In addition, the TPSC is seeking comments on advice provided by the interagency working group regarding the methodology for performing quantitative aspects of the environmental review.

DATES:

Although USTR will accept any comments received during the course of the negotiations, comments should be submitted on or before January 19, 2001 to be assured of timely consideration in determining the scope of the environmental review.

FOR FURTHER INFORMATION CONTACT:

Background information on the Executive Order 13141, the Environmental Review Guidelines and the FTAA can be found on the USTR website ( www.ustr.gov ). FTAA information can also be found on the official FTAA website ( www.ftaa-alca.org ). For procedural questions concerning public comments, contact Gloria Blue, Executive Secretary, TPSC, Office of the USTR, 600 17th Street, NW, Washington, DC 20508 (202) 395-3475. All other questions regarding the review should be addressed to Joseph Ferrante, Director for Land Use Policy and Environmental Reviews, Office of Environment and Natural Resources, USTR (202-395-7320) or Chris Wilson, Director for Central America and the Caribbean, Office of Western Hemisphere, USTR (202-395-5190).

SUPPLEMENTARY INFORMATION:

Previous Notices

USTR welcomes and is taking into account the public comments on FTAA environmental issues submitted in response to two previous notices, the Federal Register notice dated Tuesday, December 28, 1999 (64 FR 72715) requesting written comments from the public to assist USTR in formulating positions and proposals with respect to all aspects of the negotiations, including environmental issues, and the Federal Register notice dated Thursday, June 22, 2000 (65 FR 38872) providing notice that the FTAA Committee of Government Representatives on the Participation of Civil Society had issued a request for public comments on trade matters related to the FTAA process.

Background Information

The effort to unite the economies of the Western Hemisphere into a single free trade agreement was initiated at the Summit of the Americas, which was held on December 11, 1994 in Miami. President Clinton and the leaders of 33 other Western Hemisphere countries agreed to construct a “Free Trade Area of the Americas”, or FTAA, and to complete negotiations for the agreement no later than 2005. The Miami Declaration of Principles and Plan of Action spells out the objectives of the FTAA as agreed by the leaders at the Summit. The full text can be found on the FTAA website. ( www.ftaa-alca.org/ministerials/plan_e.asp )

The FTAA represents the largest regional integration effort ever undertaken involving both developed and developing countries in a common objective to realize free trade and investment in goods and services, on a basis of strengthened rules and disciplines. In 1999 two-way merchandise trade between the United States and the 33 other FTAA countries amounted to $675 billion, with more than eighty percent taking place between the United States and NAFTA partners Canada ($365 billion) and Mexico ($197 billion). Two-way services trade amounted to roughly $93 billion in 1998 (the most recent year for which data is available), $36 billion with South/Central America and the Caribbean, $35 billion with Canada, and $22 billion with Mexico.

FTAA Objectives

Nine negotiating groups responsible for the following areas of the negotiations have been established by the FTAA countries: (1) Market access; (2) investment; (3) services; (4) government procurement; (5) dispute settlement; (6) agriculture; (7) intellectual property rights; (8) subsidies, antidumping and countervailing duties; and (9) competition policy. In addition to the nine negotiating groups, three non-negotiating committees and groups were established. They are: (1) The Consultative Group on Smaller Economies; (2) the Committee of Government Representatives on the Participation of Civil Society; and (3) the Joint Government-Private Sector Committee of Experts on Electronic Commerce. Within the nine negotiating groups, and throughout the discussions in the three non-negotiating groups, the United States seeks to maximize market openness through high levels of discipline by creating a state-of-the-art, comprehensive agreement which, inter alia, will eliminate tariffs, reduce or eliminate non-tariff barriers and trade-distorting subsidies, provide non-discrimination in services and treatment of investment, provide transparency and market access in government procurement, strengthen the protection of intellectual property, and provide transparent and effective dispute settlement. The U.S. also seeks to further secure the observance and promotion of worker rights. In addition, the U.S. is striving to make our trade liberalization and environmental policies mutually supportive. These negotiation objectives are shaped in part by the information obtained through an environmental review, which is described in more detail below.

Environmental Review

Executive Order 13141 commits the United States to a policy of careful assessment and consideration of the environmental impacts of trade agreements and calls for environmental reviews of certain proposed trade agreements during the negotiating process. These environmental reviews will help identify potential environmental effects (both positive and negative) resulting from the proposed agreement, and facilitate the development of appropriate policy responses. As lead for this activity, USTR initiated an interagency process to analyze the environmental effects of the FTAA. This review will be the first application of Executive Order 13141 to a major pluri-lateral trade negotiation, and the results of this analysis are intended to inform our negotiating positions throughout the FTAA negotiations. Ultimately, the review will include an analysis of environmental effects resulting from projected changes in economic activity as a result of negotiations, and potential impacts on U.S. environmental laws and regulations. Comments are sought on the full range of possible impacts that could be associated with the agreement, taking into account a realistic range of approaches for achieving its broad objectives, as well as the relative importance and priority of these impacts. Statements regarding potential impacts will be most useful if they are elaborated with some specificity and supported by factual references and analysis. As stated in the Executive Order, the emphasis of the review shall be on domestic impacts, but transboundry and global impacts may also be considered as appropriate and prudent.

Given the FTAA environmental review's potential complexity and significance, the FTAA Environmental Group, chaired at the TPSC level, created an interagency Quantitative Analysis Working Group composed of experts from relevant agencies. The Working Group was charged with providing advice on an analytical methodology for quantifying the environmental effects of hemispheric trade liberalization. The Working Group recently presented its recommendations regarding the completion of a quantitative analysis in a report to the FTAA Environmental Group.

This document, entitled Report of the Quantitative Analysis Working Group to the FTAA Interagency Environment Group, is available on the USTR website (www.ustr.gov).

In summary, the Working Group has recommended a two pronged approach consisting of a core (quantitative) analysis of the FTAA, accompanied by a supplemental analysis of specific economic sectors, geographic areas, and other relevant issues not covered in the core analysis. The Working Group has presented: (1) Existing methods to quantify the potential economic and environmental effects to complete the core analysis, (2) identification of and recommendations to address some of the challenges presented by the core analysis, (3) recommendations for a process to help identify priority issues and appropriate methodologies for a supplemental analysis of issues not treated in the core analysis, and (4) estimates of the resources necessary to perform the core analysis.

By itself, the proposed quantitative methodology will not constitute a comprehensive analysis of the FTAA's environmental effects; rather, the outcome of this effort is intended to feed into the larger environmental review process. In addition, the core quantitative analysis would help inform the selection of key economic sectors and geographic areas within the United States that may warrant further examination in the supplemental analysis. These issues may be analyzed in a qualitative or quantitative fashion, depending upon such factors as: the nature of potential environmental effects, data availability and the availability of methods to estimate environmental endpoints (positive or negative). As envisaged by the Working Group, once the additional issues have been identified in the core and supplemental analyses, specific recommendations can be developed regarding analytical methods. In addition, specific global and trans-boundary environmental effects that may emerge as potentially significant issues will be examined in the core and/or supplemental analyses and incorporated, as appropriate, into the environmental review. At a minimum, other components of the review will include a concurrent analysis of potential impacts on domestic environmental laws and regulations resulting from potential rules changes and changes in non-tariff barriers to trade which may result from the negotiations. In addition, specific global and trans-boundary environmental effects that may emerge as potentially significant issues will be examined and incorporated, as appropriate, in the environmental review.

The FTAA Environmental Group is favorably considering the advice and recommendations of the Working Group as presented in the proposed methodology. Following input from USTR's advisors, Congress, and the public, the Environmental Group will further refine its analytical strategy. Initiation of the entire analytical effort should take place as soon as possible to ensure the timely consideration of the results in the negotiating process.

WRITTEN COMMENTS: Persons submitting written comments should provide twenty (20) copies no later than 5:00 PM January 19, 2001, to Gloria Blue at the address listed above. Written comments submitted in connection with this request, except for information granted “business confidential” status pursuant to 15 CFR 2003.6, will be available for public inspection in the USTR Reading Room (Room 101) at the address noted above. An appointment to review the file may be made by calling Brenda Webb at (202) 395-6186. The Reading Room is open to the public from 10:00 a.m. to 12 noon, and from 1 p.m. to 4 p.m. Monday through Friday.

Business confidential information will be subject to the requirements of 15 CFR 2003.6. Any business confidential material must be clearly marked as such on the cover letter or page and each succeeding page, and must be accompanied by a non-confidential summary thereof. If the submission contains business confidential information, twenty (20) copies of a public version that does not contain confidential information, must be submitted. A justification as to why the information contained in the submission should be treated confidentially must be included in the submission. In addition, any submissions containing business confidential information must be clearly marked “confidential” at the top and bottom of the cover page (or letter) and each succeeding page of the submission. The version that does not contain confidential information should also be clearly marked, at the top and bottom of each page, “public version” or “non-confidential.”