The greening of US free trade agreements

The Greening of US Free Trade Agreements This book provides an up-to-date critical analysis of the integration of environmental policies into US free trade agreements The work focuses on the evolution of the design of environmental policies and analyzes their effectiveness Starting with the North American Free Trade Agreement (NAFTA) leading to the Trans-Pacific Partnership (TPP), the book examines the history of policy integration In doing so, it provides an overview of the major trade-related environmental policies and presents empirical research on their effectiveness, a discussion of the continued demand for policy integration in light of the effectiveness, and recommendations for addressing shortcomings The main objective of the book is to inform the ongoing policy debate over integration of environmental policies into trade agreements The current renegotiation of NAFTA provides an opportune time for undertaking this critical review of trade-related environmental policies As our understanding and knowledge of the environmental policies associated with US trade agreements, in particular for NAFTA, has grown significantly over the past twenty-five years, this book provides a timely and critical update for this policy debate Students and scholars of environmental law, trade and economics, and specifically US trade, environmental policy and law will find this book of great interest Linda J Allen is Adjunct Instructor in the School of Science, Technology, Engineering, and Math at American Public University System, USA She served as a AAAS Diplomacy Fellow at the US Department of State from 2003 to 2005, and was a member of the US delegation to negotiate the environmental policies for the then Andean Free Trade Agreement Routledge Focus on Environment and Sustainability The Application of Science in Environmental Impact Assessment Aaron Mackinnon, Peter Duinker and Tony Walker Jainism and Environmental Philosophy Karma and the Web of Life Aidan Rankin Social Sustainability, Climate Resilience and Community-Based Urban Development What About the People? Cathy Baldwin and Robin King South Africa’s Energy Transition A Roadmap to a Decarbonised, Low-cost and Job-rich Future Terence Creamer and Tobias Bischof-Niemz The Environmental Sustainable Development Goals in Bangladesh Edited by Samiya A Selim, Shantanu Kumar Saha, Rumana Sultana and Carolyn Roberts Climate Change Discourse in Russia Past and Present Edited by Marianna Poberezhskaya and Teresa Ashe The Greening of US Free Trade Agreements From NAFTA to the Present Day Linda J Allen For more information about this series, please visit: www.routledge.com/ Routledge-Focus-on-Environment-and-Sustainability/book-series/RFES The Greening of US Free Trade Agreements From NAFTA to the Present Day Linda J Allen First published 2019 by Routledge Park Square, Milton Park, Abingdon, Oxon OX14 4RN and by Routledge 711 Third Avenue, New York, NY 10017 Routledge is an imprint of the Taylor & Francis Group, an informa business © 2019 Linda J Allen The right of Linda J Allen to be identified as author of this work has been asserted by her in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988 All rights reserved No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data A catalog record for this book has been requested ISBN: 978-1-138-32179-3 (hbk) ISBN: 978-0-429-45241-3 (ebk) Typeset in Times New Roman by Apex CoVantage, LLC Contents List of tables Acknowledgments vi viii Introduction Status quo: existing environmental policies 25 What have we learned 56 Future of integration of environmental policies 115 Index 125 Tables 1.1 1.2 A1 A2 A3 A4 A5 2.1 B1 B2 B3 B4 B5 B6 B7 B8 3.1 3.2 3.3 US Free Trade Agreements (FTA)/Trade Promotion Agreements (TPA) Environmental negotiating objectives for US trade agreements10 Environmental negotiating commitments for NAFTA 15 Environmental negotiating objectives in Trade Act of 2002 16 Environmental negotiating objectives in Bipartisan Agreement on Trade Policy: Environment (May 2007) 17 Environmental negotiating objectives in Bipartisan Congressional Trade Priorities and Accountability Act of 2015 18 Environmental renegotiation objectives for NAFTA 20 Institutional structures for environmental policy implementation36 Aspirational policies by substantive content, policy locus, and policy generation 39 Cooperative policies by substantive content, policy locus, and policy generation 41 Quasi-regulatory policies by substantive content, policy locus, and policy generation 43 Permissive policies by substantive content, policy locus, and policy generation 45 Examples of specific language for aspirational policies 46 Examples of specific language for cooperative policies 47 Examples of specific language for quasi-regulatory policies48 Examples of specific language for permissive policies 51 Environmental side agreement work plans 60 Meetings of oversight bodies 61 NAFTA cooperative policies – environmental cooperation activities64 Tables 3.4 3.5 3.6 3.7 3.8 3.9 3.10 3.11 3.12 C1 C2 C3 C4 Environmental cooperation initiatives selected for assessment CAFTA-DR cooperative policies – environmental cooperation topics CAFTA-DR cooperative policies – key outcomes for institutional strengthening CAFTA-DR cooperative policies – key outcomes for biodiversity and conservation CAFTA-DR cooperative policies – key outcomes for market-based conservation CAFTA-DR cooperative policies – key outcomes for private sector performance Peru trade agreement cooperative policies – environmental cooperation activities Oman trade agreement cooperative policies – environmental cooperation activities Singapore trade agreement cooperative policies – environmental cooperation activities NAFTA environmental cooperative initiatives, 1995–2010 NAFTA environmental cooperative initiatives, 1995–2010 NAFTA environmental cooperative initiatives, 2011–2016 NAFTA environmental cooperative initiatives, 2011–2016 vii 66 79 80 80 81 82 85 87 89 100 102 104 106 Acknowledgments The author acknowledges that funding for some of the research presented herein was provided by Indiana University and the North American Commission for Environmental Cooperation, and portions of this book are based on the following previously published articles: “The North American Agreement on Environmental Cooperation: Has it fulfilled its promises and potential? An empirical study of policy effectiveness” published in 2012 in the Colorado Journal of International Environmental Law and Policy (23(1)); “Trade and environment: A new direction for green trade” published in 2014 in The Estey Centre Journal of International Law and Trade Policy (15(1)); “The Environment and NAFTA Policy Debate Redux: Separating Rhetoric from Reality” published in 2018 in the William and Mary Environmental Law and Policy Review (42(3)); and “Reassessing the ‘Green’ in NAFTA” published in 2018 in the Journal of World Trade (52(4)) The author also thanks interviewees for taking time to share their views on the effectiveness of the environmental policies for US trade agreements The responsibility for the content, and all errors and omissions, lies entirely with the author Introduction Historically, trade agreements in the US were negotiated far from the public eye by a small group of policymakers and business leaders and rarely generated headlines Although these agreements created winners and losers, the economic rationale for free trade was strong: on the whole it benefited the greater society and thus was desirable The economic rationale for free trade has remained the same, but since the 1980s, trade agreements have garnered many headlines as the desirability of reducing barriers to trade has been increasingly brought into question Trade agreements have led to major labor dislocations and impinged on issues unrelated to trade, such as labor rights, human rights, cultural heritage, public health, and environmental protection In response to this changing view, the US has continued to pursue trade liberalization but sought to address some of these issues directly in its trade agreements This book examines in detail its efforts to so for one particular issue, environmental protection The story about the “greening” of US trade agreements begins with the North American Free Trade Agreement (NAFTA), probably the most studied trade agreement in history In June 1990, the US and Mexico announced their intent to negotiate a bilateral trade agreement to reduce barriers to trade and improve protections for foreign investment for the two countries (Fletcher & Tiemann, 1992) This trade agreement, which eventually became NAFTA and included Canada as well, would establish one of the largest free trade blocs in the world and strengthen economic ties between the US and it two largest trading partners Despite its potential to promote economic growth, the announcement on the trade agreement set off alarms for environmentalists in the US and the other two countries, who quickly raised concerns that increased trade would weaken environmental protection in North America Initially, environmentalists had little influence on policymakers, and their concerns were barely on the radar at the onset of negotiation of NAFTA However, by the time NAFTA was submitted for legislative approval in 1993, the inclusion of policies in the trade agreement to address the environmentalists’ concerns had become a political imperative required for its ultimate passage 114 What have we learned US Government Accountability Office (2014, November) Office of the U.S Trade Representative should continue to improve its monitoring of environmental commitments US–Oman Memorandum of Understanding on Environmental Cooperation (2007) Retrieved from https://www.state.gov/e/oes/eqt/trade/oman/81066.htm US–Oman Work Plan for 2014-2017 (2014) Retrieved from https://2009-2017 state.gov/e/oes/eqt/trade/oman/239391.htm US–Peru Environmental Cooperation (2009) 2009–2010 work program US–Peru Environmental Cooperation (2011) 2011–2014 work program US–Peru Environmental Cooperation (2015) 2015-2018 work program US–Peru Secretariat (n.d.) Secretariat for Submissions on Enforcement Matters Retrieved from https://www.saca-seem.org/secretariat US–Peru Trade Promotion Agreement (2007) Office of US Trade Representative website Retrieved from https://ustr.gov/trade-agreements/free-trade-agreements/ peru-tpa USTR (2013) United States–Peru Trade Promotion Agreement: Strengthening forest sector governance in Peru USTR, In ‘Unprecedented’ Action Orders Halt of Peruvian Timber Imports (2017, October 27) Inside US Trade Vaughan, S (2002) Understanding the environmental effects of trade: Some lessons from NAFTA In J J Kirton, & V W Maclaren (Eds.), Linking trade, environment, and social cohesion: NAFTA experiences, global challenges Vaughan, S (2004) Thinking North American environmental management In T J Courchene, D J Savoie, & D Schwanen (Eds.), The art of the state II: Thinking North America Montréal: Institute for Research on Public Policy Vidal, R M., Berlanga, H., & Arizmendi, M (2009) Important bird areas Americas Mexico In C Devenish, D F Díaz Fernández, R P Clay, I Davidson, & I Yépez Zabala (Eds.), Important bird areas Americas: Priority sites for biodiversity conservation Retrieved from www.birdlife.org/datazone/userfiles/file/IBAs/ AmCntryPDFs/Mexico.pdf Winfield, M S (2003) North American pollutant release and transfer registries: A case study in environmental policy convergence In J H Knox, & D L Markell (Eds.), Greening NAFTA: The North American Commission for Environmental Cooperation (pp 25–37) Stanford, CA: Stanford University Press Wold, C (2008) Evaluating NAFTA and the Commission for Environmental Cooperation: Lessons for integrating trade and environment in free trade agreements St Louis University Public Law Review, 28, 201–252 Young, O & Levy, M (1999) The Effectiveness of International Environmental Regimes In O Young (Ed.), The effectiveness of international environmental regimes: causal connections and behavioral mechanisms Cambridge, MA: MIT Press Future of integration of environmental policies The “greening” of NAFTA in the early 1990s was a watershed in trade policymaking, marking the first time that the US had explicitly integrated environmental policies and protection goals into its free trade agreements Since NAFTA, the US has continued to integrate a suite of environmental policies into thirteen other bilateral and regional free trade agreements with 24 countries to address a variety of environmental issues and concerns associated with trade liberalization Despite this long tradition of policy integration, the inclusion of environmental policies into trade agreements remains contentious, and questions over the adequacy of the policies have repeatedly been raised To better understand the tangible benefits of these environmental policies and justify their continued integration into US trade agreements, an assessment of the policy effectiveness was completed and documented in Chapter The primary purpose of the assessment was to ascertain whether the policies are having their intended effect and addressing the concerns that gave rise to their creation in the first place Overall, it appears that the policies have had limited effectiveness, but there may be several reasons for their limited impact, and the assessment also provided important insights into why the policies may not be effective due to, for example, inadequate implementation, poor policy design, or changes in the nature of the policy problem This last chapter summarizes the main findings from the policy assessment and also discusses some of the reasons why the environmental policies may have had limited effectiveness These additional insights on the policy effectiveness are equally useful for policymakers to decide which environmental policies should be retained for future trade agreements, which policies need to be strengthened, and which policies may no longer be needed Taking into consideration these insights, this final chapter also presents recommendations for the future integration of environmental policies in US trade agreements 116 Future of integration Recap of major policies and their effectiveness The US has integrated a suite or portfolio of environmental policies into fourteen trade agreements, and these policies are located in two separate legal instruments, typically an environment chapter of the trade agreement and an associated environmental side agreement Collectively, the purpose of these policies has been to maintain and strengthen environmental protection regimes of trading partners through a mix of soft law provisions and enforceable commitments that are supported by voluntary environmental cooperation initiatives aimed at building capacity of trading partners on a range of environmental issues if needed To simplify the discussion and review of the environmental policies, the policies were organized into four major categories, reflecting a mix of their substantive, constitutive, and operative nature: aspirational, cooperative, quasi-regulatory, and permissive Aspirational policies consist primarily of hortatory statements that in principle all trading partners should strive to achieve, such as providing for high levels of environmental protection Cooperative policies are used by the trading partners to pursue voluntary environmental cooperative initiatives to build their institutional capacity and strengthen their environmental protection regimes Quasi-regulatory policies are largely focused on maintaining or improving the enforcement of domestic environmental laws in the territories of the trading partners and are enforceable under the trade agreements using a state-to-state dispute resolution process Permissive policies typically define discretionary actions that the trading partners may take to enhance environmental protection or address specific environmental concerns associated with trade liberalization Overall, the number of policies in each category and their scope varied across trade agreements, although every trade agreement had at least one policy in each category Many of the existing environmental policies in the trade agreements can be traced back to NAFTA, whose policy framework has cast a long shadow over US trade policy Many, but not all of the NAFTA environmental policies have been carried forward to subsequent trade agreements, although some of policies that have been carried forward have been reformulated depending on the context within which it was negotiated At the same time, a few new policies to address emerging environmental concerns have been included in more recent trade agreements, indicating that policymakers are responsive to new concerns while still adhering strongly to past precedent As of 2017, the US and its trading partners had allocated upwards of $425 million to implement environmental policies under the US trade agreements, and the vast majority of the funding has been used to implement initiatives under the cooperative policies The number, type, and substantive Future of integration 117 focus of cooperative initiatives undertaken have varied widely across the trade agreements Overall, the assessment of cooperative policies revealed that they had some tangible impact on specific government actions or policies, but their impact overall on strengthening the environmental protection systems for US trading partners was quite limited The other major category of policies that received funding has been the quasi-regulatory policies, and the assessment indicated that these policies overall may have helped to redress particular instances of lax enforcement However, they have not resulted in macro-level changes to enforcement capacities or approaches, with one exception, the policies related to forestsector governance in the Peru trade agreement These policies have had a notable impact on strengthening Peru’s environmental protection regime for forests, although the policies still have not been fully implemented, and illegal logging and trade in illicit timber remains widespread in Peru At first glance, this overall conclusion that the environmental policies have had limited effectiveness may disappoint policymakers and call into question the credibility of the policies However, as a practical matter, it is unrealistic to expect wide-ranging transformations of trading partners’ institutions and capabilities for protecting the environment solely as a result of implementation of these environmental policies Rather, the policies should be viewed as one component of a larger constellation of bilateral, regional, and multilateral efforts to strengthen environmental protection in countries with weak or underdeveloped protection regimes At the same time, policymakers should also consider that the apparent limited effectiveness of the policies may reveal some hard truths, including shortcomings in policy design or the changing nature of the environmental concern or problem that gave rise to the policy in the first place Factors influencing policy effectiveness There are a wide variety of factors that influence policy effectiveness, and the following discusses several that have likely impacted the effectiveness of the environmental policies in US trade agreements These factors include levels of funding and other resources devoted to their implementation, the inherent design of the policy, the consistency between the policy and the problem that the policy was designed to address, and political commitment Understanding these factors can help guide policymakers for future policy integration and implementation Levels of funding are often cited as a key factor that influences policy effectiveness, and this claim certainly has merit It stands to reason that more money is better than less for policy implementation, all else being equal However, within the context of implementation of these policies for strengthening the environmental protection systems of primarily developing 118 Future of integration countries, there are practical limits to how much assistance a country can absorb within a given period of time The implementation of the NAFTA cooperative policies provides an illustrative example The early implementation of these policies focused intensely on a limited set of initiatives, such as the SMOC, which placed a high level of demand on government staff in the three countries, but especially Mexico, for particular regulatory programs The prolonged demand eventually led to “cooperation fatigue”, with diminishing returns on further investment of time and resources (Confidential Interviews MX-G-29; US-G-48; CN-G-16) The NAFTA environmental policies have received the most funding of any trade agreement, with $9 million per year (and over $200 million total) to support their implementation However, there have been widely diverging views on whether this level of funding is adequate given the size of the population and economies, geographic extent, and existing levels of regulation in the NAFTA countries Given that the NAFTA environmental policies were intended primarily to benefit Mexico, the governing factor in determining adequate levels of funding should be its ability to absorb the assistance As it has turned out, though a sizable portion of the funding has benefited the other two countries and, more importantly, has been used to support environmental initiatives that were undertaken merely because funding was available, providing more funding will not necessarily result in better policy outcomes Funding to implement the environmental policies for the other trade agreements has varied considerably, and it is likely that additional funding would improve policy effectiveness, especially for countries that have received very little funding on an annual basis, and in particular those countries that have received just enough funding to maintain an aura of implementation credibility However, it is difficult to determine the sufficient level of funding for any particular country without first conducting a thorough review of their capacity development needs and undertaking a more systematic approach to planning to meet those needs The current approach used for planning cooperative activities for many of the trade agreements appears to be very ad-hoc and opportunistic Additional funding under these circumstances may not result in better policy outcomes either The inherent design of the environmental policies and the consistency between the policies and the problems that the policies were intended to address are two other factors that influence policy effectiveness and will be discussed together, as they are integrally related for these environmental policies Many of the environmental policies included in US trade agreements were first crafted under NAFTA, at a time when there was a rudimentary understanding of the nexus between trade and the environment Since that time, it has become clear that the dire predictions of industry flight, pollution havens, and a race to the bottom for domestic environmental Future of integration 119 standards that environmentalists predicted would occur under NAFTA did not materialize Nonetheless, at that time, there was a general recognition that Mexico’s institutional capacity for environmental protection needed to be strengthened Thus, some but not all environmental policies crafted under NAFTA and carried forward into other trade agreements may be inconsistent with the perceived policy problems The cooperative policies, which are the centerpiece of the environmental policy portfolios, are flexible policy instruments that can be used to generally strengthen trading partners’ environmental protection regimes, and as such, there does not appear to be a consistency problem for these policies If a trading partner needs technical assistance to develop stronger environmental laws or regulations, compile baseline data on environmental conditions, train staff, upgrade laboratories, or establish animal rescue centers, the cooperative policies are sufficiently broad to address all of these needs Thus, the design of these particular policies should not limit the effectiveness of their implementation By contrast, the design of some quasi-regulatory policies is more problematic, such as the policy related to effective enforcement of environmental law This policy has been and remains the political touchstone for the environmental policy portfolios for all US trade agreements, but the conditions that trigger the enforcement of this policy have not materialized for US trading partners, obviating the need for the policy More importantly, even if the conditions did materialize, the countries would be loath to initiate the process and would rely instead on the cooperative policies to address the enforcement issues, as has been done for the obligations in the Peru trade agreement annex on forest-sector governance The design of the other quasi-regulatory policy associated with the public submission process has been problematic for other reasons For the public submission process under NAFTA, the policy for the process was open to interpretation, and this ambiguity has led to ongoing conflicts over implementation of the process between the NAFTA countries and between the countries and the CEC Secretariat As of 2017, the process was barely functioning, and it is unlikely that environmentalists will expend any political capital to return the process to a fully functional level In addition, the public submission process under both CAFTA-DR and NAFTA has been overly legalistic and time-consuming, also limiting its effectiveness Although the public submission process was envisioned as an easily accessible and responsive sunshine remedy, it has not turned out to be in practice This particular policy is simply not well-matched for the nature of the policy problem it is seeking to address The last quasi-regulatory policies that have been somewhat effective have been those in the forest-sector governance annex in the Peru trade agreement In general, these policies resulted in notable improvements in the capacity of Peru to manage its forests However, the policies have not been effective in actually reducing illegal logging and trade in illicit timber To 120 Future of integration some degree, the limited effectiveness is due in part to the policies design There is no question that the governance of the forest sector in Peru needs to be strengthened, but the inclusion of these types of policies in a trade agreement essentially transfers unilaterally the responsibility for policing a multilateral environmental agreement to the US, which it may be unable to successfully achieve The US has been able to strengthen the capacity of Peru forest management institutions, but the ability of Peru to continue to export illegally harvested timber to other countries severely limits what can be achieved unilaterally (Confidential Interview US-G-160) As such, it is likely that the US will need to move to another level, such as Asia-Pacific Economic Cooperation, to successfully implement these policies (Confidential Interview US-G-160) Political commitment is the last factor that influences the effectiveness of policies Even with the policies that are ideally suited to address the targeted problems and adequately funded, the policies are unlikely to be successful if there is no political commitment Overcoming a lack of political commitment, however, is a particular challenge for all policies, not just the environmental policies integrated into US trade agreements Nonetheless, the inclusion of these policies continuously reinforces the importance of environmental protection while also pursuing economic development and growth for US trading partners, which in turn should provide a positive feedback to build political commitment Policy recommendations Since NAFTA, the US has used a fairly standard approach to integrating environmental policy concerns into its trade policy This approach consists of including a portfolio of similar environmental policies in each trade agreement that deal with a broad range of issues Most of the environmental policies are legacy policies, first included under NAFTA and carried forward and modified slightly over time While these policies have been sufficient to ensure legislative approval of the trade agreements, the policies overall have had limited impact on strengthening the environmental protection regimes of trading partners While it is unrealistic to expect a sweeping transformation of these protection systems solely as a result of implementation of these environmental policies, the suite of policies can be updated to better reflect the contemporary understanding of the nexus between trade and environment Thus, rather than continue to replicate policies merely to achieve some academic sense of consistency across US trade agreements, changes to the policies should be made based on an empirically grounded assessment Based on the assessment presented in Chapter 3, several policy recommendations are offered for future integration of environmental policies into US trade agreements Future of integration 121 Identify bona fide trade-related environmental policy priorities The paramount question that needs to be asked is whether environmental policies are really needed within trade agreements, and the answer to that question depends on the potential environmental effects that arise when trade is liberalized Obviously, this question has been at the center of the trade and environmental debate for three decades, but definitive answers remain elusive Research indicates that it is very difficult to identify or predict specific environmental effects of trade liberalization ex ante Historically, the US has sought to identify these various types of environmental effects by completing an environmental impact assessment of its proposed free trade agreements (Exec Order 13141, 1999) However, these reviews are focused only on environmental impacts within the US, and the reviews completed by the US have not identified any significant environmental effects of any trade agreements for the US territory Identifying the potential environmental impacts of US trade agreements in the territories of the trading partners is the responsibility of each country Although sometimes the other countries complete their own environmental reviews and release the results to the public (see e.g Global Affairs Canada, n.d.), more often they not, and the US has no authority to compel them to so Thus, the US generally lacks a solid analytical basis to craft specific environmental policies for its trade agreements The more general academic literature on the environmental effects of liberalized trade likewise offers little guidance for crafting specific environmental policies for trade agreements The crux of the problem is that trade agreements in themselves not cause direct and immediate environmental damage; rather, environmental effects arise when economic activities associated with freer trade exacerbate unmitigated market or government failures As Kirkpatrick and Scrieciu (2008) note: [t]he environmental outcome of trade and investment liberalization is determined by a complex process of interdependent relationships, which are difficult to capture in an econometric or modelling framework The robustness of environmental policies and institutions, including the adequacy of supporting regulatory instruments, are important determinants of the environmental impacts of trade and investment liberalization Thus, the key to addressing any possible environmental effects is ensuring that trading partners have robust domestic environmental protection regimes In principle, the environmental policies included in US trade agreements are intended to just that However, in practice they have had limited impact on building institutional capacity, in part because of limited funding and in part due to ad-hoc and opportunistic planning in the absence of detailed 122 Future of integration assessments of institutional capacity-building needs In lieu of the current approach, a new approach could be pursued that requires completion of a comprehensive ex ante assessment of the institutional capacity of the US trading partners to protect the environment, along with the environmental review required under Executive Order 13141 Based on this capacity assessment, the US would determine if assistance is needed to strengthen the trading partners’ domestic environmental protection institutions If assistance is needed, it should be developed completely outside the context of the trade agreement and channeled through existing bilateral and multilateral programs Moreover, the assistance should be broad-based and well-funded, but with a sunset provision that will trigger a review of its effectiveness after a reasonable number of years For trading partners that already have robust environmental protection regimes, no assistance should be provided Get rid of the teeth Along with the changes to policies for strengthening the institutional capacity of trading partners, the US should eliminate all policies associated with effective enforcement of environmental laws, procedural guarantees, access to remedies, levels of protection, and the like from its trade agreements In other words, delete the environment chapters from the trade agreements Some of these policies address non-existent problems, and all of them are non-enforceable either in principle or in practice In general, these environmental policies merely create a green faỗade for the trade agreements and provide political cover for legislative approval As a practical matter, these policies are unlikely to ever contribute to the creation of the desired domestic environmental policies, institutions, and traditions because these are created endogenously, through political processes shaped by the particular social and economic context A commitment within a bilateral or regional trade agreement cannot substitute for the weight of history and long-standing political traditions of a country The only environmental policies that should be retained within the trade agreement are those embedded in other chapters and related to the privileging of trade-related measures within multilateral agreements over trade agreement rules and other policies intended to resolve the “conflict of rules” between trade rule and environmental laws This limited set of policies should serve as the core policies for integration of environmental policy into future US trade policy Address global environmental issues through other fora Some of the more recent trade agreements have included policies that require US trading partners to adopt, maintain, and implement as well as enforce environmental laws and regulations that fulfill obligations under multilateral Future of integration 123 environmental agreements or that prescribe specific obligations that are intended to address global environmental problems, such as overfishing in TPP or forest-sector governance in the Peru trade agreement These policies present a unique challenge to integrating environmental considerations into US trade policy In general, these global environmental problems have not been historically addressed in bilateral or regional trade agreements, but they have considerable merit and need urgent attention from the international community As such, bilateral or regional trade agreements provide a new forum for possibly addressing the issues However, there are several drawbacks to including policies to address these issues within the context of these trade agreements Most significantly, including these policies creates a parallel system for addressing global environmental problems outside of the existing multilateral system, and the policies transfer oversight to nonenvironmental government agencies, in particular trade agencies, that may not have the expertise or inclination to ensure effective implementation of the policies (see Allen, 2014) As such, it would be more appropriate to address these issues under the multilateral system to ensure uniformity at the global level or through a standalone environmental agreement not directly linked to a particular trade agreement The way forward The integration of environmental policies into NAFTA to address a wide range of hypothetical environmental concerns has cast a long shadow over US trade policy NAFTA was the first trade agreement to explicitly link trade policy with environmental protection goals to ensure that liberalized trade did not result in increased environmental degradation, and the environmental policies developed for NAFTA have endured and served as the template for subsequent US trade agreements However, 25 years on, it is clear that the effects of free trade on the environment are not as drastic or far-reaching as originally thought Thus, the inclusion of extensive environmental policies within trade agreements in general is no longer justified The US trade policy domain, however, marches on oblivious to this reality, and environmentalists and policymakers alike continue to advocate for the retention and strengthening of these environmental policies in US trade agreements The majority of environmental policies that have been integrated into US trade agreements are no longer needed Liberalized trade does have the potential to exacerbate unmitigated market or government failures, and thereby indirectly contribute to environmental degradation in a country However, the sine qua non for ensuring that this environmental degradation does not occur is strengthening institutional capacity of trading partners to protect the environment In general, the US has many long-standing 124 Future of integration bilateral and multilateral programs to build institutional capacity of less developed countries, and these programs can easily be expanded To identify instances where additional capacity is needed, the US should complete a comprehensive ex ante assessment of the institutional capacity of its trading partners and then provide broad-based and long-term assistance to strengthen the capacity This assessment, along with a small set of core environmental policies focused on a conflict of rules, should be the focus of the new policy approach for addressing potential environmental effects of trade liberalization Bibliography Note: Confidential interviews were conducted in 2000, 2001, 2002, 2003, 2004, 2005, 2011, and 2018 with individuals involved in policy implementation All interviews were confidential to obtain candid responses and protect the identity of the interviewees Interviews are cited using the organizational affiliation (government = “G”, CEC = “C”, private sector = “P”, academia = “A”, nongovernmental organization = “N”) and nationality of interviewee (Mexican = “MX”, United States = “US”, Canadian = “CN”, and other = “OT”) and a chronologically assigned number for the interview: ex MX-G-25 Allen, L J (2014) Trade and environment: A new direction for green trade The Estey Centre Journal of International Law and Trade Policy, 15(1), 47–65 Executive Order 13141 (1999) Environmental review of trade agreements Retrieved from www.presidency.ucsb.edu/ws/index.php?pid=56947 Global Affairs Canada (n.d.) Canada-Ukraine Free Trade Negotiations Retrieved from www.international.gc.ca/trade-agreements-accords-commerciaux/env/final_ ea_canada-ukraine_ee.aspx?lang=eng Kirkpatrick, C., & Scrieciu, S S (2008) Is trade liberalisation bad for the environment? A review of the economic evidence Journal of Environmental Planning and Management, 51(4) Lallas, P L (1993) NAFTA and evolving approaches to identify and address ‘indirect’ environmental impacts of international trade Georgetown International Environmental Law Review, 5: unpaginated, on-line, LexisNexis Office of the US Trade Representative (n.d.) Environmental reviews Retrieved from https://ustr.gov/issue-areas/environment/environmental-reviews Index Note: Page numbers in bold indicate tables on the corresponding pages Allen, L J 66, 92 aspirational policies 27–28, 39–40; effectiveness of 63; specific language for 46–47 assessment, methodology for policy 56–59 Australia trade agreement: aspirational policies and 39; cooperative policies and 41; environmental side agreement work plans 60; institutional structures for environmental policy implementation 36; oversight bodies 61; permissive policies and 45; quasi-regulatory policies and 43 Bahrain trade agreement: aspirational policies and 39; cooperative policies and 41; environmental side agreement work plans 60; institutional structures for environmental policy implementation 36; oversight bodies 61; permissive policies and 45; quasi-regulatory policies and 43 Bipartisan Agreement, May 2007 9, 10; environmental negotiating objectives in 17–18 Bipartisan Congressional Trade Priorities, 2015 9, 10; environmental negotiating objectives in 18–20 Block, G 65 Border Environment Cooperation Commission (BECC) 7, 63–64 Bush, George H W 7, 9, 11, 15–16 CAFTA-DR 11, 27; aspirational policies and 39; cooperative policies and 41, 78–84, 79–82; effectiveness of policies under 78–84, 79–82; enforcement of environmental laws and public submission process and 92–94; environmental policy implementation and 59; environmental side agreement work plans 60, 61; institutional structures for environmental policy implementation 36; methodology for policy assessment for 58; oversight bodies 61; permissive policies and 45; quasi-regulatory policies and 33, 43 Canada-US Free Trade Agreement (CUSFTA) categorization, policy 26–27 Chile trade agreement: aspirational policies and 39; cooperative policies and 41; environmental policy implementation and 60; environmental side agreement work plans 60; institutional structures for environmental policy implementation 36; oversight bodies 61; permissive policies and 45; quasi-regulatory policies and 43 Colombia trade agreement 36; aspirational policies and 40; cooperative policies and 42; environmental side agreement work plans 60; oversight bodies 62; permissive policies and 45; quasiregulatory policies and 44 126 Index Commission for Environmental Cooperation (CEC) 64, 65, 66, 71, 72, 74 Convention on International Trade in Endangered Species (CITES) 11; cooperative policies and 86; permissive policies and 96; quasiregulatory policies and 33 cooperative policies 28–30, 41–42; CAFTA-DR 78–84, 79–82; effectiveness of 63–90; NAFTA 63–78, 64, 66, 100–106; Oman trade agreement 86–88, 87; Peru trade agreement 84–86, 85; Singapore trade agreement 88–90, 89; specific language for 47–48 and their effectiveness 116–117; recommendations for 120–124; side agreement work plans 60, 60–61; trade policy integration with 5, 5–12, 10 environmental side agreements (ESA) 26 Fallon, J E 66 fast-track authority 4, free trade agreements (FTA) 5, 26; “greening” of 25, 115 General Agreement on Tariffs and Trade (GATT) 5, 6; permissive policies and 35 “greening” of US free trade agreements 25, 115 dispute resolution 90–91 effectiveness, policy 62–63, 116–117; aspirational 63; CAFTA-DR 78–84, 79–82; cooperative 63–90; factors influencing 117–120; NAFTA 63–78, 64, 66; Oman trade agreement 86–88, 87; permissive policies 96; Peru trade agreement 84–86, 85; quasi-regulatory 90–95; Singapore trade agreement 88–90, 89; summary of 96–99 enforcement of environmental laws and state-to-state dispute resolution and 90–91 Environmental Enforcement and Compliance Cooperation Working Group (EWG) 73–74, 77 environmental policies 25–26; aspirational 27–28, 39–40, 46–47, 63; categorization of 26–27; cooperative 28–30, 41–42, 47–48, 63–90; effectiveness of (see effectiveness, policy); implementation of 59–62, 60, 61–62; institutional structures for implementation of 35, 36–38; methodology for assessment of 56–59; need for review of 12–13; oversight bodies 61–62, 61–62; overview of 27–35; permissive 34–35, 45, 51–52, 96; quasi-regulatory 30–34, 43–44, 48–50, 90–95; recap of major, implementation of environmental policies 59–62, 60, 61–62 institutional structures for policy implementation 35, 36–38 Jacott, M 76 Johnson, R 66 Jordan trade agreement 11; aspirational policies and 28, 39; cooperative policies and 41; environmental side agreement work plans 60; institutional structures for environmental policy implementation 36; oversight bodies 61; permissive policies and 45; quasi-regulatory policies and 43 Kalinina, M 93 Kirkpatrick, C 121 Knox, J H 26 Lurié, A 93 methodology for policy assessment 56–59 Morocco trade agreement 30; aspirational policies and 39; cooperative policies and 41; environmental policy implementation and 60; environmental side agreement work plans 60; institutional structures for environmental policy Index implementation 36; oversight bodies 61; permissive policies and 45; quasi-regulatory policies and 43 North American Agreement on Environmental Cooperation (NAAEC) 7, 64–65; North American Bird Conservation Initiative (NABCI) and 70–73; Sound Management of Chemicals (SMOC) and 67–70; state-to-state dispute resolution and 90–91 North American Bird Conservation Initiative (NABCI) 70–73 North American Development Bank (NADBank) 7, 64 North American Free Trade Agreement (NAFTA) 1–2, 4, 25; aspirational policies and 28, 39; cooperative initiatives, 1995–2010 100–103; cooperative initiatives, 2011–2016 104–106; cooperative policies and 29–30, 41, 63–78, 64, 66; effectiveness of policies under 63–78, 64, 66; enforcement and compliance cooperation forum 73–75; enforcement of environmental laws and public submission process and 92–94; environmental effects program 75–76; environmental policy implementation and 59; environmental protections and 6–9, 10; environmental side agreement work plans 60, 61; factors influencing policy effectiveness under 118–120; G H W Bush administration environmental commitments for 15–16; “greening” of 115; institutional structures and 35, 36; methodology for policy assessment for 58; North American Bird Conservation Initiative (NABCI) and 70–73; other cooperative initiatives and 76–77; oversight bodies 61; permissive policies and 34, 45, 96; policy categorization and 26–27; policy recommendations and 120–124; quasi-regulatory policies and 31–33, 43; Sound Management of 127 Chemicals (SMOC) and 67–70; specific language for aspirational policies and 46, 46–47; specific language for cooperative policies and 47; specific language for permissive policies and 51; specific language for quasi-regulatory policies and 48, 48–50; summary of cooperative policies under 77–78; Trump administration negotiations on 12, 20–21 North American Waterfowl Management Plan (NAWMP) 70, 71, 72 North American Wildlife Enforcement Working Group (NAWEG) 73–75 Obama, Barack 12 Oman trade agreement: aspirational policies and 39; cooperative policies and 41, 86–88, 87; environmental side agreement work plans 60; institutional structures for environmental policy implementation 36; methodology for policy assessment for 58; oversight bodies 61; permissive policies and 45; quasi-regulatory policies and 43; specific language for aspirational policies and 47; specific language for cooperative policies and 47; specific language for permissive policies and 52; specific language for quasiregulatory policies and 49 Organization for Economic Co-operation and Development 83 Organization of American States (OAS) 78, 83 oversight bodies 61–62, 61–62 Panama trade agreement: aspirational policies and 40; cooperative policies and 42; environmental side agreement work plans 60; institutional structures for environmental policy implementation 36; oversight bodies 62; permissive policies and 45; quasi-regulatory policies and 44 permissive policies 34–35, 45; effectiveness of 96; specific language for 51–52 128 Index Peru trade agreement 33; Annex on Forest Sector Governance under 57, 94–95, 99; aspirational policies and 40; cooperative policies and 42, 84–86, 85; environmental side agreement work plans 60; institutional structures for environmental policy implementation 36; methodology for policy assessment for 58; oversight bodies 62; permissive policies and 45; quasi-regulatory policies and 44, 94–95; specific language for aspirational policies and 47; specific language for cooperative policies and 48; specific language for permissive policies and 52; specific language for quasi-regulatory policies and 49–50 policy recommendations 120 pollution havens 7, 118 public submission process 92–94 quasi-regulatory policies 30–34, 43–44; effectiveness of 90–95; enforcement of environmental laws and public submission process and 92–94; enforcement of environmental laws and state-to-state dispute resolution and 90–91; Peru annex on forestsector governance 94–95; specific language for 48–50 Reciprocal Trade Agreements Act (RTAA) of 1934 3, recommendations, policy 120–124 Reed, C 76 Renegotiation Objectives for NAFTA, 2017 10 Sauer, J R 66 Scrieciu, S S 121 side agreement work plans 60, 60–61 Singapore trade agreement: aspirational policies and 39; cooperative policies and 41, 88–90, 89; environmental side agreement work plans 60; institutional structures for environmental policy implementation 36; methodology for policy assessment for 58; oversight bodies 61; permissive policies and 45; quasi-regulatory policies and 43 social costs of freer trade Sound Management of Chemicals (SMOC) 67–70 South Korea trade agreement: aspirational policies and 40; cooperative policies and 42; environmental side agreement work plans 60; institutional structures for environmental policy implementation 36; oversight bodies 62; permissive policies and 45; quasi-regulatory policies and 44 state-to-state dispute resolution 90–91 trade: policymaking on 3–4; social costs of freer Trade Act of 1974 3–4 Trade Act of 2002 8–9, 10, 11; environmental negotiating objectives in 16–17 trade agreements, US: free (FTA) 5; “greening” of 25, 115; integration of trade and environmental policy in 5, 5–12, 10; introduction to 1–2; need for review of environmental policies in 12–13 Trade Promotion Agreements (TPA) trade promotion authority 8–9, 12 Trans-Pacific Partnership (TPP) 9; aspirational policies and 40; cooperative policies and 29, 42; institutional structures for environmental policy implementation 36; permissive policies and 34–35, 45; policy categorization and 26–27; quasi-regulatory policies and 32, 33, 44 Trump, Donald 9, 12, 20–21 Vaughan, S 26 Winfield, M 76 work plans 60, 60–61 ... Act of 1979 and Trade, Tariff Act of 1984 Omnibus Trade and Competitiveness Act of 1988 n/a Trade Act of 2002 Trade Act of 2002 Trade Act of 2002 Trade Act of 2002 Trade Act of 2002 Trade Act of. . .The Greening of US Free Trade Agreements This book provides an up-to-date critical analysis of the integration of environmental policies into US free trade agreements The work focuses on the. .. the overall process for crafting and enacting trade policy in the US as well as the increased awareness of the social costs of trade liberalization in the 1980s Trade policymaking in the US The