“New NAFTA” fails to protect environment
On Oct. 1, Canada woke up to Trudeau’s signing of the United States-Mexico-Canada (USMCA) Trade Agreement, amicably referred to as the new North American Free Trade Agreement (NAFTA), or NAFTA 2.0. Now, whether or not “new” also means “improved” is open to debate, but not for Donald Trump. Early that morning, the POTUS was already crowing to his Twitter followers that this “great deal” fixes the mistakes made in NAFTA and will help North America be more globally competitive. Similarly, Justin Trudeau took to Twitter to announce that the USMCA Agreement is good for the middle class and creates more jobs and opportunities for Canadians.
What both leaders failed to comment on in their tweets was how USMCA completely disregards how the trade agreement relates to climate change, a factor that is rapidly changing the trade landscape in North America and across the world.
According to EcoWatch, USMCA not only benefits the fossil fuel industry, but also severely limits the ability of the government to enforce environmental protections. The director of economic policy at Friends of the Earth, Doug Norlen, told the Huffington Post that “this agreement is an attack on our ability to hold Big Oil and Gas accountable for the damage they cause to our communities.”
In case you need a refresher: NAFTA is a 1994 agreement between Canada, the United States, and Mexico to remove trade barriers between these countries. The removal of these barriers (largely tariffs on imported goods) fostered investment across borders and generally improved the countries’ economies. However, Donald Trump promised to scrap NAFTA during his presidential campaign, as the post-NAFTA economy saw the loss of approximately 800,000 American jobs to Mexico, according to CNN Business. Ironically, this “loss” was implicit in the goals of the agreement, as under NAFTA, U.S. and Canadian citizens and industries benefit greatly from cheap labour and goods produced in Mexico.
Regardless of why the trade deal renegotiation was instigated, this opened the door for discussions around how the fossil fuel industries that benefit from NAFTA contribute to global climate change. Instead of incorporating provisions that would limit fossil fuel output, USMCA makes no mention of climate change. Instead, like NAFTA, USMCA still allows corporations to challenge environmental regulations through the Investor-State Dispute Settlement (ISDS) process. Through ISDS, foreign companies can sue a government for alleged discriminatory practices. This means that if the Canadian government were to pass legislation that protects the Canadian environment at the expense of a U.S. or Mexican corporation with vested interests in Canada, that foreign corporation can sue the Canadian government for discrimination. According to a 2015 study by the Canadian Centre for Policy Alternatives, Canada was liable for over $6 billion and had already paid out over $172 million in alleged damage through ISDS claims. Although the ISDS process has been highly criticized for years, USMCA will continue to allow U.S. oil and gas companies to sue the Mexican government, even though they can no longer sue the Canadian government.
In addition, although USMCA acknowledges that air pollution is a public health concern, as Sierra Club executive director Michael Brune told the National Observer, USMCA also “fails to include a single binding rule to reduce the air pollution that NAFTA has exacerbated.”
One good outcome of this agreement is that under the terms of USMCA, Canada is no longer required to export a designated percentage of its energy production to the United States. For a long time, this export requirement impeded Canada’s ability to move away from reliance on fossil fuels in order to meet the export quota. However, USMCA still needs to be ratified by all three countries, so the earliest it can come into force is 2020.
Naturally, I was disappointed with the lack of environmental responsibility demonstrated by USMCA signatories, especially in light of the recent report from the Intergovernmental Panel on Climate Change (IPCC). This report claims that based on current levels of greenhouse gas emissions, the planet will likely reach the critical 1.5 degree Celsius threshold set in the Paris Agreement in the next 12 years. The report also highlights how surpassing this threshold would dramatically worsen the impact of natural disasters, including extreme drought, wildfires, floods, and food shortages. Trade agreements that ignore climate change and their contribution to it will only compromise our ability to reach these targets as a society, and will inevitably cause more harm than good.
Writer’s note and disclaimer: My name is Ella; I’m a U of G alumna, and I intern for Elizabeth May — MP for Saanich-Gulf Islands and the leader of the Green Party of Canada (GPC). As Ms. May’s intern, I attend parliamentary committees, correspond with constituents, attend legislative affairs, and work closely with her legislative assistants. The catch is, I have no prior experience with or knowledge of politics. This column details my experiences learning about the political culture and proceedings on Parliament Hill. My views are my own, and do not represent those of the GPC or of The Honourable Elizabeth May, MP.
Photos Courtesy of CBC