On its 20th Anniversary, Criticism of NAFTA for Environmental, Economic Damage

A new report from the Sierra Club, the Council of Canadians and others, condemns the North American Free Trade Agreement (NAFTA) for failing to improve economic and environmental conditions for most Canadian, American, and Mexican citizens.

According to the report, exports from Canada to the U.S. increased by 200 percent from 1994 to 2008, yet wages stagnated. Further, NAFTA contract obligations for oil encouraged development of the oil sands, while alternative energy sectors suffered, and NAFTA restricted Canada’s ability to regulate oil sands emissions. Pollution increased in the U.S. due to growth in dirtier manufacturing sectors, although employment in American manufacturing dropped overall.

In Mexico, small farmers were unable to compete with large-scale, export-oriented intensive agriculture. Many failed in attempts to improve profits by converting carbon-sequestering forest to arable land. While the mining industry in Mexico did enjoy a boom, smallholders lost out to associated industrial pollution. Wages in the maquila manufacturing sector near the U.S. border simultaneously stagnated, even as operations and pollution levels grew.

Other environmental impacts noted by the report include a significant jump in North American greenhouse gas emissions, unsustainable water use, and the rippling effects of NAFTA clauses that provide corporations with legal avenues to challenge environmental regulations, such as Lone Pine Resources’ ongoing lawsuit against Canada over the Québec fracking moratorium (see our previous report at: https://workandclimatechangereport.org/2013/11/22/fracking-company-suing-for-lost-profits-in-quebec/).

See NAFTA: 20 Years of Costs to Communities and the Environment at: http://www.sierraclub.ca/en/main-page/new-report-reveals-environmental-costs-north-american-free-trade-agreement-environmental-d, and “NAFTA Report Warns of Trade Deal Environmental Disasters” from the Huffington Post at: http://www.huffingtonpost.com/2014/03/11/nafta-environment_n_4938556.html.

Fracking Company Suing for Lost Profits in Québec

On September 6, 2013 Lone Pine Resources quietly submitted its formal request for arbitration against Canada, arguing that Québec’s moratorium against fracking deprives Lone Pine of its right to profit in the Saint Lawrence Valley. Under NAFTA rules, the case will be argued in front of a panel of 3 judges. The Notice of Arbitration is available at: http://www.international.gc.ca/trade-agreements-accords-commerciaux/assets/pdfs/disp-diff/lone-02.pdf.

Proposed Terms of the Comprehensive Economic and Trade Agreement (CETA) Could be Used to Challenge Canadian Fracking Bans

A May 6 briefing by Corporate Europe Observatory, the Council of Canadians and the Transnational Institute “highlights the public debate around fracking, the interests of Canadian oil and gas companies in shale gas reserves in Europe, and the impacts an investment protection clause in the proposed CETA could have on governments’ ability to regulate or ban fracking.”   A similar provision investment protection clause in the North American Free Trade Agreement (NAFTA) is the basis for a current challenge by Lone Pine Resources to a fracking moratorium in Quebec. See the briefing, The Right to Say No: EU-Canada Trade Agreement Threatens Fracking Bans (May 6) at  http://corporateeurope.org/publications/right-say-no-eu-canada-trade-agreement-threatens-fracking-bans .