Australian Conservationists Warn Against USA Free Trade Pact

CANBERRA, Australia, May 7, 2004 (ENS) - The U.S.-Australia Free Trade Agreement will be signed on May 18 in Washington, DC, representatives of both countries said this week. Both trade representatives say they are pleased with the economic opportunities opened up by the agreement, but Australia's largest conservation organization warns that the deal threatens Australia's existing environmental laws and fetters future Australian governments seeking to legislate to protect the environment and social welfare.

U.S. Trade Representative Robert Zoellick will sign the pact on behalf of the United States and Australian Minister for Trade Mark Vaile will sign on behalf of Australia. This is the first Free Trade Agreement between the United States and a developed country since the U.S.-Canada Free Trade Agreement in 1988.

Australian Minister for Trade Mark Vaile (left) and U.S. Trade Representative Robert Zoellick in Washington at the opening of discussions on the FTA. January 26, 2004. (Photo courtesy Australian Ministry of Trade)

The text of the U.S.- Australia Free Trade Agreement (FTA) was concluded on February 8 and five days later President George W. Bush notified Congress of his intent to enter into the agreement.

"We're excited about the opportunities an FTA with Australia will provide our exporters, and we're pleased with recent statements of support from Members of Congress," said Zoellick. "The May 18 signing date between trade ministers offers the earliest possible date for us to move forward in consultation with Congress."

Australian Prime Minister John Howard will be in Washington in June and will try to persuade any reluctant U.S. lawmakers that the deal is in the best interests of both countries. "There are Democrats who are against it and there are Republicans who are against it, but there are Republicans and Democrats both in favor," Howard told the Australian Broadcasting Corporation Wednesday. "It is important that I go there and talk to them directly and that I hope will make a difference."

Some legislators from rural U.S. states are being pressured by their constituents not to permit free access to the U.S. market for Australian agricultural products. Some Australians say it favors U.S. exporters. The Howard government has had to compensate sugar growers with a four-year, A$440 million rescue package after sugar was excluded from the deal.

Last week a report by the Australian Centre for International Economics (CIE) estimated the agreement would add over A$6 billion annually to the Australian economy after 10 years of operation.

“At the time I had no doubt the deal we negotiated in Washington was in the national interest,” Vaile said. The economic analysis by CIE "backs this judgement.”

The CIE reports that more than 40,000 Australian jobs will be created and real wages will rise and all states and territories will benefit.

An Australian sheep rancher at lambing time. (Photo courtesy Friends of Australia Congressional Caucus)

The U.S. too will benefit economically, Zoellick said. Australia purchases more goods from the United States than from any other country, and the U.S. enjoys a bilateral goods and services trade surplus of $9 billion. Australia is a key export market for important U.S. manufacturing sectors such as aircraft, autos and auto parts, machinery, computers and electronic products, chemicals, and wood and paper products. Each of the 50 U.S. states exports to Australia, particularly Washington, California, Illinois, Texas, Michigan, New York, Ohio, Pennsylvania, and Florida.

The Australian Parliament's Joint Standing Committee on Treaties is currently undertaking hearings around Australia and is due to report in June to allow passage of enabling legislation through Parliament in August.

But the Australian Conservation Foundation's analysis of the 1,000 page agreement on environmental grounds has alarmed the nonprofit, environment group headed by president Peter Garrett and executive director Don Henry.

They say that the potential environmental impacts of this agreement "have not been formally assessed," and "many serious questions about the environmental consequences" of the pact remain unanswered. For these reasons, the foundation is urging Parliament to refuse to pass enabling legislation for the deal.

The FTA Investment Chapter obliges the Commonwealth Government to compensate U.S. investors if Australian laws on the environment, human rights or labor standards "significantly interfere" with their investments. This provides greater rights to U.S. investors than are currently enjoyed by Australians under the Australian legal system. If this obligation is breached, the U.S. government will have the right to seek compensation, the foundation warns.

The Olgas, one of Australia's most famous environmental icons. Located 48 kilometers from world-famous Ayers Rock, they stand about 200 meters taller and are 36 individual domes. (Photo courtesy Friends of Australia Congressional Caucus)

The foundation compliments Australian negotiators for not having made concessions allowing the removal of Australian laws governing the disclosure of genetically modified ingredients. Still, the group points out, it would still "always be open for the U.S. to challenge the validity of these laws through the WTO [World Trade Organization] as they have European laws." The United States has a current case against the European Union's de facto ban on genetically modified crops underway at the WTO.

Several of the foundation's reservations are based on what Australia has not done. Australia has not undertaken an environmental impact assessment of the FTA. "Consequently, we lack assessment of the potentially significant environmental impacts arising from increased agricultural exports from Australia, and from the increased importation into Australia of a wide range of products," the foundation cautions.

Australians have no public process to review or recommend amendments to the FTA draft text, the group points out. Unlike Congress, with its right of veto, the Australian Parliament cannot vote on the FTA. Parliament cannot stop the agreement from being signed by the Australian Prime Minister if it determines the FTA is not in the national interest.

"The sole, weak course of action available to the Parliament is to block any enabling legislation required to implement the agreement - after it is signed - at the domestic level. This blatantly undemocratic situation requires immediate attention and reform," the foundation says, urging Parliament not to pass enabling legislation for the agreement.

View the full text of the Australia-United States Free Trade Agreement online at: http://www.dfat.gov.au/trade/negotiations/us_fta/text/index.html

Read the Australian Conservation Foundation's analysis of the agreement online at: http://www.acfonline.org.au/docs/general/00521.pdf