January 28,2004

Baucus Lauds Important Progress in Addressing Environmental Issues in the Central America Free Trade Agreement, Notes Outstanding Concerns

(WASHINGTON, D.C.) U.S. Senator Max Baucus, ranking member of the Senate Finance Committee, which has responsibility for free trade agreements, today released the followingstatement, praising the ongoing efforts to strengthen environmental provisions in the United States-Central America Free Trade Agreement (CAFTA). Text of the CAFTA agreement was publiclyreleased this afternoon.

“I have long been an advocate of trade agreements that open markets, level the playing field,and create new opportunities for American farmers, workers, and businesses. Experience shows thatwhat works to achieve those goals can be different for different countries. In other words, with FreeTrade Agreements (FTA), one does not fit all.

In the case of the CAFTA, we are breaking new ground. We are negotiating with countrieswhose levels of economic and political development differ significantly from the United States’other FTA partners. One area where this is particularly apparent is environmental standards.Environmental laws and enforcement mechanisms are not yet well developed in many of theCAFTA countries. That means the same environmental provisions that worked in our recentagreements with Singapore and Chile aren’t enough for the CAFTA. We need to do more.

For the last several months, I have been working with the Administration, the environmentalcommunity, business, and the CAFTA governments to craft a package of measures to strengthen theenvironmental provisions in the CAFTA over those in prior agreements. I am pleased to say thatprogress is being made.

One of my priorities has been to create a citizen submission process in the CAFTA. Thiskind of process, which has been used successfully under the North American Free Trade Agreement(NAFTA), would allow individuals and environmental groups to directly challenge the failure ofany CAFTA government to effectively enforce its environmental laws and seek a detailed, factualreport from an independent expert body.

I am pleased to see that, as a result of my proposal, the CAFTA now contains a citizensubmission process modeled on the NAFTA. I worked hard to ensure that the CAFTA citizensubmission process contains several important improvements over the NAFTA procedure: itnarrows the grounds on which submissions can be rejected; permits a submission to go forwardbased on the request of any single party; and provides for recommendations on how to addressproblems identified in the factual report through the Environmental Cooperation Agreement.

Although the formal negotiations for the CAFTA are now completed, much work remains tobe done before the agreement comes before Congress. We need to identify an independent andexpert institution to serve as the secretariat for the citizen submission process. My proposal for theCAFTA also addresses a number of other areas. We need to strengthen the agreement’s provisionson multilateral environmental agreements and corporate stewardship. We need to sketch out thedetails of the appellate mechanism for investor-to-state disputes that is mandated in the Trade Act of2002 – not just promise to think about it later. We also need to improve the capacity building andcooperation provisions for environment and labor by providing for coordinated long-term planning,benchmarking of progress toward planning goals, and objective monitoring, and by creating a stableand dedicated source of funding for cooperative activities.

Like many Members of Congress, I want to make a decision about the CAFTA based on thecomplete package. At this point, too much remains unresolved to make a full assessment of theagreement. I am very pleased that the Administration was able to finalize an agreement with CostaRica, the region’s largest market. That said, negotiations are not yet completed with the DominicanRepublic. And, while the CAFTA text has just been made public, there are still some details thatneed to be finalized. More broadly, we need to be sure as we prepare to consider the CAFTA that allthe commitments made in the Trade Act of 2002 – including Trade Adjustment Assistance – arebeing fulfilled.

I am optimistic that we can address all these issues prior to Congressional consideration ofCAFTA implementing legislation, but it will take hard work. I remain committed to working withthe Administration and our trading partners to make the CAFTA a strong and forward-leaningagreement that can garner broad Congressional support."