Corruption Ruins Ability to Protect Environment
Copyright (c) 2001 Canadian Institute for Business and the Environment, Montreal & Toronto
THE GALLON ENVIRONMENT LETTER
506 Victoria Ave., Montreal, Quebec H3Y 2R5
Ph. (514) 369-0230, Fax (514) 369-3282
mail ggallon@pcstarnet.com
Vol. 5, No. 19, May 12, 2001
Graft and corruption are ruining the ability of countries to protect their environment. Corruption makes it impossible for countries to implement pollution controls, manage their renewable resources (forests and fisheries), and to protect their wildlife and biodiversity. Countries can have the best environmental laws and the best functioning ministries of environment. But when graft and corruption permeates their economy, government efforts can easily give way to lethargy, lack of funds, and the growth of resource mismanagement. It is hard enough to encourage governments to focus on the long-term needs to protect the environment. Normally politicians cannot think past the next budget or past the next election. But when civil society caves into to corruption, environmental protection suffers. It is when governments, or the companies that service them, become corrupt, that protection of the environment fails and the husbanding of natural resources gives way to plunder. When corruption becomes excessive a number of corroding activities take place:
o bribes are paid by polluters to have the environmental enforcement agencies look the other way - - pollution continues unabated
o bribes are paid and local officials are coerced into participating in the illegal logging of protected forests and in the over-fishing of protected fisheries
o large grants and low-interest loans are sought from the World Bank, IMF and OECD countries to build pollution control infrastructure such as sewage treatment plants, industrial wastewater plants, air pollution baghouse scrubbers for coal-fired electricity plants, and the money is stolen, misappropriated, resulting in either the collapse of the project, or in such poor construction as to make the facilities inoperable
o bribes are paid to officials to turn their heads and allow the disposal of toxic wastes in unapproved areas such as rivers, ravines, and lakes
o professional staff and trained officials give up in carrying out their duties, at the least; at the worst, non-corrupt officials become complacent or become involved in corruption; the system breaks down
Look at Russia and the Ukraine - - two of the most environmentally degraded countries in the world. Broken by corruption and driven by graft, it is almost impossible for Russia and the Ukraine to pay for environmental clean up that they so desperately need. Countries like Poland and Greece are doing a better job. Even when the World Bank and other development agencies pour money into Russia and the Ukraine to build sewage treatment plants and clean up nuclear waste, the money leaches out quicker than PCB's through porous soil. Visit the website for the Anti-Corruption Network at
http://www.nobribes.org/ .
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CORRUPTION OVER 15 PERCENT, COLLAPSES A NATIONAL ECONOMY
Corruption is common amongst humans within human institutions. You can find it practiced in the best of countries, and within different types of systems - - democracies, communists, dictatorships, etc. The United States, Germany, England, and Canada all have certain levels of corruption. There are laws and enforcement agencies within institutions to keep corruption in check. China, for example, is executing people as it tries to rein-in rampant corruption. It appears, from empirical evidence, that countries can survive and systems can work when corruption remains within 5 to 15 per cent of the cost of doing business, or within the cost of building societal infrastructures such as transportation systems, energy systems, and water and wastewater treatment systems. Low levels of corruption do not bleed countries of the hard currency they need to maintain their economies. High levels of corruption, like cancer, choke the life out of the economy, as the life-blood of cash is diverted away from national productivity to Swiss bank accounts. When corruption starts to eat into more than 20 per cent of project or business income of a nation, the project is stalled, or completed so poorly as to put the users at risk, e.g., crumbling highways, shaky bridges, unreliable power plants, etc. Corruption becomes so bad that those who were not participating in it, join in. Everyone grabs at the brass ring on the Merry-Go-Round. Investment money flees. Honesty in business disappears. Eventually the basic morale and economic fibre of a country rots and falls as bits of detritus on the streets. That is what has happened in Nigeria. And this is what is happening in Kenya.
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CORRUPTION IN KENYA
For example, for the four years that I was in Nairobi, Kenya (1977- 1981), I witnessed "manageable" corruption in that nation that was less than 15 percent of the total cost of doing business. It was problematic. It was illegal. But it was not debilitating. Kenya was flourishing. It was becoming the Switzerland of Africa. International agencies were locating their African headquarters there. Corporations established their head offices there. There was a strong commerce and an improving lifestyle for its people, accompanied by a fair judicial system. However, under President for Life, Daniel Arap Moi, Kenya sunk into an economic quagmire caused by rampant corruption - - led by the president and his family. Corruption in Kenya has killed or stalled projects. It has stripped the country of hard currency with which to purchase imported materials such as chemicals, oil, and manufactured goods.
In an attempt to reduce the corruption in Kenya to acceptable levels senior officials from the World Bank and the International Monetary Fund (IMF) met with President Moi in February 2001, to set new parameters before the next set of loans to Kenya from these institutions. In July 1997, the Government of Kenya refused to meet commitments made earlier to the International Monetary Fund (IMF) on governance and corruption reforms. As a result, the IMF suspended its Enhanced Structural Adjustment Facility (ESAF) with Kenya that totaled $218 million. The World Bank also put a $90-million structural adjustment credit (SAC) on hold. To date, Kenya has not fully met conditions to negotiate a new ESAF or SAC. Source, http://www.state.gov/www/background_notes/kenya_0398_bgn.html .
The Berlin-based anti-corruption group, Transparency International, listed Kenya as one of the world's most corrupt places to do business. The Public Accounts and Public Investments committees of the Kenyan Parliament regularly list boondoggles that benefit companies openly owned by President Daniel Arap Moi's associates or his family. Every year, the nation's auditor general tallies huge amounts of misappropriated government money. Just as routinely, no charges were filed and no corrective measures were taken. "Almost always, nothing happens," said a Western diplomat based in Nairobi. "No steps were taken. Corruption in this East African country of 29 million is no secret."
Kenya has 1,200 development projects going, and its target is to complete 25 percent each year. In fact, it is completing only 3 percent per year due to the loss of money and the delays created by corruption.. "Corruption is entrenched very much. The system is such that everybody is involved." said Chandaria, who owns a group of companies that make building products in Kenya. Everybody from police working roadblocks to bureaucrats issuing routine documents expects bribes. Anything is available, at a price. The president's youngest son, Gideon, is frequently cited as a shareholder in companies that do business with the government. He is part owner of an elevator company that is said to install and repair the lifts in all government buildings.
In the most celebrated case of corruption, the government paid $100 million to the Goldenberg International company in 1991 and 1992 as an incentive for exports of gold and diamonds, even though Kenya produces little gold and no diamonds. All told, the series of scams known as the Goldenberg scandal cost the government 21 billion shillings _ about $400 million, or about 20 percent of the government budget in 1993.
"How does corruption affect Kenya?" asked U.S. Ambassador Prudence Bushnell at a Rotary Club speech in Mombasa in 1997. She said, "Kenyan people point to the deteriorating quality of their roads, the piles of garbage, and the power outages, as signs of corruption in their country.
The U.S. Ambassador added that, "they talk about officials, from police in the streets to leaders in government and industry, who openly flout the law with impunity. They tell me about land grabbing, about questionable construction projects, and about money stuffed in secret accounts in off-shore banks, lost to local investment. And they talk with discouragement about cases lingering in the courts and public officials shifted to other jobs rather than held to account." Shealso said that corruption frightened away foreign investors, especially American businesses that are forbidden from bribing foreign officials. Source, "Corruption, entrenched in Kenya, is Central Election Issue", by Andrew Maykuth, Nairobi, The News-Times,
Knight-Ridder Newspapers, December 26, 1997. See where President Moi's son, Philip Moi involved in corruption at CNN website http://europe.cnn.com/2000/WORLD/africa/07/19/kenya.corruption.reut/ .
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RUSSIA'S ENVIRONMENTAL PICTURE
At one time, Industry Canada and Environment Canada in the early 1990's were setting up trade missions and funding programs to help Russia with its environmental clean up. At the time, Gary Gallon was President of the Canadian Environment Industry Association (CEIA) Ontario Office, when Canada brought over a number of senior government officials from Russia to discuss programs to improve their environment. Gallon had the pleasure of leading a delegation from Canada that met with them in 1994 in Hamilton, Ontario. By and large, the Russian officials knew very little about the environment. They had little interest in the environment. They kept asking about how to transfer the Canadian funds to Russia. They wanted to know about new Canadian technology that they could replicate in Russia. Somewhat blurry-eyed and reeking of booze, the Russian officials foretold of things to come. The large-scale Canadian effort at the time of helping Russia with its environmental clean up came to naught. The many environmen tal trade missions sponsored by Industry Canada to Russia resulted in many contracts that were not honoured by the Russians. Today, it is very hard to get Canadian companies to work there without iron-clad financial guarantees from the World Bank, etc. See the Environment Affairs website of Industry Canada at http://strategis.ic.gc.ca/sc_indps/sectors/engdoc/evir_hpg.html . Visit the State of the Moscow environment website http://www.md.mos.ru/eng/index.htm .
Russia is in environmental crisis, the Organisation for Economic Cooperation and Development (OECD) has concluded in its first ever survey of the country's environmental performance. Despite the passage of a raft of new environmental laws since the USSR's collapse in 1991, most are not being enforced. OECD found. Though of most immediate concern to a Russian population suffering increased mortality due to worsening environmental quality, the crisis also has broader European and global implications, the report notes. In particular, the country remains a major contributor to regional and global environmental problems such as acid deposition and greenhouse gas emissions. OECD found that environmental issues have had a lower priority in government in the second half of the 1990s. For example, since 1996, Russia no longer has a national environment minister. Russian national funding for environmental protection has fallen to just 0.5 percent of total environmental expenditure - a level the OECD says "arouses legitimate concerns." Among the results of these trends, the OECD reports, air pollution levels in many Russian cities exceed international health-based standards, while drinking water infrastructure has deteriorated so far that water borne disease and mortality have increased. Arrangements to safeguard a growing stock of hazardous wastes, including radioactive wastes, have been "compromised," presenting an "imminent health risk" in some localities, the OECD reports. Along with a 40 percent contraction in Russia's economy since 1991, many types of pollution have fallen. Source, Russia's Environment a "Grim Picture," OECD Says Moscow, Russia", Environment News Service (ENS), December 10, 1999. See the full story at http://ens.lycos.com/ens/dec99/1999L-12-10-02.html . See the UNEP/GRID environmental information system for Russia at http://www.grida.no/enrin/htmls/russia/arf_p0.htm .
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INDONESIA CORRUPTION HARMING THE ENVIRONMENT
The ability to protect the environment in Indonesia has declined substantially as a result of graft and corruption within the government and the military. In fact there has been so much corruption in Indonesia that it forced the World Bank it issue a report on the condition. This is significant given that the World Bank, the Asia Development Bank and other international aid agencies like US AID and Canadian CIDA have, for years, tried to ignore and play down the significance of corruption in their dealings with Indonesia and other countries like Nigeria, engaged in corruption.
In October 1998, an internal World Bank report estimated that, "at least 20-30 percent of GOI (Government of Indonesia) development budget funds were diverted through informal payments to GOI staff and politicians, and there is no basis to claim a smaller 'leakage' for Bank projects as our controls have little practical effect on the methods generally used." The October 1998 World Bank "Operational Overview" document suggested that the roots of Indonesian graft lay in Javanese culture but admitted that "many of our own World Bank staff (particularly headquarters task managers) are viewed as ignorant or uncaring (as in 'they don't really want to know') of local practices and thus subject to being misled or deceived rather easily." It also blamed the civil service pay system, which dates back to the Dutch colonial era and relies heavily on project bonuses, for "leaving nearly all civil servants in constant search of supplemental income."
This has had a direct impact on the ability of Indonesia to adequately manage its forests, wildlife habitat, and its freshwater rivers. Also, it has left Indonesia without the ability to protect its urban human environment from toxics, sewage pollution, and air pollution.
Throughout the 1980's, the Canadian International Development Agency (CIDA) ran a huge multi-million dollar environmental assistance program to Indonesia through Dalhousie University. It was called EMDI, Environmental Management Development for Indonesia. It involved helping the government and citizens of Indonesia to develop the societal capacity to protect the environment. It was part of helping to develop a "Civil Society". CIDA provided funding and expertise to help Indonesia to write and implement environmental law; to assess and develop technologies to eliminate raw sewage and reduce pollution, and to help environmental NGO's develop the capacity to work with government. The money was virtually wasted as corrupt government officials and unscrupulous military officers tried to purge the pollution abatement contracts of as much money as they could get, and then use the cheapest and worst materials for construction of the pollution abatement systems. It has left Indonesia an environmental basket case and has resulted in a virtual shutdown in international projects to clean up the country. Visit the Indonesia Corruption Watch website at http://www.icw.or.id/ . Also see the article on Indonesia and the environment published by the Inter Press Service (IPS) at http://www.50years.org/press/ips021599.html . See the OECD - Asia Development Bank initiative on anti-corruption in Indonesia at the website http://www.oecd.org/daf/ASIAcom/countries/Indonesia.htm .
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ABB CONVICTED FOR GRAFT AND CORRUPTION
It is not enough to focus on corrupt countries like Russia and Indonesia. It is just as important to focus on OECD-based multi-national corporations. That's why it was a shock to find out that Asia Brown Boveri (ABB), based in Switzerland as one of the world's largest and best engineering and environmental companies, was prosecuted for corruption. It was reported on the front page of the New York Times Business Section, April 13, 2001, that ABB was convicted and fined $63 million for corruption related to environmental projects. ABB, along with other major engineering companies in Germany and the United States, decided to defraud the U.S. Agency for International Development (AID) of hundreds of millions of dollars in a series of twelve environmental contracts worth more than US $1 billion. The projects were primarily sewage treatment, water treatment and waste water plants that US AID had promised to build for Egypt in the 1980's following the Middle East Peace Accord. The aid was being provided to clean up Egypt's sewage waste disposal and to improve drinking water supplies for the country. The New York Times reported that,
"ABB Ltd., the Swiss engineering giant, pleaded guilty yesterday to its role in the scheme, agreeing to pay $63 million in fines and restitution. The conspiracy, which lasted more than seven years, involved the rigging of contract bids submitted."
"Contracts were supposed to be awarded through competitive bidding. But the engineering companies subverted the bidding process through payments of bribes and kickbacks to other possible bidders, fraudulent billings to the government and laundering of cash through Swiss bank accounts," reported the NY Times, adding that, "the conspirators included at least six international construction companies, which collectively referred to themselves as the Frankfurt Group ... some of the companies went to great lengths to hide their profits, charging fictitious expenses from related companies to decrease the returns shown on their books."
As part of its corruption moves, ABB "met with other potential bidders on Contract 29, a US $135 million sewage treatment plant in Abu Rawash and agreed to pay them $3.4 million to submit inflated bids for the project. The ABB unit was then able to inflate its own bid on the project, knowing the offer would still beat other submissions." In another fraud charge, American International Contractors Inc., a construction company based in Arlington, Virginia, and owned by the Archirodon Group of Geneva, pleaded guilty last September to accepting payments in exchange for a commitment not to bid on a project known as Contract 20A, a US $107 million sewage project in Cairo. That contract was awarded to Jones-Harbert Co. Source, "Global Conspiracy on Construction Bids Defrauded U.S., by Kurt Eichenwald, The New York Times, April 13, 2001. Visit the Asea Brown Boveri International website at http://www.abb.com/ .
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ABB RESPONDS TO CORRUPTION CONVICTION
ABB spokesperson, William Kelly, said ABB had been cooperating with investigators since 1996. Kelly said that, "we deplore and deeply regret the behaviour that led to these charges. It stands up in sharp contrast to the high standard of business ethics practice by the great majority of ABB employees." It is interesting that prior to the corruption charges, Jörgen Centerman, President and CEO, of ABB Inc., Switzerland, issued a strong business statement on the ABB website. He said that, "more than 100 years of doing business has taught ABB a thing or two. Be fast and agile, keen and smart; take chances and push the limits of convention; don't be afraid to take a stand for what you believe in; create value for all your stakeholders; look for the contrarian perspective. When confronted with a new idea, say "Why not?" instead of "Yes, but . . .". Centerman went on to say that, "for generation after generation, we've worked with customers big and small, and we still do. Today, we are a business-to-business supplier - from process, manufacturing and consumer industries to utilities, the oil, gas and petrochemical industry, as well as automation and power products, and into financial services. Our goal is simple - to make our customers successful." ABB has more than 160,000 employees working in 100 countries. In 1998, Europe - including Central and Eastern Europe and Russia - accounted for 54 percent of the Group's revenues, and 64 percent of employees. The Americas accounted for 22 percent of revenues and 16 percent of their employees. Some 14 percent of both revenues and employees were in Asia, while the Middle East and Africa accounted for 10 percent of revenues and 6 percent of employment. Visit the ABB website at http://www.abb.com/ Visit their offices in Egypt at Asea Brown Boveri S.A.E. , Dr. Mohamed Kamel Hussein Street, P.O. Box 5040 Heliopolis West Cairo 11771, Egypt, Tel.: +20 2 29 88 155, fax +20 2 29 87 700. Visit the ABB Egyptian website at
href="http://www.abb.com/eg">http://www.abb.com/eg . Contact Asea Brown Boveri Inc. Canada, 8585 Trans-Canada Highway, H4S 1Z6 St-Laurent, Quebec, ph. (514) 856-6266, fax (514) 856-1916, website http://www.abb.com/ca . Source, "Global Conspiracy on Construction Bids Defrauded U.S., by Kurt Eichenwald, The New York Times, April 13, 2001.
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ANTI-BRIBERY LAW IN CANADA HINDERING CANADA'S ABILITY TO DO INTERNATIONAL BUSINESS
A new Canadian study entitled, "Impact on Canada of Corrupt Foreign Officials in Other Countries", was completed September 2000, under the auspices of Canada's Transnational Crime Working Group, and made public April 2001. The group that oversaw the production of the report, chaired by the Solicitor General's Department, included representatives from the Canadian Security Intelligence Service, Citizen and Immigration Canada, the RCMP, and more than a dozen other federal agencies including Industry Canada and the Department of Foreign Affairs and International Trade (DFAIT). Ironically, the report found that Canadian companies were too clean and were therefore hampered by not being corrupt enough! Canadian companies were losing business to other OECD-based multinational corporations like those in Japan, France, Spain and Germany, that were flexible when it came to participating in corruption. The report found that, "there is a general feeling in parts of the business community that Canadian commerce suff ers abroad because individual businesses do not pay bribes on a routine basis as a means of securing contracts." The study reported that, "one person doing business in a South Asian country reported being urged to contribute to various charitable foundations connected to members o that country's government". It also found that, "in the former Soviet Union, a business was required to make a bonus payment to the government for awarding it a contract, with some of the money going to the officials involved." Another firm told, "of being forced to pay no less than 37 separate bribes to get Canadian goods off the dock in a South Asian country." Source, "Anti-Bribery Law Impedes Business Abroad, Study Says", by Jim Bronskill, "National Post, Toronto, May 5, 2001.
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CORRUPTION MANAGEMENT BY THE WORLD BANK
The Governance group of the World Bank Institute (WBI) facilitates action-oriented and participatory programs to promote good governance and curb corruption in its client countries. WBI is providing support for programs to improve governance and control corruption, in full collaboration with World Bank Operations and often in partnership with international organizations, to nearly 30 countries, principally in Sub-Saharan Africa, Latin America, Eastern and Central Europe and, more recently, Asia. The group is currently working on the following major activities: developing a core course on controlling corruption; a core course on corporate governance and strategy; providing governance and anti-corruption diagnostic surveys for interested countries; provide public awareness raising and support to coalition building; and, strengthening parliamentary oversight and a judicial reform program.
The WBI anti-corruption activities date back to late 1994, when in collaboration with Transparency International, then-EDI (now WBI) facilitated a first workshop in Uganda. In 1996, in a major speech at the World Bank-International Monetary Fund Annual Meetings, James Wolfensohn, President of the World Bank, unveiled a new program and expressed the institution's commitment to "… help any of our member countries to implement national programs that discourage corrupt practices." Since then, the World Bank has mainstreamed anti-corruption programming, and WBI has been amongst those at the forefront of this process, which has entailed an expansion and evolution of WBI's program, encompassing a broader focus upon action-oriented governance improvements. Visit the website of the World Bank anti-corruption and good governance website at http://www.worldbank.org/wbi/governance/ .
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OECD CREATES NEW ANTI-CORRUPTION UNIT
The Organization for Economic Cooperation and Development (OECD) established a convention to combat corruption and bribery February 15, 1999. The Convention makes it a crime to offer, promise or give a bribe to a foreign public official in order to obtain or retain international business deals. It puts an end to the practice according tax deductibility for bribe payments made to foreign officials. The Convention commits 34 signatory countries, including all the world's biggest economies, to adopt common rules to punish companies and individuals who engage in bribery transactions. So far, twenty-one countries have been subjected to close monitoring to determine the adequacy of their implementing legislation, including Austria, Australia, Belgium, Bulgaria, Canada, the Czech Republic, Finland, Germany, Greece, Hungary, Iceland, Japan, Korea, Mexico, Norway, the Slovak Republic, Spain, Sweden, Switzerland, the UK and the US. For each country reviewed, the Working Group on Bribery has adopted a report, incl uding an evaluation, which has been made available to the public. An OECD Anti-Corruption Division has been created. Visit the OECD Anti-Corruption website at http://www.oecd.org/daf/nocorruption/
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CORRUPTION COULD RUIN TRADING IN GHG CREDITS
At the heart of greenhouse gas reduction efforts is the provision for joint initiatives (JI) and clean development mechanisms (CDMs) that allow credit to be given to countries that reduce their greenhouse gas emissions more than the Kyoto Protocol requirements. It is possible for industries in countries like Canada to pay millions of dollars to countries like Russia for the right to pollute more in exchange for that country polluting less. The idea is that payment for GHG credits would go to helping that country, like Russia, to further reduce its greenhouse gas emissions, or to grow forests to create carbon sinks. Provisions are being made to establish a commodities market in greenhouse gas emission permits. Companies like a coal-fired electricity plant (or a tar sands extraction plant) that can't reduce their greenhouse gas emissions, can buy GHG emission reduction units from a trade with a country or company in a country that is deemed to be reducing GHG emissions. Eventually, it is expected th at hundreds of millions of dollars in GHG credits will be traded. The potential for mismanagement and corruption is huge. If such trades, or agreements for credits are being made with countries with known corruption, like Russia or Indonesia, money will be lost and GHG reduction efforts will be thwarted by corrupt companies, or government officials.
Companies in Canada, for example, have created the Greenhouse gas emissions reduction Trading (GERT) pilot program. Launched by a multi-stakeholder partnership in June 1998, the Pilot will provide practical experience with this market-based approach. An emission reduction trading system provides industry, governments and other organizations with the opportunity to buy and sell emission reductions. By encouraging investment in lower-cost reductions, this approach has the potential to help Canadian companies and municipalities meet GHG reduction targets at a reduced overall cost. A typical GHG emission reduction trade occurs when a buyer with high cost options for emission reductions purchases a lower cost option from a seller and enters into a contract to transfer ownership of the emission reduction. Consider the following example. A manufacturer uses fossil fuels in its production process and releases significant amounts of GHGs. The manufacturer's options for reducing GHGs in its own operations might b e costly. Among its other options are the following. It could pay a municipality to capture methane produced by the municipality's landfills and that otherwise would be vented to the atmosphere. It could purchase emission reductions from a company that has undergone an energy efficiency retrofit of its operations. The retrofit has lowered the company's fossil fuel requirements and reduced the company's contribution to GHGs. The manufacturer's decision between the options will be based on cost, quantities, risk, and other factors. After negotiating terms and completing the trade, the manufacturer and the seller could submit the trade for consideration under the Pilot. In a perfect world, this could work well. With unscrupulous players, the trading system could be manipulated. Visit the GERT website at http://www.gert.org/background/ . See the website for the Carbon Trader at http://www.thecarbontrader.com/ .
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LETTERS TO THE EDITOR
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Letter to the Editor, Regarding Harris Government and Walkerton Disaster
The Walkerton disaster was certainly not the Harris Governments fault, but the ignorance and irresponsibility of one of these many government employees who are well paid and take in general (there are exceptions to the rule) not a responsible attitude for what they are doing.
Signed, Canada Unlimited Inc.
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Letter to the Editor, Regarding President Bush and Climate Change
Dear Mr. Gallon,
Your Environmental Newsletter of April 1, most of which deals with President Bush's welching on Kyoto and the grave risk of global warming, was most interesting. The way I see it, no one should be surprised that very few, if any, countries will be successful in meeting their Kyoto commitments. That was entirely predictable well before Bush won the US election. It is doubtful that all reasonably attainable improvements in energy utilization efficiency in the world will be adequate to achieve marked GHG emissions reductions in the face of the drive of third world countries such as China, India and Indonesia, to match the western countries' standard of living, ie. the acquisition and consumption of goods and services enjoyed by the western countries, not their energy consumption. If the world is truly serious about GHG, then it is going to have to wean itself off carbon-based fuels, and to do that, it is going to have to not only use solar, wind and geothermal but also embrace nucle ar power in a very major way. Electricity can not only substitute for energy now produced by burning fossil fuels, but can also be used to produce a clean fuel, namely hydrogen, by electrolysis of water. The hydrogen, in turn, can be used to power fuel cells. A carbon-based energy system can be improved, but the gains will be limited by the law of diminishing returns. To convert to a non-carbon based energy system, solar, wind and geothermal will not be able to cut it on their own. Nuclear power will also be needed and in amounts much greater than being used currently. Sincerely, Earle Lockerby, Fredericton, NB
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Dear Editor, On Free Trade:
I have been willing to put up with the considerable amount of subjective opinion and one-sided information from you in your "Gallon Environment Letter" in return for an occasional bit of decent news.&;nbsp; However, the content of your newsletter has deteriorated to the level of pure rhetoric. A more objective publication might try to answer these questions: If free trade is such a bad deal for developing countries, why do so many sign up? (Could it be, perhaps, that institutions like the WTO protect them from economic giants like the US?) If free trade destroys labour rights and environmental protection, how can it be that countries with the highest standards in these areas lead world trade? And why do these same countries direct the vast majority of their trade and investment to other high-standards countries? (Could it be, perhaps, that increased trade and investment do not hinder a country's ability to protect the environment or establish labour rights?) Is Mexico doing more in these areas sinc e NAFTA, or less? 50 years of experience has shown that free trade, in conjunction with democracy and the rule of law, stops wars, increases individual freedom and opportunity, and improves quality of life. Factor those trends into your writing and I might read your newsletter. In the meantime, kindly remove me from your distribution list.
Signed, Adam B. Greene, email agreene@uscib.org
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Letter to the Editor,
Hi, Gary. I shared your letter with my 20-something daughter, who had the following heartwarming observations. Those sea turtles were just getting in the way of profits, and we know that Chiquita takes good care of their employees...and will sue any news agency that says differently. Thanks for the info. Lots of people are getting turned away from the Canadian border on suspicion of being protestors. Some people are sneaking in through an Indian reservation that straddles the border. P.S. the next WTO meeting is being held in Qatar, so there won't be any pesky "right to assemble" and "freedom of speech" laws to get in the way of commerce.
Sincerely, Earle Cummings, email earlec@water.ca.gov
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Letter to the Editor, on Chapter 11, You Are Wrong,
Dear Gallon Letter,
I have been receiving your "Gallon Environment Letter" for several months now and find it informative and usefully linked to other sources of information. After that generally good experience, I was very disappointed to read your Special on the FTAA. This is a hodge-podge of all-too-familiar and largely uninformed environmentalist opinion and distorted reporting from a variety of sources covering issues both new and old, with no apparent editorial restraint or organization. Trade officials have done a poor job of accommodating their policies to legitimate environmental and social concerns. The FTAA process is open to fair criticism for shunting these concerns off into a dead-end committee with little influence on the negotiation process. But environmentalists only subvert their own advocacy when they indulge in hyperbolic statements and perpetuate distorted readings of trade history. Just a few of the hyperboles and distortions: The FTAA will not "remove the ability of every gove rnment to create or maintain laws and regulations protecting the health, safety and well-being of their citizens and the environment they share." After 7 years under NAFTA, there is not a single example of such an effect. Nor do trade rules "disallow" fishing rules to protect sea turtles. The complaint about the US shrimp import controls was that they were unilateral and applied differently to Asian countries than to Atlantic countries. The WTO Appellate Body cited with approval the Western Hemisphere convention on sea turtle protection (not yet, alas, ratified by most countries) that clearly authorizes turtle protection restrictions on fishing/shrimping. The many groups who cite the NAFTA Chapter 11 cases as examples of trade limits on national environmental regulation have not bothered to look carefully at the facts of those cases. Canada's MMT restrictions were not adopted on health grounds (and the US EPA has never regulated MMT on health grounds) because the health data are inconclusive.
Canada's trade restriction was successfully challenged by Alberta and other provinces following domestic procedures under the Act on Internal Trade; only after losing that case did the government settle with Ethyl. The Metalclad and SD Meyers records show clear political and protectionist motivations behind the government actions. In the SD Meyers case, Canada's PCB export ban was adopted by Council over the strong advice of Environment Canada officials that incineration of Quebec and Ontario PCB waste in Ohio was environmentally acceptable and probably preferable to shipment to Alberta, the only Canadian disposal option. After a year, the Council order was rescinded. One more example of misunderstood history: the case brought by Venezuela against US reformulated gasoline regulations came about because the original rule, drafted with the help of US oil companies, was clearly trade-discriminatory in a way that had nothing to do with air quality. The US EPA agreed to modify the rule to address
Venezuela's concerns, but that modification was blocked in Congress at the behest of US firms competing with Venezuela-owned Citgo in the eastern US market. Again, a case of economic protectionism trying to wrap itself in the environmental mantle.
Sincerely, Sanford Gaines, Dean, Law, College of Law, LAW 6371, University of Houston Law Center, University of Houston, Building: TU2, Room 128, 4800 Calhoun Rd., Houston, Texas 77204 , Phone: (713) 743-2159, SGaines@UH.EDU ,
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Letter to the Editor, NAFTA and Free Trade
Thank you for your very clearly written explanation (expose) of the impacts of NAFTA and FTAA. I had not previously realized--in my deepest of deep heart--how devastating these agreement are. I am reminded of an image--I supposed I've seen one somewhere--of a fat greedy man (or woman) eating himself to death and enjoying it. Unfortunately, these statements do not necessarily represent the views of the U.S. Coast Guard, and are mine alone.
Signed, David G. Sox, Environmental Protection Specialist, U.S. Coast Guard MLCPAC (sp), Bldg 54-D, Coast Guard Island, Alameda, California 94501-1500, Tel: 510.437-3661; Fax: 510.437.5753; Email: dsox@d11.uscg.mil
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STRATOS PROVIDES SURVEY ON CANADIAN CORPORATE ENVIRONMENTAL AND SUSTAINABILITY REPORTING
In order to assess the state of Canadian corporate reporting practices, the Ottawa-based Stratos Inc. consultancy, has launched the first in-depth survey of Corporate Environmental and Sustainability Reporting in Canada. Stratos personnel and Alan Willis, a Stratos Associate, in collaboration with SustainAbility Ltd., are undertaking The Canadian Corporate Sustainability Reporting Benchmark Survey. The objectives of the Survey are to Identify and analyse current practices and trends in Canadian Corporate Environmental and Sustainability Reporting; benchmark Canadian practice against emerging international norms and practice (e.g. Global Reporting Initiative); assist reporting companies to improve their corporate reports; and, stimulate demand for Corporate Environmental and Sustainability Reports in order that additional companies begin reporting, and to expand the use of reports by the financial sector and others. Corporations are facing increasing pressures from various stakeholders to report on economic, environmental and social issues. Emerging international norms, such as the Global Reporting Initiative, provide a basic framework on how to produce credible reports that meet the needs of companies and external stakeholders.
The Survey will examine the quality and comprehensiveness of Canadian Corporate Environmental and Corporate Sustainability Reports and will provide a basis for improved corporate practice in reporting as a strategic instrument to aid corporate progress toward sustainability. The results of the Survey will be available to the public in October 2001, and will be widely disseminated. Stratos is convening a select group of sponsors from the corporate sector, the federal government, and the investment community to fund the Survey. Sponsorship is structured to involve leaders and interested parties from both the producers and the users of Corporate Environmental Reports and Corporate Sustainability Reports. For more information, please contact George Greene, President, Stratos Inc. email ggreene@stratos-sts.com , and Stephanie Meyer, Sustainability Reporting Manager, Stratos Inc. email smeyer@stratos-sts.com
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