Global trade may be best hope for the health of the global environment

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By RITA SCHENCK
and VALERIE LEE
Environment International Ltd.

Printed in the Seattle Post-Intelligencer

 

Despite much press coverage of anti-WTO activities by some environmentalists, we feel it is important to point out that these groups do not represent all segments of the environmental community. Some environmental organizations believe that trade can actually be good for the environment. Some also view public-private partnerships between environmental non-profits and for-profit businesses as the best hope for global environmental improvement.

The reason is that an increasing body of evidence shows that improved economic performance can often be linked to improvements in environmental quality. For example, although the world as a whole is suffering deforestation, especially in tropical areas, the two most mature capitalist and multinational areas of the globe, Europe and North America, are actually increasing both the area of forests and their maturity. In contrast, true environmental devastation is often worst where there is a low level of industrialization and consequent poverty. An example of this can be found in India, where the air quality is so bad that it is estimated that 10,000 people per year die in New Delhi alone from the results of uncontrolled combustion sources. And the stories about environmental disasters in the former Soviet Union are legion.

Moreover, some for-profit companies are embracing environmentalism, not only because they view it as the right thing to do, but also because it makes good business sense. Companies are adopting environmental management systems, with assistance from both the non-profit and the private sector, in countries throughout the world. These businesses are doing so because environmental management systems can make them money. Efficient use of resources and protection of the local environment can help increase market share in a highly competitive global economy in which consumers are demanding that manufacturers demonstrate that products be “green.”

Government programs are being developed that encourage companies to use environmental protection as an integral strategy for their success. For example, the U.S. Federal government has a program for environmentally preferable purchasing. Companies that prove that their products are environmentally superior must by law be given preference in government purchasing. And several states have requirements for environmentally preferable purchasing as well. Similar programs exist in other countries, notably Germany and the Nordic countries. With these programs, the environmental aspects of sales drive sustainable business practices.

Today is an age where good business strategies and good environmental practices are converging. The globalization of trade and the sale of goods in environmentally conscious markets are increasing the speed of this convergence. However, this does not mean that capitalism and industrialization are naturally environmentally benign. Our own history shows this to be a fallacy. A mere 25 years ago, rivers caught fire on a regular basis in the Midwest. Since then, the development of environmental legislation, regulation and enforcement have rapidly reduced the pollution derived from industrial sources, with a concomitant improvement in our environmental quality. As a result of the strong enforcement against pollution from manufacturing, the bulk of the pollution in this country comes now from diffuse sources such as farms and the actions of individuals.

But the rapid environmental action taken in this country came at a high financial cost. Estimates of our command and control strategy’s drag on the economy range from 2 to 5 percent of the GDP. For some companies, environmental costs are as much as 20 percent of sales. Unfortunately, our colleagues in developing countries do not have the wealth to address environmental issues with such a strategy. When the population is starving, environmental concerns naturally take a back seat.

Enter the WTO. A great deal has been alleged about the supra-national and non-democratic nature of this body and its control by multi-national corporations. But even if all of these accusations were true and we were to dismantle the WTO tomorrow, that would not stop globalization. Nor would it improve the world’s environment. Events outside the WTO drive globalization. Current communication and transportation technologies have shrunk the world. Events in Colombia are front-page items the next day in the Times. Upsets in the markets in Japan are felt on Wall Street within hours. There is no way to undo the new technology, and there is no way to stem the tide of globalization. We can only hope to direct its uses and reduce its abuses.

For all its shortcomings, the WTO provides a global forum in which the environmental and social aspects of trade can be discussed, and rules of civilized behavior for capitalism can be elaborated. The opportunity for environmentalists and businesses is to harness the economic potential of the environment and the environmental potential of business and trade together. The challenge for activists is to develop creative ideas for how the synergies of the economy and the environment can work towards worldwide sustainability.

The WTO is the one place where decisions on trade have uniform, global implications. We will be there because it seems to us to be the best opportunity we currently have to ride the tide of globalization to environmental advantage.

Rita Schenck, Ph.D.
Executive Director, IERE

Valerie Lee, J.D., M.S. Civ. Eng.
President, Environment International Ltd.

 

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