NAFTA: Related Environmental Issues and Initiatives

Publication Date: September 2004

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Trade

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Abstract:

The North American Free Trade Agreement (NAFTA) includes several environment-related provisions, that while limited, were unprecedented for their inclusion in a trade agreement. However, further environmental (and labor) assurances were needed to secure passage of NAFTA, and ultimately, the negotiating parties agreed to a side accord that promotes cooperation on environmental matters and includes provisions to address a party's failure to enforce environmental laws. Additionally, the United States and Mexico entered into the Border Environmental Cooperation Agreement (BECA), which authorized the establishment of the Border Environment Cooperation Commission (BECC) and the North American Development Bank (NADB) to help border communities finance environmental infrastructure projects.

In the 108th Congress, NAFTA's environmental provisions and related institutions have continued to receive attention. A key issue has concerned the effectiveness of the NADB and the BECC, and especially the Bank's ability to finance projects. Enacted on April 5, 2004, P.L. 108-215 (H.R. 254) authorizes several operational reforms to the NADB. Other issues involve the environmental impact of NAFTA, and the effect that NAFTA and its environmental side agreement have had on the negotiation of other U.S. trade agreements, including the U.S.-Central America Free Trade Agreement (CAFTA) and U.S.-Chile FTA. This report briefly reviews NAFTA's environmental provisions, associated agreements, and related issues and congressional actions. It will be updated.