Can the environment survive industrial demands?

• Author: French, Hilary F.

LOW-COST tropical timber that is harvested from the rain forest in Malaysia is shipped to Japan, where it is processed into plywood that becomes shuttering used in construction that could have been made from plantation-growth softwoods. Lead car batteries are exported from the US. to a recycling plant on the outskirts of Sao Paulo, Brazil, which has health and environmental controls so inadequate that 86% of workers tested have lead concentrations in their blood that exceed the American recommended limit, some by as much as two to three times. A dam built on the La Grande River in northern Quebec to generate electricity for export to New England floods an area half the size of Belgium, displacing the Cree Indians who called the land home and poisoning their fishing grounds with the release of naturally occurring mercury. In these and thousands of other cases, international trade is spurring environmental degradation and transferring it around the globe.

Yet, the growing integration of the world economy has some positive environmental effects. For instance, fuel-efficient Japanese cars reduced air emissions in the US. and forced American manufacturers to develop comparable models.

International merchandise trade, now about 3.5 trillion dollars, has grown 5.5% annually since 1950, regularly outpacing the expansion of global output as a whole. This includes primary goods such as food, raw materials, minerals, and energy, as well as manufactured products. Trade in services, running at more than $800,000,000,000, also is growing fast, as is direct investment in foreign countries. These trends mean that international commerce is shaping worldwide environmental practices in various ways each day.

Trade magnifies the ecological effects of production by expanding the market for commodities beyond national boundaries. Second, it allows nations that have depleted their resource bases or passed strict laws protecting them to reach past their borders for desired products, effectively shifting the environmental impacts of consumption to someone else's backyard. Finally, national environmental laws and even some international treaties are coming under attack as "nontariff barriers to trade," jeopardizing efforts to restore ecological quality within countries and to protect the global commons, such as the atmosphere and oceans.

As with transboundary and worldwide pollution, national governments acting alone are unable to control the environmental effects of trade, making international cooperation essential. Yet, despite the many interactions between them, trade and environment traditionally have been seen as separate domains in the international arena. When the General Agreement on Tariffs and Trade (GATT) was created in 1948, its main task was lowering the tariff barriers erected in the 1930s that were widely blamed for the global depression. The environment was scarcely a national concern then, let alone an international one.

Now, though, as ecological issues achieve a new prominence on the international agenda and increasingly bump up against trade agreements, the world is beginning to take note of the connections. Such matters have become a major feature of several ongoing negotiations--the talks on expanding GATT, debate over Europe's single market, and discussions about the North American Free Trade Agreement (NAFTA) among Canada, Mexico, and the US. In these and other forums, governments are struggling to reconcile antiquated trade rules with present-day environmental realities.

In the postwar era, free trade sometimes has been pursued as an end in itself, rather than a means to an end. This approach is beginning to give way to the view that trade is a tool for shaping a world that is ecologically sustainable and socially just. Governments are recognizing sustainable development as an overriding goal of the world community. Now, policymakers must get on with the task of determining how the rules of trade can be revised to help achieve it.

Trade and the global resource base

Much of the commerce in primary products takes place between industrial countries, while developing nations are net exporters of food, raw materials, minerals, and fuels to the industrial world. In the Third World, primary products tend to dominate exports. More than 98% of the exports of Bolivia, Ethiopia, Ghana, and Nigeria fall into this category, compared with 24% of U.S. exports and two percent of Japan's. Many developing countries thus are particularly vulnerable to trade-inflicted damage to their natural resource bases, yet depend heavily on the foreign exchange exports can generate, making policies that promote sustainable production over the long run especially important.

The tropical timber trade demonstrates many of the pitfalls of natural resource-based exports, beginning to fall as commercially valuable forests are decimated to please consumers in Europe, Japan, and North America. In Nigeria, exports have dropped precipitously over the past decade in response to overlogging, and Thailand and the Philippines--once wood exporters --have become net importers due to the ravaging of their forests. Several other countries, including Cote d'Ivoire and Ghana, soon will make the same transition.

In Malaysia, at least half the trees felled for timber are exported, bringing in $1,500,000,000 in foreign exchange. The East Malaysian states of Sarawak and Sabah, which supply Japan with more than 90% of its tropical imports, have been particularly hard hit. In Sarawak, environmentalists predict there will be no trees left to cut in as little as five years, bringing about the destruction of the homeland of the local Penan people, who aggressively are fighting to save it.

One of the victims of deforestation induced by the tropical timber trade and other forces is the Earth's biological wealth, as plants and animals in the...