Note: The following is a partial summary of remarks given at the Hemispheric Trade and Sustainability Symposium. It is neither an official document nor a complete transcript, nor has it been checked against the speaker's text.

Seven years ago, Canada, Mexico and the U.S. took the step to link the trade and environment agendas, partly in response to the debate taking place within civil society. A NAFTA side agreement established the NACEC, which is entrusted with supporting cooperation among the three countries while they pursue economic integration through NAFTA. The NACEC targeted three issues: the regional examination of policy and scientific dimensions, which must lead to more coordinated responses; enforcement of environmental laws; involving the public in a transparent decision-making process that has a mechanism for holding government accountable.

North America is a test case for whether environment can be improved by free trade. It is still too early to tell whether it is a success, but there have been some clear benefits.

At heart is the question of the environmental consequences of free trade. We've developed a methodology for assessing effectiveness, a process to which many in this room contributed. We held a symposium last year in Washington to apply the framework and identify the environmental effects of NAFTA in key areas. These studies showed that some sectors are real examples of success: steel and the pharmaceutical industry saw improvement in Mexico, for example, with increased investment opportunities and more environmentally friendly production. There are areas where challenges remain, such as in the transportation sector, where the increased number of trucks crossing borders with accompanying emissions that need to be reduced.

We have learned that it is important to engage people in the discussion and to bring people with different areas of expertise to present analysis. We are now begin now to move away from abstract discussion to a more concrete discussion that develops a more informed community with a better understanding of the link between trade and environment and that can identify problems that need to be addressed.

We are also looking at where policies can be coordinated. We have looked to see how this can be done in certain sectors, such as shade coffee from Mexico and in the energy sector. The example of shade coffee from Mexico means that one day soon trade in shade coffee will increase, leaving forests intact and enabling rural communities to generate much needed income.

In the case of electricity, North America is now experiencing the reality of an integrated energy market, with transborder electricity moving from Canada to the U.S. and now also to Mexico, which recently purchased electricity from British Columbia. We have a group of experts to help us consider three particular issues: Should similar generating facilities have comparable pollution controls in order to avoid dumping claims? Should generators receive market incentives to avoid using fossil fuels? Can trade disputes be avoided when providing renewable energy sources?

These are two examples of the win-win opportunities that can be forged by linking trade and environment agenda.

But progress can be only achieved in partnership with civil society. Transparency and public participation are core values reflected in the design of the commission. Each country is encouraged to establish its own advisory committee, which has in fact been done. There are different levels of participation among the committees, but nonetheless they have made a difference. We need to take a look at that impact.

These three countries have established the most innovative mechanism in terms of transparency by having the commission secretariat receive complaints that are then reviewed by independent party. This practice is known in the sphere of human rights, this is an independent review unique in international environment agreements. Article 14 effectively enables any member of the public to blow the whistle if he or she believes the government is not enforcing environmental laws. This is a tool for the public to deal with alleged non-enforcement of environmental law. It has no legal consequences, but it does demand accountability. This has interesting ramifications for government and industry as well as for the public.

The citizen submission process, public advisory committees and other efforts to make information accessible are all ways to promote and strengthen democracy in North America.

Investment in capacity building for environmental protection is essential. It became clear that investment in high levels of environmental protection and the enforcement of laws allow countries to come to terms with liberalized trade. Enormous strides have been made in Mexico in chemical management and pollution prevention. This kind of action needs an investment in the infrastructure and capacity building, or else participation gets turned into being a burden.

In an integrated North American market, approximately 80 000 chemicals are used in commerce. Many may move across borders, either intentionally or unintentionally as pollutants. We know that they can travel thousands of miles through the atmosphere. We are working to reduce pollution, and DDT and chlordane are no longer used in North America. Mexico has taken great strides, and now North America is a leader in signing an agreement on persistent organic pollutants. Many other chemicals are being considered for concerted action to reduce their use.

A pollution registry is an important tool. We have helped Mexico develop its domestic process and helped compile data on other issues. The report called Taking Stock has been published annually since 1996 and identifies trends in pollutants and transfers. This document breaks new ground on this issue.

Progress has also been made in many areas in advancing environmental commitments. There are challenges, too, such as Chapter 11. Another challenge is to ensure that the citizen submission process continues to be a useful tool for the public. But the largest challenge is to divert and direct some of the financial muscle and resources generated by trade into the environmental infrastructure and programs that are necessary. There is a lack of institutional capacity to deal with this at the national level and at the global level, and also at the domestic level.