North Debates Global Mandates

Summit heats up long-simmering dispute between the rich North and the developing South. EARTH SUMMIT

JOHN CREGAN, president of the Washington-based United States Business and Industrial Council, cynically refers to the United Nations Conference on Environment and Development as "the Global Meeting of New World Odor."

The meeting's broad-based agenda looks for problems that do not exist, he says. "The Rio summit puts politics ahead of science, and wealth redistribution ahead of wealth creation."

Like many opponents of international mandates, Mr. Cregan says the Rio organizers' goals, such as worldwide treaties on global warming, preservation of forests, and averting the extinction of species, cannot be dictated by governments. He says they can only work if they are supported by the private sector.

"Spending money is the only means of addressing [ecological] degradation," he says. "Only a growing economy, unencumbered by costly regulations, can produce enough wealth and technology to deal with these problems."

Preserving natural resources is not a prerogative, it's a responsibility, says Alan Brewster, senior vice president of the World Resources Institute. "Many in the developing world see environmentalism as a luxury - a concern of the wealthy." But with all the Rio-spurred awareness of environmental problems and solutions, even the poorest countries now have a fuller understanding of the relationship between natural resource use and environmental degradation, he says.

Sir William Ryrie, head of the World Bank's International Finance Corporation (IFC), the largest provider of funds for private projects in developing countries, says governments must be ecologically sensitive while promoting their nation's industrial potential. "Only governments can establish the regulatory systems which will ensure that business and industry maintain high environmental standards."

Do leading industrial countries have a special role to play by forming exemplary policies?

German Chancellor Helmut Kohl thinks so. He has pledged to put environmental issues at the top of the agenda when he hosts the Munich economic summit of industrial nations this July. In a recent speech, he said, "the 20 percent of the world's population living in the industrialized countries is responsible for 80 percent of worldwide carbon-dioxide emissions. This makes clear who will need to bear the main burden for reducing ... emissions."

The US demonstrates leadership in several environmental arenas. It spends $120 billion annually on environmental cleanup, more than any other nation. It is also among the world's largest polluters. And this week, a wide spectrum of critics charge, the US is out front with hypocritical environmental policies.

"The irony of George Bush's role in Rio is so blatant," says Cregan, a trade and regulatory adviser to conservative Republican presidential candidate Patrick Buchanan. On the eve of the Earth Summit, Cregan says, Bush extended the moratorium on environmental standards for US business.

For the time being, it seems, Cregan's council and other US industry groups have successfully lobbied against the government-imposed environmental regulations. "Now Bush is trying to regain his credentials as the `environmental president,' " says Cregan, "so he's going down to Rio where they want to globalize environmental regulations."

The Environmental Defense Fund assails the Bush administration for opposing changes in policies that would reduce energy waste. US negotiators have resisted intergovernmental studies of national energy policies, for example, and the EDF is pressing Bush to offer incentives for efficient and renewable energies. While good leadership starts at home, "the US hasn't dealt with these issues as fully as it should," says Mr. Brewster. Long-term economic considerations "say we ought to use resources efficiently and produce more competitively."

Developing countries must become part of the regulatory process, says the US Congressional Office of Technology Assessment (OTA) in a recently released report "Trade and Environment: Conflicts and Opportunities." The OTA hits a raw nerve for negotiators from the US and other wealthy countries.

"Many developing countries argue that they need help from the developed world to finance environmental protection. And some say that environmental protection should take a back seat to their plans for economic development, as it has in developed countries until recently."

Banks and big business see an enterprise opportunity here, and welcome officialdom's role.

Demand for environmental technology "will balloon in the 1990s," according to an IFC assessment. Fast-paced industrialization and urbanization strain outmoded sewage and water treatment systems; air and soil pollution is unbearable. The world market for environmental goods and services will double over the next decade to $600 billion a year, the IFC says, and the best place to create this "highly profitable industry" is in the developing world, where the products are sorely needed.

Anxious to assist export sales of US environmental technology and goods, the US Export-Import Bank, a US government institution that finances US goods and services to needy markets abroad, is setting up a temporary shop at the ECOBRASIL '92 Sao Paulo trade fair, June 6-12.