May 9, 2001
Robert Zoellick
US Trade Representative
Office of the USTR
600 17th Street NW
Washington DC 20508
Dear Ambassador Zoellick:
The undersigned United States and Japanese environmental groups submit this letter to express our concerns about the potential environmental impacts associated with the increase in Japan's wood product consumption as a result of the US-Japan Enhanced Initiative (EI). We request that the USTR conduct an environmental assessment of the housing sector deregulation proposal within the EI, an assessment that we believe is consistent with the requirements in Executive Order #13141, including the Executive Order's emphasis on assessments of trade liberalization agreements in natural resource sectors. At the very minimum, we ask that the USTR investigate and supply us with information about the potential impacts of the EI on forests in the US, Japan and other countries.
In a July 2000 press release, the USTR implied that the US-Japan EI will lead to increased wood use in Japan. According to the USTR statement, the EI "will create important new opportunities for U.S. firms, who stand to benefit from hundreds of millions of dollars in new sales" on top of the $3.3 billion in building materials already exported to Japan each year. Specifically the EI will "clear the regulatory thicket" which makes it difficult for US companies to export house construction materials to Japan by reducing Japanese controls on housing size, lease renewals and resale appraisals. As a result, Japan may experience a 17% increase in new housing starts as well as an expansion of its wood-based remodeling sector, according to USTR documents. While we recognize that the EI relates not only to wood products but also to non-wood products, we have learned from conversations with the USTR and the Center for International Trade in Wood Products (CINTRAFOR) that structural, joinery and finished wood products will likely be among those affected.
When considered alongside other current international timber trade proposals, and in the absence of assurances of environmentally acceptable forest management practices, we find the implications of the EI of particular concern. For example, the Accelerated Tariff Liberalization (ATL) proposal at the WTO would also increase Japan's consumption of wood products from abroad at the same time that it reduced Japan's domestic production by 6%. Furthermore, the APEC EVSL initiative and other NTM liberalization plans could prohibit Japan's use of procurement policies, such as those that encourage consumption of wood and paper products that have high recycled content and come from sustainable sources. We fear that the combination of the EI and other trade liberalization plans will increase Japan's consumption of wood at the same time that it reduces Japan's ability to meet this increase through domestic sources, shifting pressure on to other countries including the US.
With 80% of the world's original forest lost or degraded and 39% of the remaining intact forests under threat, the US and Japan - the two largest wood fiber consumers in world - should be more vigorously applying conservation measures, demand reduction, and improved forest management practices. At the same time, both countries should ensure that any new trade proposals likely to affect the forest sector are given sufficient analysis to identify and minimize potential environmental and other impacts. At present, we do not believe such analysis has been done for the US-Japan Enhanced Initiative.
We would appreciate a response from the USTR to this letter. Regarding Executive Order #13141, we ask USTR to initiate an Environmental Assessment of the EI that includes the following:
1) A calculated estimate of the likely increase in demand for wood products (expressed in board feet or cubic meters) associated with the projected increase in new housing starts and remodeling in Japan;
2) An analysis of how the aforementioned projected increase in demand will be met. This should include an assessment of which species will be used and from what sources (country, region, and type of forest management), and the estimated increases in harvest volume by source; and
3) An analysis of how the projected changes in harvest volume and source may affect the forests and forest sector in each of the source countries.
Finally, we request USTR to provide us with copies of, and/or references to, any existing studies and documents that forecast the impacts of the US-Japan EI on forests, the forest sector, and forest product imports and exports of the US, Japan and any other potentially affected countries.
Thank you very much for your attention to this matter. We look forward to hearing from you.
Sincerely,
A. Paige Fischer
Forest and Trade Program Director
Pacific Environment
Dan Seligman
Trade and Environment Program Director
Sierra Club
Susan Casey-Lefkowitz
Senior Attorney, International Program
Natural Resource Defense Council
Carroll Muffett
International Program Director
Defenders of Wildlife
David Waskow
Trade Policy Coordinator
Friends of the Earth
Victor Menotti
Environmental Programs Director
International Forum on Globalization
Joe Scott
Conservation Director
Northwest Ecosystem Alliance
Jason Tockman
International Trade and Forests Program Director
American Lands Alliance
Tokiharu Okazaki
Friends of the Earth Japan
Toyoyuki Kawakami
APEC Monitor NGO Network
Takahiro Kohama
Japan Tropical Action Network (JATAN)
Cc: Doug Norlen, ISAC 12