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David Sandalow Assistant Secretary for Oceans and International Environmental and Scientific Affairs U.S. Department of State Keynote Address to Conference on EU and US Environmental Policy-Making Sponsored by the Transatlantic Environmental Dialogue and Heinrich Boll Foundation Brussels, Belgium, May 12, 2000

(As Prepared for Delivery)

"Reflections on Transatlantic Environmental Cooperation"

[Acknowledgments]

My topic tonight is "transatlantic environmental cooperation."

My proposition is straightforward: By working together, we can help protect the planet. In this era of unprecedented stress on our natural environment, the United States and the nations of Europe can help shape lasting solutions to environmental problems if we join together in common resolve.

In contrast, if we bicker or quarrel, we will fail.

I intend tonight to be brutally honest. I will not shrink from the plain fact that Europeans are often exasperated with the United States. As an American diplomat, this is hard to miss: I recall a British friend -- yes, friend -- who rolled his eyes in response to one of my comments recently and said "Well, what do you expect from the Great Satan?" Nor will I pretend that this feeling of exasperation isn't sometimes mutual. I recall an American friend who returned from a trip to several EU countries recently and wondered: "How can they go on and on about the risks of bio-engineered food while puffing away on their cigarettes?"

But I believe that our similarities far outweigh our differences; that our common goals transcend any differences in approach; that our shared commitment to democratic values is a powerful engine for addressing environmental challenges; that the blessings of prosperity on our two continents can help provide the resources needed to meet these challenges worldwide; and that our shared aspiration to shape a better tomorrow will help overcome any differences and leave behind a planet as healthy and bountiful as we found it.

I hope tonight to spark thought and, more important, progress in our common endeavor.

1. THE GLOBAL ENVIRONMENT

Our inquiry starts with the world as we find it. It is a world of unprecedented opportunity but unprecedented challenge.

Around the world, people are living lives of wealth and splendor unimagined even a few generations ago. Communications, information, energy, transportation and medical technologies -- to name a few -- offer people around the globe the chance for lives that are fuller, healthier and more satisfying than ever before.

What was once miraculous is now commonplace. I recall how I marveled, not much more than a decade ago, to exchange faxes with a colleague 12 time zones away. Now e-mail communications across vast distances are entirely routine for tens of millions of people around the globe.

At the same time, billions of people on this planet live in abject poverty. More than 2 billion people lack access to clean water; more than 1 billion people subsist on less than $1 per day. HIV/AIDS, malaria and other infectious diseases plague whole continents.

As human beings gain great riches and struggle for sustenance, as our population grows, as we discover new technologies that allow us to magnify the impact of each human being on the planet, we are dramatically altering the global environment.

For the first time in history, human beings are changing the climate system. Scientists warn that, unless we change course, the next century will likely bring temperature increases greater than this planet has seen in the past 400,000 years, rising seas, more severe and frequent storms, the spread of tropical disease, widespread forest loss and the collapse of many unmanaged ecosystems.

We are losing species at a rate unknown since the extinction of the dinosaurs more than 60 million years ago. In the entire 2 billion year history of this planet, there have been five great waves of extinction -- unless you count the past several decades, during which scientists believe human beings have triggered the sixth great extinction in the history of planet Earth.

We have had great successes in protecting our environment: The air in American and European cities and the water in our lakes and streams are far cleaner than they were a generation, or even a decade, ago. But around the world hundreds of millions of children still breathe foul air and lack access to clean, drinkable water.

2. US-EU RELATIONS

So this, in brief, is the state of our planet. What is the state of transatlantic relations?

We enjoy, without doubt, one of the most powerful and enduring partnerships of any two regions in history. As Secretary of State Madeleine Albright said earlier this year: "The great lesson of the century is that the destinies of North America and Europe are joined."

For more than 50 years, the United States and Europe have worked closely together to promote security, democracy and prosperity. We have succeeded -- for many, beyond their wildest dreams.

We have worked closely through enduring institutions such as NATO, OSCE and the OECD. Together, we have prevailed over tyranny, contained conflict, promoted human rights and advanced the rule of law.

We have worked together to produce a prosperity that lifts the lives of people on both sides of the Atlantic. The combined annual commerce between the United States and Europe exceeds $1 trillion. One in 12 US factory workers is employed in one of the 4000 European-owned businesses in the U.S. Our firms employ 3 million Europeans.

As US Deputy Treasury Secretary Stuart Eizenstat has said: "The relationship between the United States and the European Union may be the most important, influential and prosperous bilateral relationship of modern times."

At the same time, we are not just partners, but competitors. Our businesses compete for markets around the globe. Our governments often play an important role in this rivalry, providing export credits and other assistance to businesses seeking markets worldwide.

We've learned that economic integration, while producing greater wealth, can also lead to resentment and suspicion. Some Europeans have made their views concerning McDonald's restaurants clear; some Americans in my home state of Michigan were concerned when Chrysler became Daimler-Chrysler several years ago.

Referring to attitudes in Europe, the novelist Pascal Bruckner said recently: "Never has America been so loved and so hated." According to U.S. press reports, European book stores are carrying titles such as "No Thanks, Uncle Sam," "American Totalitarianism" and "Who Is Killing France? The American Strategy."

Europe and the United States are each global economic superpowers. It is not surprising that our relationship should be marked not just by friendship, but also by stresses and strains. The challenge for those of us working in transatlantic relations is to promote cooperation and manage competition in ways that benefit our citizens and people around the world.

3. SUCCESSES TO DATE IN PROTECTING THE ENVIRONMENT

How can this partnership -- marked with healthy competition -- shape global efforts to protect the environment?

It already has. When the United States and countries of Europe work together, among ourselves and with other nations, we get results.

Thirteen years ago, nations from around the world were struggling to shape a global treaty to address an astonishing environmental threat: the loss of ozone from the stratosphere. New data showed a dramatic ozone hole opening up over Antarctica, and serious threats to human health and ecosystems around the world unless the release of ozone-depleting substances into the atmosphere could be brought under control.

As with many environmental issues, the United States and Europe brought forward different approaches to addressing this problem. The United States sought a ban on the use of CFCs in spray cans; the European Commission sought a cap on CFC production capacity. After difficult negotiations, we agreed on a compromise based on limits to production and consumption and ultimately agreed to make resources available to help developing countries address this problem. And the result was the Montreal Protocol to Protect the Ozone Layer -- perhaps the most successful global environmental treaty to date.

More recently, we overcame significant differences in outlook and approach to shape a Biosafety Protocol. Before our meeting in Montreal last January, many observers thought an agreement impossible -- in large part due to the very different positions taken by the Miami Group (of which the US is a member) and the European Union. But we worked hard and with an open mind to address each others' concerns, and the result is a good agreement that will help countries around the world manage the environmental risks and benefits of modern biotechnology.

But our success has not been limited to global treaties. The US and EU have also been partners in regional programs, helping countries around the world protect their natural environment.

For years, we have worked together to help protect the Amazon. Under the G-7 Pilot Program for the Conservation of the Brazilian Rainforest, known as "PPG-7," we have vastly improved scientific understanding of rain forests in Brazil, promoted community involvement in sustainable development and conservation, and contributed to the Brazilian government's capacity to conserve this great natural resource. The EU has been an especially generous contributor to PPG-7; the US has contributed substantially to PPG-7 and to many other programs in the Amazon region. Our collaboration in identifying what resources each donor can most effectively bring to bear has contributed greatly to the program's success.

Together, we helped found the Regional Environmental Center in Central and Eastern Europe. The REC became a vital independent voice, assisting in many ways to promote sustainable development and address environmental problems. Significantly, the REC has "graduated" from direct, untied international assistance to emerge as a truly independent Center.

The success of this original REC has sparked regional environment centers in countries of the former Soviet Union. In Kiev, a REC establishment decree was passed by the Ukrainian Cabinet on April 24. In Moldova and Tbilisi, RECs have been registered. In Almaty and Moscow the process of registration and related activities are going forward. While much remains to be done, our cooperative efforts have helped regional partners protect the environment and promote civil society.

Our cooperation on chemicals has led to significant progress, including work in the OECD on harmonized test guidelines and good laboratory practices. Last year, the EU sponsored the first transatlantic environmental conference on chemicals, which produced important research cooperation on endocrine disrupters and a better understanding of chemicals management issues. Next year, the United States plans to host the second conference.

The list goes on. Together, we have made a difference.

4. COMMON FACTORS IN OUR SUCCESS

What factors tie these successes together? I believe there are four.

First, we succeed when we share a strong commitment to a common goal. In negotiating the Montreal Protocol, both the United States and Europe were deeply committed to protecting the ozone layer. In negotiating the Biosafety Protocol, both the United States and Europe believed strongly that a global agreement could help manage the environmental risks and benefits of biotechnology. In fashioning the PPG-7 and related programs, we have been motivated by a strong, shared commitment to help protect the Amazon rainforest.

Second, we succeed when we recognize that environmental agreements often have significant economic implications. In the case of the Montreal Protocol, our success was based in large measure on finding solutions that allowed businesses on both continents to continue to prosper. In the case of the Biosafety Protocol, our success was based in part on an understanding (perhaps grudging) of economic realities on each side of the Atlantic -- consumer attitudes in Europe and the prohibitive cost of segregating bulk agricultural commodities in the United States. In the case of the Amazon, our successes have come in recognizing that, to protect the rainforest, we must contribute to the livelihoods and well-being of those who live there.

Third, public attention helps us succeed. Ozone depletion, biotechnology, the Amazon rainforest and environmental problems in the former Soviet Union and chemicals management have all, at different times, been the topic of considerable media and public interest. In this regard, the role of NGOs is key. Public attention motivates and informs policymakers, helps command resources for solutions and raises the cost of failure.

Finally, we succeed when we recognize that international environmental agreements must reflect domestic political realities. Prof. Samuel Huntington once wrote about the "Janus-faced nature of defense," meaning that policy-makers must consider both the international and domestic implications of any course of action related to national defense. The same is true for environmental agreements. The agreements we forge with representatives of nations around the world only make a difference if they are implemented at home. That requires an understanding of -- and sensitivity to -- varying national circumstances around the globe.

5. CHALLENGES AHEAD

So what challenges lie ahead? Of course there are many.

We must protect our people from the scourge of toxic chemicals -- in part by concluding a global agreement later this year to eliminate or strictly control the world's most toxic pollutants. To succeed in this endeavor, the US and Europe must be committed to finding common ground.

We must protect biological diversity -- by conserving and protecting forests, by fighting overfishing, by finding new tools for combating the staggeringly expensive problem of invasive species, and more. In all these areas, the US and Europe must find common ground.

We must work together to help provide clean and ample water supplies for people around the world.

Tonight I will focus in particular on two challenges: climate change and environmental standards for export credit agencies. Both are profoundly important to our efforts to protect the planet. Both require us to reach new plateaus in working together, soon.

A. Climate Change

First, climate change. No issue among those we are discussing tonight more regularly commands attention from heads of state. Certainly that is true in my country: Scarcely a week goes by that President Clinton doesn't raise the issue in his public remarks. Climate change has been a regular topic of discussion among G-8 leaders.

The United States and Europe often take strikingly different approaches in these negotiations. Reflecting our success in using emissions trading to meet domestic environmental goals quickly and cheaply, the United States has emphasized the potential benefits of market-based approaches. Reflecting your experience with regional economic integration, Europeans have often emphasized the potential benefits of coordinated policies and measures.

Reflecting the potential of our forests and farmlands to absorb carbon, the United States has sought a role for carbon sinks under the climate treaty. Reflecting your focus on changes in energy and industrial infrastructure, Europeans have been more reluctant.

Reflecting, perhaps, our more legalistic culture, the United States has emphasized the importance of legally-binding consequences for non-compliance with the Kyoto Protocol's emissions targets. Reflecting, perhaps, a more consensual culture of environmental regulation, European negotiators have been more reticent about legally-binding consequences.

Our different constitutional systems play a role as well. Since last fall, European negotiators have been seeking declarations of intent to ratify the Kyoto Protocol by 2002, explaining that such a goal will help to promote ratification in their countries. The United States certainly has no objection to our European colleagues voicing such a goal. But for us, in light of the constitutional prerogative of our Senate to approve treaties and the current skepticism about the Kyoto Protocol in the Senate, voicing such a goal would be counterproductive.

These are some of our differences. But our similarities in these negotiations are far more profound. Both the United States and Europe are convinced that climate change is one of the epic environmental challenges of our time. Both the United States and Europe are deeply committed to reducing greenhouse gas emissions at home. Both the United States and Europe are deeply committed to shaping a treaty that will work to address this problem, and to the success of the Sixth Conference of Parties to the Climate Convention, to be held this fall in The Hague.

The next six months will be important in shaping a treaty that can endure for the decades it will take to solve the challenge of climate change. We will not meet this challenge unless we recognize each other's needs, and work to address them.

B. Environmental standards for export credit agencies

A second issue is export credits. Every year our export credit agencies support investments worth tens of billions of dollars around the globe. These investments have significant impacts on the global environment, both good and bad. Export credits help finance wastewater treatment plants, for example, helping to clean polluted rivers and streams. However, export credits also support environmentally-damaging projects, such as large infrastructure developments in delicate ecosystems.

Last year, G-8 leaders called for common environmental guidelines among export credit agencies by their 2001 Summit. OECD Ministers called on their export credit agencies to develop common approaches to the environment. Work on these issues is proceeding in the OECD Export Credit Group.

In discussions at the OECD and elsewhere, the United States and European countries have taken different positions.

Reflecting our favorable experience with environmental guidelines, the United States has urged the OECD to recommend common standards for export credit agencies, applied in advance. (An example might be a prohibition on lending for large infrastructure projects in protected or sensitive ecosystems). In our view, without such standards, export lending will be a "race to the bottom," with countries competing against each other on the basis of their willingness to support unsustainable or environmentally-damaging projects.

Reflecting in part a lack of experience with environmental guidelines for export credit agencies, and concerns about the technical ability of those agencies to perform environmental assessments, many European governments have been reluctant to support common standards applied in advance. Several have insisted that the OECD do no more than recommend information-sharing among export credit agencies about the environmental impacts of projects.

The next several months will be a critical time in this work. Can we succeed? I believe we can and must, but it will be a challenge.

First, this issue lacks the public profile of other difficult issues where we have come together to find common solutions. Perhaps that is because the topic is inherently technical; perhaps it is difficult to explain in ways that capture the public imagination. But, if history is a guide, without growing attention from environmental groups, the media and the public, finding a solution is less likely.

Second, the issue implicates difficult issues involving economic competitiveness and the roles of different ministries in many governments. If history is a guide, we must recognize these facts as we shape a solution.

Few steps we can take in the next year would pay greater or more immediate dividends for the global environment than shaping common environmental guidelines for export credit agencies. Let us hope that the United States and Europe, together with other nations around the world, can work through the problems and make progress on this topic.

6. CONCLUSION

In 1987, in her forward to Our Common Future, Gro Bruntland wrote: "We live in a time in the history of nations when there is greater need than ever for coordinated political action and responsibility."

That message rings true today. As we go forward to face the epic environmental challenges of our time, we can only succeed by working together. The United States and the nations of the European Union will not always agree on every issue, and may even have serious disagreements. But by working hard to resolve our differences and forge a common approach, we can achieve our common goal -- to protect the global environment, for ourselves and future generations.

[end of document]

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