By Dawn Kristof
The U.S. environmental technology industry won a major victory when the U.S. House of Representatives approved permanent normalized trade relation (PNTR) status with China on May 24. By a 237-197 margin, the House took the first step toward opening up an enormous market for U.S. producers of water and wastewater equipment, with Senate approval of the trade pact expected to follow in the weeks ahead.
With one of the fastest growing economies in the world, coupled with a deteriorating natural resources base, China represents one of the largest potential markets for environmental technology, with wastewater treatment standing out as one of the highest priorities. Nearly 40 percent of China is unserved by sewers, according to the World Bank, with wastewater going directly into lakes and rivers. Among 570 of its largest cities, just over 10 percent, have set up wastewater treatment plants. The nearly $3 billion invested by China in wastewater treatment in 1992 was projected to grow 30 percent each year following.
In light of this enormous market potential, the members of the Water and Wastewater Equipment Manufacturers Association took part in an aggressive campaign to communicate their views to Congress supporting China's entry into the World Trade Organization and calling for immediate passage of legislation granting it permanent normalized trade relations. The reasons were compelling:
- Opportunities for the export of environmental equipment to China will be greatly expanded as a result of the market opening conditions agreed to in the U.S.-China WTO accession deal, namely China's reduction in tariffs and the elimination of non-tariff market barriers. With these concessions, a more open market for the sale of U.S. manufactured water and wastewater equipment to China will create jobs and increase exports for U.S. companies.
- The fair trade provisions of the U.S.-China WTO accession deal will curb the use of trade distorting practices by the Chinese and allow the U.S. to invoke measures to protect against import surges, subsidies and unfair pricing of imports from China to the U.S. With these provisions, U.S. companies will be able to preserve existing jobs and protect their domestic markets against unfair competition.
- Liberalized trade in water and wastewater equipment, coupled with strong and effective regulatory policies, will lead China to better protect and improve its rapidly deteriorating environment, while encouraging sustainable development and environmentally responsible growth.
- Free trade between China and other WTO member nations will bring about a more open economy within China and will serve as an impetus toward achieving meaningful social and political reform.
- The granting of PNTR to China will prevent competitors in other countries from gaining a major advantage in the Chinese market over U.S. companies.
In addition to the above arguments in favor of the proposed legislation, it is equally important to consider the consequences of not granting China PNTR status:
- In all likelihood, China will still succeed in becoming a member of the WTO. Consequently, the denial of normal trade relations by the U.S. will have little effect on their economic relations with other countries and will provide no significant incentive for China to improve its record on human rights or religious and political freedom.
- U.S. companies will lose all of the market access benefits and import protections that were negotiated in last November's U.S.-China WTO accession deal.
- The U.S. will lose any ability to enforce China's trade commitments through WTO rules for dispute settlement.
- Foreign competitors will gain a tremendous advantage over U.S. companies in the Chinese market for water and wastewater treatment equipment. By rejecting PNTR, U.S. manufacturers will risk being denied access to the Chinese market and will suffer discriminatory treatment relative to suppliers from all other WTO member countries.
The members of WWEMA believe the U.S.-China WTO accession deal is extremely favorable to the U.S. and that the arguments in support of permanent normalized trade relations with China are numerous and compelling. Defeat of PNTR would have penalized U.S. exporters of environmental equipment by denying them the ability to compete in the world's most populous market with the greatest need for water and wastewater treatment technologies. This, indeed, was a victorious moment for the U.S. environmental technology industry.
Ontario Plans Million Dollar Package For Victims Of E-Coli Outbreak
Officials in Canada's Ontario province have announced a multimillion-dollar compensation package for residents devastated by a deadly bacterial outbreak if they waive their right to participate in class-action suits.
"Obviously it's going to cost millions of dollars,'' Attorney General Jim Flaherty said Thursday. "This is about doing the right thing. It isn't about money.''
At least seven people died and up to 2,000 others were sickened by E. coli bacteria that turned up in the drinking water in the farming community of Walkerton, 90 miles west of Toronto. Four other deaths are being investigated.
The epidemic - Canada's worst E. coli outbreak - is thought to have been triggered after a torrential May 12 downpour washed manure into the town's wells.
Flaherty said that although Canada's Supreme Court has imposed a limit of $186,000 per person on pain and suffering damages, there is more assistance available from the government of Ontario.
"There can be future loss of income claims, medical expenses not covered by (health care), future rehabilitation expenses that kind of thing, which can result in very large sums of money,'' he said.
"The government is going to a group of victims and saying ... `You're going to be compensated quickly and there is no limit on your compensation,''' said Flaherty, who added that insurance and Ontario's budget surplus would cover the cost.
Although residents who accept government money waive their right to pursue class-action suits, the province said it would fund initial legal fees incurred by residents who decide to seek legal recourse.
At least six law firms have said they plan to launch class-action suits on behalf of residents.
