Environmental Assessments and Capacity Building  for Trade Liberalization in the Americas: MERCOSUR


The assessment for Argentina was conducted with Fundación Ambiente y Recursos Naturales and it aimed to study the possible economic effects of the proposed Free Trade Area of the Americas (FTAA). This assessment looks at some of the key environmental issues in identified sensible sectors such as the meat industry, oil and its derivates, sugar processing, soy production, iron and steel making, and non-metallic mining the mentioned sectors. It also highlights the need for an in-depth life cycle analysis, in particular for the soy sector, given the high demand, growth of the activity and the nature of the social and environmental effects of its production. One of the conclusions of this assessment is the need for a formal communication mechanism between policy makers in different sectors, towards the integration of sustainability into trade and public policy overall. Download complete publication.


In Brazil, the assessment focused on the industrial sector and indicated that the main environmental changes with the possible implementation of FTAA could include water contamination and detriment in air quality due to outdoor air pollution.  However, the assessment highlights that those industries that could affect air quality in Brazil use environmentally friendly technologies in order to meet sustainability and market access requirements of the export markets.  Additionally, this assessment examines the Brazilian legal-institutional frameworks and the internalization of environmental cost by industry, concluding that these costs do not affect competitiveness. Finally, this assessment includes some recommendations for regulating entities in terms of promoting efficiency and competitiveness of the Brazilian industrial sector. Download complete publication.

Summary table with economic, social, environmental and legal/institutional impacts of trade liberalization for key sector in Brazil.


The sectors analyzed in the assessment conducted with the Paraguayan Institute for Environmental Law and Economics for Paraguay, were soy and cotton, the later being slightly replaced by soy production that has practically become a monoculture of in Paraguay. The economic impacts of the fast growth in soy production with free trade were analyzed in the assessment, as well as the environmental and social effects, including, soil erosion, loss of biodiversity and jobs, due to the mechanic nature of soy production and spread of some diseases that had been previously eradicated. This assessment includes key policy recommendations for agricultural diversification and integration of sustainability into public policy and decision making.  Download complete publication.


The outcomes of the assessment conducted with Ecos in Uruguay, highlight that the meat and wool sectors could have economic opportunities with trade liberalization. Paper and rice show slightly negative economic impacts in the analysis. The environmental effects derived from changes in the sectors with economic opportunities were not considerable, because of existing controls applicable for example to the meat industry. However, the assessment indicates that in the forestry sector there are serious impacts due to the cultivation of non native species and soil erosion. Another issue considered, is a notable tendency of increasing production of soy to meet international demand. This is also causing expansion of the agricultural frontier and additional pressure on soil due to replacement of native forest for agricultural purposes. Coordination within MERCOSUR for sustainable development policies and a common agricultural policy, are some of the recommendations of this assessment. Download complete Publication

Summary table with economic, social, environmental and legal/institutional impacts of trade liberalization for key sector in MERCOSUR





This page was last updated on Wednesday September 29, 2010.