The G-7 Must Open the `Road From Rio'

IN his speech at the Earth Summit in Rio de Janeiro, President Bush stated, "This is a historic opportunity [but] as important as the road to Rio has been, what is more important is the road from Rio."

The critical first step down this all-important road from Rio is the G-7 Economic Summit in Munich on July 6-8, when the world's seven wealthiest countries will have an opportunity to provide the leadership and direction needed to start making the promise of Rio a reality.

Despite the participants' lofty statements, the Earth Summit's primary task was left unfinished. The integration of environment and development, the goal in Rio, must have roots in the economic system that is the foundation of the G-7's annual gatherings.

Three pressing issues with international economic and environmental ramifications are expected to be on the agenda in Munich. The first, international trade, may have positive effects on the environment by opening up markets and providing for more efficient use of resources. At the same time, because markets do not always internalize environmental costs, activity fostered by liberalized trade without integrating strong corresponding environmental measures can contribute to environmental degradation.

The General Agreement on Tariffs and Trade (GATT) and other trade agreements should be structured to integrate environmental and development concerns and to ensure that they are a tool promoting sustainable development. To accomplish this, the G-7 should encourage the work of the recently convened GATT Working Group on Environmental Measures and International Trade.

That working group should adopt positions to ensure that GATT does not impinge upon the enforcement provisions (including trade sanctions) of the existing or future environmental treaties such as the Montreal Protocol, the Convention on International Trade in Endangered Species, and the treaty on climate change. Moreover, the G-7 should commit to opening the GATT to greater public scrutiny and to ensuring that trade rules do not override the right of countries to adopt strict environmental and health sta ndards.

A second problem which needs action by the G-7 is the antiquated nuclear power plants of the states of the former Soviet Union and Eastern Europe. At Chernobyl, the sarcophagus which was built around the reactor is damaged and in imminent danger of collapsing. If the sarcophagus does collapse, a large amount of highly toxic plutonium dust will be released into the atmosphere.

While the damaged reactor at Chernobyl is the most immediate nuclear power threat, the 15 other Chernobyl-style reactors in the former Soviet Union do not meet any rational safety standards. The design of these reactors is inherently flawed. In addition, the remaining Eastern European nuclear power plants have also been recognized as unsafe and potentially dangerous.

CURRENT foreign-assistance plans appear to focus on upgrading plant equipment and providing plant staffs with additional safety training. But rather than invest money in refurbishing these plants, which may only be able to run for another 10 years, the G-7 should make a higher-yielding investment by promoting the closing of these power plants and focusing on increased energy efficiency and alternative power sources.

To this end, all G-7 bilateral and multilateral assistance to Eastern Europe in the energy and transportation sectors should include an assessment of the cost-effectiveness and environmental benefits of investments in the manufacture of energy-efficient products, in energy systems for appliances or buildings as opposed to new power generation, and in mass transit.

The third and last issue expected to be on the Munich agenda is the financing of international environmental and development projects. During the Earth Summit, the World Bank emerged as a major vehicle for transferring environmental funds to the developing world. Unfortunately, there is alarming evidence of a decline in the quality of bank projects.

The Global Environmental Facility (GEF), which has received a great deal of attention as a mechanism for dispersing the new funds pledged for Agenda 21 and the biodiversity and climate-change treaties, is an untested pilot program.

Moreover, most GEF projects will be linked to larger World Bank loans in areas, such as energy and forestry, where the bank's environmental record is questionable. Restructuring of the GEF and the main body of bank lending is needed to ensure greatly improved accountability.

Rather than discuss the quantity of increased financial assistance, as countries did in Rio, the G-7 should focus on the quality of World Bank assistance, including the G-7's own contributions.

At their gathering in London last year, G-7 leaders devoted substantial attention to the Earth Summit, calling it "a landmark event" and committing themselves to giving the necessary political impetus to its preparations.

British Prime Minister John Major has reportedly proposed to his colleagues a number of follow-up actions to Rio to be agreed on in Munich, including national implementation of the Rio Declaration and Agenda 21 and establishment of the United Nations Commission on Sustainable Development.

At the Munich Summit, the G-7 nations, and in particular the US, can assume a strong role in promoting sustainable development, which is in their vital long-term interests.

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