INDEPENDENT NEWS

Cablegate: Overview of Argentine Environmental Legislation

Published: Thu 10 May 2007 02:56 PM
VZCZCXYZ0000
RR RUEHWEB
DE RUEHBU #0905/01 1301456
ZNR UUUUU ZZH
R 101456Z MAY 07
FM AMEMBASSY BUENOS AIRES
TO RUEHC/SECSTATE WASHDC 8081
INFO RUEHBR/AMEMBASSY BRASILIA 6016
UNCLAS BUENOS AIRES 000905
SIPDIS
SENSITIVE
SIPDIS
BRAZILIA FOR ESTH HUB JAMES STORY
OES/ETC FOR JAN MCALPINE AND CATHY KARR-COLQUE
OES/EGC FOR BARBARA DEROSA-JOYNT
E.O. 12958: N/A
TAGS: EAGR ENRG SENVSPL PREL ETRD AR
SUBJECT: OVERVIEW OF ARGENTINE ENVIRONMENTAL LEGISLATION
2007
REF: BA 0289
1. (U) This telegram is sensitive but unclassified, and not
for Internet distribution.
2. (U) There are four major pieces of environmental
legislation that have either recently passed or will be on
the Argentine national agenda in 2007. These include new
laws and proposed legislation on the legal status of the
heavily polluted Riachuelo river basin, the promotion of
biofuels, the protection of native growth forests and the
rational use of non-renewable natural resources. This cable
outlines that legislation. End Summary
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NEW LAW: RIACHUELO RIVER BASIN CLEANUP
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3. (U) In 2006, the Argentine executive branch authored
legislation to designate the Riachuelo river basin as a
publicly held entity under the national Secretary for the
Environment. The legislation came into force in late
December 2006. The Riachuelo, which flows exclusively
through the jurisdictions of the province and city of Buenos
Aires, is among the most polluted rivers in the hemisphere.
Environment and Sustainable Development Secretary Romina
Piccolloti has made its clean-up and remediation her
signature project. The legislation grants the Secretariat
wide authority over the land and neighborhoods that abut the
river and whose groundwater and sewage systems empty into it.
That authority includes the right to close companies that do
not comply with Secretariat directives.
4. (SBU) COMMENT: Piccolloti is close to President Kirchner.
She came to national attention as one of the most vocal
proponents of the Argentine movement to halt Uruguay's
construction of a paper mill -- a major irritant in
Argentina-Uruguay bilateral relations. Her tenure in the
position was coincident with a move of the Secretariat from
within the Ministry of Health to a position immediately under
the President,s Chief of Staff. Many observers believe that,
as a result, she invests her position with more power than it
has traditionally held. The Secretariat is currently using
that power to negotiate with companies and landowners it
wishes to relocate from the area surrounding the river.
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NEW LAW: BIOFUELS PROMOTION
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5. (SBU) In February 2007, President Kirchner signed a new
law for the promotion of the study, development, production,
and use of biofuels (Reftel). Experts from NGOs and private
firms have noted that while the passage of the law represents
a positive trend towards recognition of Argentina,s vast
potential as a biofuels producer and exporter, the law itself
will do little to stimulate growth in the industry. Industry
experts have been less charitable, telling the DCM during a
biofuels roundtable in March that the new law is deeply
flawed, noting that it appears esigned to allow the
government to micromanage production decisions. Producers
are especially concerned by a provision that calls for the
federal government to set tax incentive rates on an annual
basis, making a stable and predictable market nearly
impossible. The biofuels producers also advised that,
without significant changes to the agricultural subsidy
programs in the U.S. and Europe and changes to Argentine
domestic assistance to fossil fuel producers, Argentine
biofuels will remain largely uncompetitive.
6. (SBU) Political analyst Natalia Machain from the
influential Argentine environmental NGO "Fundacion Ambiente y
Recursos Naturales" told Emboff that the law, which uses a
complicated set of tax incentives to spark investment, is
only valuable in that it "begins a discussion about
alternative fuels." A central provision of the law requires
all petroleum vehicle fuel to include a minimum of 5 percent
biofuels by 2010. Machain noted in a May 4 meeting with
Emboff that, while the domestic 5 percent rule has received
significant press, the legislation was created primarily with
a view towards Argentina's future as a biofuels energy
exporter. Though Argentina is widely agreed to have great
biofuel productive potential, the industry is currently
insignificant.
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BILL: PROTECTING NATIVE FORESTS
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7. (U) In May 2006, Chairman of the lower house,s Natural
Resources Committee Deputy Miguel Bonasso (Convergencia )
Capital Federal) introduced legislation to establish minimum
protection standards for native growth forests (forests which
are primarily comprised of indigenous species). Such forests
have been devastated by the expansion of soy and other
commodity farming in northern Argentina. The bill calls for
a one year moratorium on the sale of publicly held forest
land, during which a sustainable management system can be
created. In March 2007 the bill passed the lower house and
is currently under review in the Senate.
8. (SBU) Greenpeace Argentina reports that the federal
legislation may be ineffective due to state vs. federal
constitutional questions. Further complicating its
prospects, FARN political analyst Machain told Emboff that no
less than seven Senate committees claim jurisdiction over the
bill and that the likelihood of passage is dismal. Machain
said that without President Kirchner or his wife Christina's
personal intervention and support, the bill will almost
certainly die in committee.
9. (U) COMMENT: The majority of native growth forests are
considered provincial resources and are therefore controlled
by provincial governments. Argentine provincial governments
tend to guard their independence closely. Should the
legislation pass, the provinces are unlikely to view
themselves as bound by the proposed federal legislation,
setting up a long constitutional battle.
10. (U) COMMENT CONT'D: Argentine native growth forests in
the northern provinces of Formosa, Chaco, Corrientes, and
Misiones have been nearly obliterated since 2001. High
worldwide commodity prices, consequently skyrocketing land
values, and provincial government corruption have combined
over the last six years to confine once abundant forests to
only the most mountainous terrain. Most environmental
observers agree that the proposed legislation is a case of
"too little too late." End Comment.
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BILL: NONRENEWABLE NATURAL RESOURCES
------------------------------------
11. (U) Chairman Bonasso has also introduced a bill to
establish minimum environmental protection standards for the
use of nonrenewable natural resources.8 The bill
has potentially wide-ranging implications. Its primary
objective is to ensure that the commercial use of
nonrenewable resources does not adversely affect the quality
of life of local populations. It classifies as nonrenewable
all mineral resources, petroleum, natural gas, and coal. The
bill's most controversial measure calls for export controls
on all such resources. The bill would authorize export of
nonrenewable resources only if the verified domestic reserves
for that resource exceed ten times the yearly domestic
consumption.
12. (SBU) Esteban Bicarelli, the Director of the Argentine
political consulting firm Blapp, told EmbOff the bill is not
expected to proceed quickly. In the near term, he noted that
all bills concerning mineral resources are required to move
through lower house,s Energy Committee, whose chairperson is
currently running for Vice-Governor of the Tierra del Fuego
province and is unlikely to take up any new business. The
bill will also likely meet with strong opposition from
provincial legislatures whose economies rely on the
potentially affected industries.
MATERA
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