Bulk Water Trade Between Canada and the US

Undergraduate Paper University of Calgary April 2008

Contents

Page A !"T#$%UCT!$" & 2 US %e'and for Bulk Water (istori)al Ba)kground of Canadian Water #esour)es a Previous atte'pts to provide +ulk water to the USA + $pposition to atte'pts to e,port water - environ'ental issues B PU#P$S/ $0 STU%1 A"% APP#$AC( C A"A31S!S & 2 * 4 /)ono'i) /)ologi)al +alan)e Politi)al 3egal & & * * . 2 2 2 8 &0 && && && && && &2 &2 &2 &*

% SU55A#1 $0 A#6U5/"TS /)ono'i) /)ology Politi)al 3egal / C$"C3US!$" 0 #/C$55/"%/% C$U#S/ $0 ACT!$" 6 #/0/#/"C/S

Bulk Water Trade Between Canada and the US

A !"T#$%UCT!$" & US %e'and for Bulk Water 5ost Canadians re)ogni7e the United States as Canada8s +est trading partner and friend9 and understand that trade +etween the two )ountries is vital to +oth e)ono'ies 1et Canadians and A'eri)ans also pri7e the prin)iple of independen)e They understand that whenever a nation no longer )ontrols the ne)essities of life9 its )iti7ens are no longer free or safe Water not only defines Canada8s geography +ut regularly 'onopoli7es its politi)al )onversations 0or 'ore than four de)ades Canadians have de+ated a variety of +illion: dollar s)he'es to e,port water to the United States and have re;e)ted the' as +eing either a threat to national se)urity or a )ra7y e)ono'i) venture Whenever disputes have arisen with its A'eri)an neigh+ors over shared waters9 Canada has su))essfully engaged the !nternational Boundary Waters Treaty A)t of &<0< and the !nternational =oint Co''ission9 )reated under the A)t to address +oundary waters issues !n re)ent years9 shortages in water supply in the US have in)reased together with pressure to trade water >in +ulk? to that )ountry a'id in)reasing )lai's of water a+undan)e in Canada The issue of water +e)a'e alive with the signing of the Canada:US 0ree Trade Agree'ent >CU0TA? in &<8< and "A0TA in &<<* /ver sin)e9 )iti7ens and e)ono'ists alike have asked a +asi) @uestionA !s water in its natural state now a trada+le good su+;e)t to li+erali7ed trade rulesB Today there is pressure to in)lude water as a trada+le )o''odity in the rules of the "orth A'eri)an Trade Agree'ent >"A0TA? There has +een pressure to allow trade in Canadian water This has in)reased with the esta+lish'ent in 200. of the Se)urity and Prosperity Partnership or SPP !n a very real sense9 Canada8s water is already Con the ta+leD as )urrent legislation in the Canadian govern'ent does not prote)t it fro' +eing traded away !n the 'eetings of "A0TA and other trade organi7ations9 the )ontroversial )on)ept of )ontinental water integration or Cinterdependen)eD in)reasingly do'inates talks +etween the US and Canada This )on)ept is +ased on one of two assu'ptionsA first9 Canada has a CsurplusD of water and therefore9 large a'ounts of water )an +e 'oved fro' one +asin in Canada to another in the US without unduly affe)ting the environ'ent The se)ond assu'ption is that water9 like oil or gas9 is a trada+le )o''odity and it is per'issi+le to trade it and run the risk of degrading one pla)e for the +enefit of another A)ade'i)ians in Canada )ontend that +oth of these assu'ptions are false They su+s)ri+e to the prin)iple that wise 'anage'ent9 prudent )onservation and responsi+le stewardship of water are a+solutely ne)essary for the long:ter' environ'ental health and e)ono'i)

prosperity of +oth )ountries This prin)iple )an +e paraphrased as EFeep water within its natural +asin9 treat it with respe)t9 and use it effi)iently E /very year the "orth A'eri)an 0oru' on !ntegration9 a 5ontreal organi7ation dedi)ated to greater )ontinental )ooperation9 holds a 'o)k "orth A'eri)an parlia'ent )alled CTriu'virate D This organi7ation provides insight into prevailing thinking on e)ono'i) and politi)al issues that affe)t Canada9 5e,i)o and the United in the near future At the 'ost re)ent session held in 5ay 20029 2* university students fro' the three )ountries gathered at A'eri)an University in Washington %CG in 'o)k de+ate They dis)ussed a +road range of issues in)luding )usto's unions9 tele)o''uni)ations and hu'an traffi)king But water do'inated these issues 5e'+ers of the United States delegation openly pushed for +ulk water ship'ents fro' Canada The Canadians opposed the 'ove9 arguing that water e,ports posed Ca national se)urity threat D !n the end the delegates agreed that Canada8s position was Cun pro+le'a para el futuroD >Ca pro+le' for the futureD? But the A'eri)an delegation )onsidered it a pro+le' for now %uring the week:long session9 they de'anded that Canadians support a proposal to provide per)ent of their annual duties for the purposes of )ontinental defense !f the Canadians refused9 the A'eri)ans pro'ised to push for greater Ca))ess to Canadian natural resour)esD in)luding water The do'inant trading partner prevailedA the Canadians ulti'ately a)@uies)ed and agreed to pay for a "orth A'eri)an defense peri'eter Although organi7ers )hara)teri7e the Triu'virate as an e,er)ise C+eyond any )ultural realityD9 3ouis Al+erta 5oreno9 the president of the !nter:A'eri)an %evelop'ent Bank9 put the affair into )learer perspe)tive CThe Triu'virate is an e,)ellent e,a'ple of the i'portan)e and depth of "orth A'eri)an integration9D said 5oreno Today9 Canada8s water - through diversion9 transfer9 sale9 trade or all of the a+ove - is on the negotiating ta+le in CanadaHUS relations !n the long:ter' agenda within the )onte,t of freer trade and in)reased "orth A'eri)an integration9 Canada8s water is up for gra+s As long as its status as a negotia+le resour)e re'ains un)lear9 pressure to a))ess Canada8s water will )ontinue to grow ever stronger There is now a for'al fra'ework for dis)ussing Canada8s water as a trade ite' - the Se)urity and Prosperity Partnership >SPP? - whi)h 'et 'ost re)ently in August 2002 at 5onte+ello9 Iue+e) under the auspi)es of Pri'e 5inister Stephen (arper9 US President 6eorge W Bush and 5e,i)an President 0elipe Calderon $ver the ne,t twenty years9 the United States is e,pe)ted to intensify ongoing efforts to )onserve freshwater in all se)tors !f and when these 'easures are not enough9 even where they )an +e supple'ented +y desalination and other te)hnologies9 then i'portation of freshwater fro' elsewhere 'ay well +e)o'e again the favoured option The west 'ight look for water first fro' Alaska to +e transported +y tanker or undersea pipeline The Colorado +asin states 'ight look first to the lower Colu'+ia #iver with the water to
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+e transported +y pipeline overland States in the A'eri)an 5idwest and south >via the 5ississippi #iver? would look to the 6reat 3akes as the target of )hoi)e 2 (istori)al Ba)kground of Canadian Water #esour)es a Previous atte'pts to provide +ulk water to the USA Several private se)tor s)he'es to e,port +ulk water to the United States re)eived a rough ride fro' the Canadian pu+li)9 whi)h re;e)ted any suggestion that their water resour)es were C)ontinentalD rather than Canadian Argu'ents in favour of water e,port nor'ally are pro'pted +y 'onetary gains9 +oosting develop'ent in sour)e regions9 and so'eti'es the provision of hu'anitarian aid The opposing view a)knowledges that water is an e)ono'i) good9 +ut insists it is so 'u)h 'ore than thatA !t is the +asis for all life9 not ;ust hu'an !t is integral to the health and +eauty of Canada8s lands)ape9 the key to the past and the future !f water9 the last and greatest natural resour)e still in Canadian hands9 is traded away9 Canadians will +e redu)ed to a lower status9 sovereign in na'e only Pu+li) fears over plans to e,port +ulk water e,ist despite the tenden)y of Canadian govern'ents to dis'iss international water diversion proposals as wild pipe drea's By avoiding syste'ati) reviews and +y failing to )hoose a poli)y )ourse9 govern'ent appears to +e keeping its future options open At the federal level9 opposition to e,port proposals have +een less than )onvin)ing !t )onsisted of defensive responses +y a series of federal 'inisters responsi+le for water resour)es9 rather than an offi)ial poli)y endorsed +y the federal govern'ent Snowcap and Sunbelt ventures in British Columbia. While the Canadian govern'ent )lai'ed that its parti)ipation in free trade negotiations was no threat to Canadian sovereignty over water resour)es9 it was slow to respond to related develop'ents at the provin)ial level "one of the provin)es had opposed the 0ederal Water Poli)y of &<82 or the provisions of federal Bill C:&.J whi)h allows s'all:s)ale water e,port (en)e9 four provin)es +egan to flirt with entrepreneurs intent on shipping Canadian water to foreign 'arkets The Provin)e of British Colu'+ia >BC? @uietly de)ided in &<8J to per'it entrepreneurs to e,port s'all volu'es of freshwater fro' its )oastal strea's +y 'arine tanker $ne of its si, li)ensees9 Snow)ap9 eventually partnered with an A'eri)an fir'9 Sun Belt9 and in &<<& they found a 'arket in 6oleta9 California that was suffering fro' drought Before they )ould sign a )ontra)t to ship water to 6oleta9 however9 the BC govern'ent found itself e'+roiled in )ontroversy9 as the news a+out Snow)ap triggered a flood of new e,port appli)ations These in turn alar'ed

environ'entalists who were worried a+out the )u'ulative effe)ts of further +ulk water re'ovals on the 'arine environ'ent !n response to the pu+li) uproar9 the Provin)e pla)ed a 'oratoriu' on new or e,panded li)enses As a result9 Snow)ap )ould not o+tain enough additional water to satisfy its )ontra)t and was rei'+ursed +y the Provin)e for its out:of:po)ket e,penses (owever9 the Provin)e refused to re)ogni7e Sun Belt9 whi)h was not na'ed on the li)ense Sun Belt8s A'eri)an owner threatened to sue Canada under Arti)le && of "A0TA +ut has sin)e apparently given up his a)tion Una+le to re)eive any assuran)e of federal legislation opposing +ulk water e,ports9 BC eventually passed its own Water Protection Act in &<<. !n 5ay 200J9 the Poli)y #esear)h !nstitute or P#! also pu+lished an arti)le +y University of Calgary professor %i,on Tho'pson listing si, 'andatory )onditions for water e,port proposals These wereA an environ'ental i'pa)t assess'ent showing no da'age to the +asin9 proof of e,porta+le surplus9 eviden)e of finan)ial +enefits to the +asinG )onfir'ation of a realisti) 'arket9 a +usiness plan9 and a provision to audit the pro;e)t >Si'ilar standards were re)o''ended and re;e)ted for governing water diversions out of the 6reat 3akes in 2004 on the grounds that they would di'inish lo)al water se)urity ? Tho'pson )on)luded that it was entirely possi+le that Cthe United States will de'and a))ess to what it thinks of as a )ontinental resour)e D /arly in 20029 the Center for Strategi) and !nternational Studies >CS!S? a private US think tank9 whi)h in)ludes trustees su)h as (enry Fissinger9 together with the Conferen)e Board of Canada laun)hed the "orth A'eri)an 0uture 202. Pro;e)t to assist the Se)urity and Prosperity Partnership >The Center9 whi)h played a )riti)al role in "A0TA8s adoption in the United States9 has pu+lished several )o''entaries on integration in)luding a newsletter )alled The "orth A'eri)an !ntegration 5onitor? The 0uture 202. Pro;e)t proposed Cto analy7e9 )o'prehend and anti)ipate "orth A'eri)an !ntegrationD +y holding a series of )losed:door roundta+les on i''igration9 energy9 se)urity9 )o'petitiveness and water with the goal of reporting its findings to the e,e)utive and legislative +ran)hes of Canada9 5e,i)o and the United States +y the end of Septe'+er9 2002 (owever the pro;e)t8s 2.:page agenda was leaked to the 'edia in April 20029 ;ust prior to a Calgary roundta+le on the 0uture of the "orth A'eri)an /nviron'ent The do)u'ent laid out plans for )ontinental water trade in the +oldest ter's !n plain words9 the do)u'ent pointed out the relative s)ar)ity of water in the United States and 5e,i)o9D and de)lared the a+undan)e of water in Canada and that it shared 'any watersheds along the US +order in)luding the 6reat 3akes The do)u'ent advo)ated a 'ore proa)tive approa)h in e,ploring solutions +eyond the )urrent trans +oundary agree'ents anti)ipating that water availa+ility9 @uality and allo)ation are likely to undergo profound )hanges +etween 200J and 202.

$ne option in)luded new Cregional agree'ents +etween Canada9 the United States and 5e,i)o on issues su)h as water )onsu'ption9 water transfers9 artifi)ial diversions of fresh water9 water )onservation te)hnologies for agri)ultural irrigation and ur+an )onsu'ption D !t also noted the need for the three govern'ents to over)o'e +ureau)rati) and legal o+sta)les if "orth A'eri)a desires to a)hieve ;oint opti'u' utili7ation of the availa+le water Signifi)antly9 The 0uture 202. Pro;e)t do)u'ent does not 'ention the Boundary Waters Treaty of &<0< +etween Canada and the United States or the !nternational =oint Co''ission Ar'and Pes)hard:Sverdrup9 a for'er senior )onsultant with /)onolyn, !nternational in $ttawa9 and now dire)tor of the 5e,i)o Pro;e)t for the Center as well as the "orth A'eri)an 0uture 202. Pro;e)t9 later )onfir'ed that water was o+viously on the ta+le (e predi)ted that the US will need water and Canada Chas an overa+undan)e and arrange'ents +etween the two )ountries will eventually +e 'ade + $pposition to atte'pts to e,port water - environ'ental issues A threat to Canada8s water 'ore sinister than the 6#A"% Canal Co'pany was e'erging Although it is not widely known9 it was Canada9 not the US9 that initiated the re@uest for +ilateral talks on free trade in the &<80s 3ater it was dis)overed that Si'on #eis'an9 appointed as )hief trade negotiator +y the Pri'e 5inister9 was not only a dire)tor of the 6#A"% Canal Co'pany +ut had 'ade a spee)h in whi)h he suggested that A'eri)ans would go )ra7y for a))ess to Canadian freshwater9 and urged that the resour)e +e used as +ait to get the A'eri)ans to the negotiating ta+le !n an atte'pt to settle the water e,port issue +efore it +e)a'e entangled with the Conservative govern'ent8s larger a'+ition of se)uring an agree'ent with the United States on trade li+erali7ation9 the federal Ca+inet approved the in)lusion of a state'ent li'iting e,port within its new 0ederal Water Poli)y9 whi)h was ta+led in the (ouse of Co''ons in "ove'+er &<82 !n his introdu)tion9 the /nviron'ent 5inister indi)ated that the C6overn'ent of Canada e'phati)ally opposes large:s)ale e,port of our waterD +e)ause of inade@ua)ies of supply in so'e regions and seasons and +e)ause the re@uired diversion pro;e)ts would +e har'ful to the environ'ent and to northern )o''unities >/nviron'ent Canada9 &<82? An e,)eption would +e allowed9 however9 for s'all:s)ale e,ports that would +e regulated )losely in )ooperation with provin)es Thus the govern'ent 'ade a )o''it'ent to Cstrengthen federal legislation to the e,tent ne)essary to fully i'ple'ent this poli)y D The i''ediate pu+li) rea)tion to the federal poli)y state'ent was positive !t appeared that the only re'aining task was to reinfor)e the poli)y on e,port with legislation At a leisurely pa)e9 staff +egan drafting a +ill to +an the e,port of water !n the spring of &<889 staff went into overdrive The reason for this a))eleration of a)tivity was 'ounting )riti)is' that the language of the draft 0ree Trade Agree'ent would give the United States unpre)edented a))ess
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to Canadian water resour)es9 notwithstanding assuran)es to the )ontrary in the 0ederal Water Poli)y Although the 6overn'ent of Canada repeatedly denied this )harge9 the heat was turned up during the su''er of &<88 as widespread drought gripped the )ontinent and &* southern US senators led an a+ortive effort to have the US Ar'y Corps of /ngineers triple the diversion of water fro' the 6reat 3akes at Chi)ago to keep +arges afloat on the 5ississippi #iver >Sasser et al., &<88? !n response to these events9 on August 2.9 &<88 the federal 5inister of the /nviron'ent9 @ui)kly ta+led for first reading in the (ouse Bill C:&.J9 to +e known as the Canada Water Preservation Act The +ill would have prohi+ited9 without e,)eption9 any e,port9 or diversion into +oundary waters for the purpose of e,port9 of water a+ove the average daily rate of one )u+i) 'etre per se)ond or annual volu'e of 209000 )u+i) de)a'eters9 a very )onservative allowan)e for 'ost parts of Canada The +ill per'itted the 5inister to )onsider li)ensing e,ports +elow this level9 after undertaking environ'ental i'pa)t assess'ents and setting ter's and )onditions (is duties )ould +e delegated to a provin)e to )arry out The +ill would not apply to +ottled water >Canada9 &<88? Within a few weeks of introdu)ing this +ill9 and +efore its ter's )ould +e )onsidered +y a Parlia'entary )o''ittee9 the federal govern'ent )alled a general ele)tion Bill C:&.J died on the order paper Although so'e )riti)s had raised )on)erns a+out the a+ility of Bill C:&.J to prevent the e,port of water9 enough voters were reassured +y the govern'ent8s a)tions to help the Conservatives win re:ele)tion with a 'andate to pro)eed with free trade The govern'ent a)hieved what it 'ost wanted9 and the Canada:United States 0ree Trade Agree'ent took effe)t on =anuary &9 &<8< The Canada Water Preservation Act +ill9 however9 was never reintrodu)ed to Parlia'ent Water e,port < opponents were +a)k to s@uare one9 and in ter's of prote)ting Canada8s water9 worse was yet to )o'e !n &<<*9 the 3i+erals under =ean Chretien were ele)ted in $ttawa (aving opposed free trade with the United States when in $pposition9 the new govern'ent then a+ruptly reversed itself and e'+ra)ed negotiations to in)lude 5e,i)o and to e,tend the s)ope of trading rules in a "orth A'eri)an 0ree Trade Agree'ent >"A0TA? 3ike the Conservatives +efore the'9 the 3i+eral govern'ent de)lined to negotiate an e,e'ption for freshwater in the te,t of the trade agree'ent9 even though e,e'ptions had already +een negotiated for raw logs and unpro)essed fish !nstead9 the Pri'e 5inister8s $ffi)e issued a 'edia release stating that the three govern'ents were in agree'ent that nothing in "A0TA would o+lige the water +elonging to any of the parties in its natural state to +e e,ported >Canada9 &<<*? Unfortunately9 the ;oint agree'ent appended to the 'edia release was not signed (ow su)h a state'ent would +e treated in a trade panel hearing is open to @uestion

B PU#P$S/ $0 STU%1 A"% APP#$AC( !n general9 the purpose of this study is to deter'ine whether or not Canada should supply +ulk water to the USA Spe)ifi)ally9 the purpose is to deter'ine whether it is feasi+le to pursue this 'ove in ter's of +enefits su)h asA /)ono'i) gainsG /)ologi)al +alan)eG 5utually +enefi)ial politi)al relations- "A0TA9 relations with the US and other )ountriesG and A +inding legal fra'ework- legislation9 )onstitutional provisions

C A"A31S!S Advantages and disadvantages as the 'oves i'pa)t on Canadian national interest 1. Economic Previous attempts small scale deliveries. A few unsu))essful atte'pts were 'ade to trade in +ulk water !n &<8J9 the provin)e of British Colu'+ia >BC? @uietly de)ided in &<8J to per'it entrepreneurs to e,port s'all volu'es of freshwater fro' its )oastal strea's +y 'arine tanker $ne of its si, li)ensees9 Snow)ap9 eventually partnered with an A'eri)an fir'9 Sun Belt9 and in &<<& they found a 'arket in 6oleta9 California that was suffering fro' drought Before they )ould sign a )ontra)t to ship water to 6oleta9 however9 the BC govern'ent found itself e'+roiled in )ontroversy9 as the news a+out Snow)ap triggered a flood of new e,port appli)ations These in turn alar'ed environ'entalists who were worried a+out the )u'ulative effe)ts of further +ulk water re'ovals on the 'arine environ'ent !n response to the pu+li) uproar9 the Provin)e pla)ed a 'oratoriu' on new or e,panded li)enses As a result9 Snow)ap )ould not o+tain enough additional water to satisfy its )ontra)t and was rei'+ursed +y the Provin)e for its out:of:po)ket e,penses (owever9 the Provin)e refused to re)ogni7e Sun Belt9 whi)h was not na'ed on the li)ense Sun Belt8s A'eri)an owner threatened to sue Canada under Arti)le && of "A0TA +ut has sin)e apparently given up his a)tion Una+le to re)eive any assuran)e of federal legislation opposing +ulk water e,ports9 BC eventually passed its own Water Protection Act in &<<. $n April 2.9 &<<89 the Sault Ste. Marie Star reported that a regional offi)e of the $ntario 5inistry of the /nviron'ent had granted a per'it to the "ova 6roup9 a lo)al )o'pany9 to re'ove ten 'illion liters of water a day for up to si,ty days a year fro' 3ake Superior

for e,port to Asian 'arkets "o govern'ent on either side of the international +oundary as well as the Canadian 5inistry of "atural #esour)es had +een )onsulted a+out the proposal The volu'e of water involved was an insignifi)ant fra)tion of the late9 +ut the e)ono'i)s of the venture were du+ious To prevent a dangerous pre)edent fro' o))urring9 the provin)e of $ntario res)inded the per'it Unsure economic gain. The profita+ility of +ulk water trading9 whether +y )ontainers or through pipeline9 has not +een a))urately pegged Shipping )osts )an +e prohi+itive as the pri)e of )rude oil )ontinues to +e volatile 3ikewise9 laying the stru)ture of a pipeline fro' Canada to the US is for'ida+le inas'u)h as 'a;or Canadian rivers flow either northward or eastward9 not towards the USA Possi+le sour)es of water are lakes near the +order like 3ake $ntario (owever9 areas in the USA that need water are lo)ated south or southwest whi)h are far fro' possi+le sour)es of piped:in water Possi+ly in the future when a@uifers +e)o'e so )onta'inated with salt and )he'i)al to,in that safe water for drinking and irrigation +e)o'es a pre)ious )o''odity9 will +ulk water trading +e profita+le at pri)es higher than oil This9 however9 will +e )ontingent on stri)t e)ologi)al standards rather than politi)al or e)ono'i) feasi+ility 2. Ecological balance Long term prospects o! clean water suppl" and ecological balance 5arlowe (ood of the Asso)iated Press )ited a United "ations study whi)h pro;e)ted that +y 202.9 fully a third of the planetKs growing population )ould find itself s)avenging for safe drinking water 5ore than two 'illion people in developing )ountries9 the vast 'a;ority of the' )hildren9 die every year fro' diseases )aused +y unsanitary water There are a nu'+er of interlo)king )auses of this s)ourge 6lo+al e)ono'i) growth9 population pressures and the rise of 'ega:)ities have all in)reased water use to re)ord levels 5e,i)o City9 =akarta and Bangkok9 to na'e a few9 have underground water sour)es :: so'e of the' nonrenewa+le :: depleting at alar'ing rates !n Bei;ing9 ho'e to &J 'illion9 a@uifers have fallen +y 'ore than a do7en 'eters >40 feet? in *0 years9 for)ing the govern'ent to ear'ark tens of +illions of dollars for a s)he'e to ferry water fro' the 1angt7e #iver in the south to the )ountryKs par)hed north Aggravating the shortages are pathogen and )he'i)al pollution9 whi)h have transfor'ed 'any pri'ary sour)es of water in the developing world into to,i) repositories of disease

The British ;ournal Nature reported that a tea' of resear)hers )o''ented that in de)ades to )o'e9 water s)ar)ity 'ay +e a wat)hword that pro'pts a)tion ranging fro' wholesale population 'igration to war9 unless new ways to supply )lean water are found #ising sea levels are already for)ing salt water into a@uifers +eneath 'ega deltas that are ho'e to tens of 'illions9 and )hanging weather patterns are set to intensify droughts in large areas of Afri)a9 southern /urope and Asia9 a))ording to U"Ks !ntergovern'ental Panel for Cli'ate Change >!PCC? /,perts and poli)y 'akers point to three +road )ategories of initiatives to ease the shortage of )lean9 drinka+le water9 espe)ially in the worldKs poorest regionsA >&? sanitation9 >2? purifi)ation9 and >*? water 'anage'ent EPoor sanitation )o'+ines with a la)k of safe drinking water and inade@uate hygiene to )ontri+ute to the terri+le glo+al death toll9E U" Se)retary:6eneral Ban Fi:'oon said earlier this 'onth 3ess than half the households in 'a;or Asian )ities are )onne)ted to sewers9 whi)h 'eans that tons of raw sewage runs into rivers and o)eans9 a))ording to the U" !n 3atin A'eri)a and Afri)a that figure drops to 40 and 20 per)ent9 respe)tively While govern'ents atte'pt to i'prove sanitation infrastru)ture9 s)ientists are developing new te)hnology to purify the water availa+le9 a))ording to 5ark Shannon9 a professor at the University of !llinois and %ire)tor of the US govern'ent funded Center of Advan)ed 5aterials for the Purifi)ation of Water with Syste's (e reported that desalination with reverse os'osis is already the largest single growth area in ter's of new water supplies "ew te)hni@ues of reverse os'osis use 'e'+ranes with nano'eter:si7e pores to filter out salt and other )onta'inants fro' water9 and )ould for the first ti'e pave the way for industrial:s)ale use 5i)ro:filters are also used to de)onta'inate +odies of water in)reasingly la)ed with pesti)ides9 arseni)9 heavy 'etals9 nitrates and phar'a)euti)al derivatives Current 'ethods of de)onta'ination9 however9 re'ain E)hallenging9 e,pensive and unrelia+le9E said Shannon9 Cand will take years to perfe)t D A third 'ethod of purifi)ation :: and the one 'ost relevant to the poor nations :: is re'oving or killing +a)teria9 viruses and other pathogens through disinfe)tion Shannon said that pathogens are still the +iggest pro+le' in the world today in ter's of safe water With worldwide food produ)tion set to e,pand .0 per)ent +y 20*09 s)ientists are also developing geneti)ally 'odified grain plants that )onsu'e less water and )an withstand harsh )onditions #esear)hers in the US9 for e,a'ple9 have developed geneti)ally

engineered ri)e with a higher toleran)e for drought9 salt and low te'peratures9 the three 'ain )auses of )rop failure #. Political $mpact on Canada US relations The water situation is drawing Canada and the US )loser toward solutions The "ova 6roup in)ident in &<<8 pro'pted the Canadian and US govern'ents to agree on a ;oint referen)e to +e given to the !nternational =oint Co''ission to investigate the i'pli)ations of )onsu'ption9 diversion and e,port of 6reat 3akes waters The Canadian govern'ent also 'oved to prohi+it all +ulk water e,ports and not ;ust large:s)ale e,port (owever9 trade lawyers and poli)y e,perts opined that the federal govern'ent )ould not adapt Bill C:&.J or the Canada Water Preservation Act to legislate a prohi+ition on water e,port fro' Canada "either the "A0TA nor the World Trade $rgani7ation would tolerate a )ountry restri)ting water e,pli)itly for use within national +oundaries as this )onstitutes trade dis)ri'ination Unfa7ed9 the Canadian govern'ent adopted an alternative )ooperative approa)h They )hose a watershed approa)hLto use 'a;or watersheds or drainage +asins as the geographi)al +asis for prote)ting Canada8s fresh water resour)es Prote)ting water resour)es within natural rather than politi)al +oundariesLregardless of whether a proposal ai's to divert water within Canada or outside itLena+les the govern'ent to skirt the argu'ent of dis)ri'ination that )an lead to international trade )hallenges The water issue will )ontinue to +e an i'portant fa)tor in Canada:US relations The un)ertainty of its statusLwhether it is C)ontinentalD and su+;e)t to sharing with another )ountry or CnationalD >to +e used only +y Canadians?Lwill grow now that al'ost every level of govern'ent in Canada has engaged in a pro)ess of trilateral integration with the Se)urity and Prosperity Partnership or SPP $mpact on local governments The federal govern'ent8s 'ove to adopt a )ooperative approa)h raises the @uestion of its a))eptan)e +y the provin)ial govern'ents whi)h are the pri'ary 'anagers of water resour)es !n order to provide a worka+le interpretation of )onstitutional and trade law in whi)h provin)es >and territories? would ena)t or a'end their laws or regulations to prohi+it +ulk water re'oval fro' watersheds within their ;urisdi)tion The federal govern'ent would ena)t a'end'ents to its International Boundary Waters Treaty Act for the sa'e purpose of prohi+iting +ulk water e,ports This strategy was announ)ed +y the Canadian govern'ent in &<<< (owever9 this strategy did not work as planned So'e provin)es )hose to use politi)al rather than watershed +oundaries in their laws and regulation So'e used +oth Iue+e) de)ided not to prohi+it inter+asin diversions for hydro pro;e)tsG Al+erta9 5anito+a and "ova S)otia a))o''odated e,)eptions to the prohi+ition against )rossing watershed +oundaries Another weakness of this )ooperative approa)h was the possi+ility of provin)es +reaking ranks at any ti'e to further their own trade interests Iue+e) and

10

"ewfoundland have indi)ated their interest in shipping water in +ulk when glo+al pri)es are suffi)iently high (en)e9 this raises the @uestion of whether or not the federal govern'ent )an overrule provin)ial govern'ents9 whi)h )hoose to a)t independently9 on 'atters of national interest and pu+li) will %. Legal !s water in its natural state now a trada+le good su+;e)t to li+erali7ed trade rulesB This is the )ru, of the pro+le' fa)ed +y +oth the Canadian and US govern'ents /arly drafts of the Canada:US 0ree Trade Agree'ent in &<8< did not in)lude water as a Ctrada+le goodD +ut the final version of the Agree'ent o'itted this provision /ven "A0TA )lassified water as a trada+le good !n &<<* it issued a state'ent that "A0TA )reates Cno rights to the water resour)eD of any trading partner (owever9 this state'ent was unsigned leaving 'any to )on)lude this has no legal for)e Another tou)hy issue is "A0TA8s Chapter && whi)h allows a foreign +usiness har'ed +y lo)al rules to sue for da'ages in spe)ial tri+unals that la)k the transparen)y of nor'al )ourt pro)eedings !n &<<8 a California )o'pany Sun+elt9 !n) filed a M&0 . +illion )lai' over the provin)e of British Colu'+ia over British Colu'+ia8s +an on +ulk water e,ports The )ase re'ains unresolved % SU55A#1 $0 A#6U5/"TS Economic Although there have +een no e,tensive trading in +ulk water 'ainly due to te)hni)al diffi)ulties9 this does not fore)lose the possi+ility of entrepreneurs engaging in +ulk water re'oval fro' +asins and )oastal rivers and strea's Profits go 'ainly to the entrepreneurs with no possi+le e)ono'i) gain to the pu+li) Ecolog" Bulk water re'oval fro' a +asin or a strea' will affe)t the e)ologi)al +alan)e of the area %e'and for water in the US will +e 'ost )riti)al during spring and su''er espe)ially for drought:prone areas in the west and southwest 3ikewise there are areas in northern Canada that e,perien)e shortages during su''er 3owering of water levels in rivers and strea's )an )ause siltation and the growth of undesira+le fungus and snails and other unwanted )reatures !t will also affe)t the seasonal sal'on run and the +reeding of fish in strea's and rivers !n a )riti)al situation9 the US govern'ent 'ight pressure the Canadian govern'ent to allow a))ess to fresh water sour)es whi)h will disrupt the e)ologi)al +alan)e Political The federal govern'ent has a loose hold on provin)ial govern'ents whi)h 'anage the water resour)es (istory has shown that the provin)es )ould easily pursue their own progra's with regards to water resour)es Any 'ove +y the federal govern'ent to allow +ulk water trading

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will +e resisted not only +y environ'entalists and far'ers +ut also +y the provin)ial govern'ent 3ikewise9 the federal govern'ent )annot )ontrol a provin)ial govern'ent on lo)al trade 'atters /,ternally9 the Canadian govern'ent is +ound to honour its )o''it'ent to the "A0TA and the World Trade $rgani7ation !n honouring these )o''it'ents9 the federal govern'ent runs the risk of )onfli)t with provin)ial govern'ents that )ontrol and 'anage the water resour)es in their ;urisdi)tion Legal Canadians histori)ally oppose any 'ove +y either the federal or provin)ial govern'ent to trade on natural resour)es whi)h a)tion is per)eived )ontrary to national interest They are opposed to the )on)ept of the A'eri)ans that Canadian water is )ontinental rather than national They are apprehensive of any 'ove to 'ake water resour)es )ontinental as this will allow A'eri)ans greater a))ess to Canadian water !t would 'ean loss of sovereignty on the side of the Canadians (owever9 +eing a party to the "A0TA and the World Trade $rgani7ation 'akes Canada su+;e)t to the organi7ations8 rulings parti)ularly on water as a trada+le good and that +anning its e,port would )onstitute trade dis)ri'ination / C$"C3US!$" Canada is a regional9 if not glo+al9 )iti7en whi)h has to learn to intera)t +enefi)ially with its neigh+ours The ti'e will )o'e when it will +e )alled upon to share its water resour)es in the 'anner that the US has worked out an arrange'ent with 5e,i)o a ;oint use of two of its rivers "ational interest will +e the deter'ining fa)tor in any 'ove towards +ulk water trading with the United States The resear)her )on)ludes that Canada9 as a 'e'+er of "A0TA and the World Trade $rgani7ation9 has to share its water resour)es with its neigh+our9 the United States al+eit on a li'ited +asis if it is so re@uired /sta+lishing the li'its will +e di)tated +y the followingA & The overall @uantity of renewa+le and non:renewa+le water in the +asin9 river or sour)e of the +ulk water to +e re'oved Safety levels have to +e esta+lished prior to )on)luding an agree'ent for trading on +ulk water 2 Pro;e)ted rate of de)line in water levels and depth of a@uifers as a result of glo+al war'ing * The potential risk of e)ologi)al +alan)e distur+an)e whi)h ne)essitates the need to stop sharing the water resour)e 0 #/C$55/"%/% C$U#S/ $0 ACT!$" $n the +asis of the a+ove argu'ents9 this study re)o''ends the )reation of a Bulk Water Authority to 'anage and regulate the use of and e,port of +ulk water This Authority will +e responsi+le for 'onitoring the sharing of water and institute and i'ple'ent poli)ies that will ensure that Canadian interest is upheld and environ'ental issues are resolved
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6 #/0/#/"C/S Boo&s %avid Boyd9 %avid Unnatural 3aw UBC Press9 200* Byers9 5i)hael !ntent for a "ation9 Nan)ouverA %ouglas O 5)!ntyre9 2002 Periodicals The Trilat(erald9 Nol * "o 2H*9 5ay 22H249 2002 The Trilat(erald9 Nol *9 "o 49 5ay 249 2002 'ewspaper (rticles =oseph9 S >20049 =anuary J?? The Broken Pro'ise of "A0TA "ew 1ork Ti'es %8Aliesio9 # >20029 =uly 2? Servi)e )aga*ine (rticles Sally A)harya9 S >20029 5ay 2<? 5odel "orth A'eri)an Parlia'ent %raws Students fro' Three "ations A'eri)an Weekly +ebsites PhttpAHHvera)ity univpu+s a'eri)an eduHweeklyHwe+newsH0.2<02triu'virate ht'lQ PhttpAHHwww pi energy govHdo)u'entsH"A/W6inde,020*0J pdfQ PhttpAHHwww glo+alpoli)y orgHglo+ali7He)onH2004H0&0Jstiglit7nafta ht'Q PhttpAHHwww finaafi orgHengHfinaHpresentation aspBlangueRengO'enuRfinahttQ PhttpAHH)'te parl g) )aH)'teHCo''itteePu+li)ation asp,B C$5R*222OSour)e!dR*2.<2OSwit)h 3anguageR&Q PhttpAHHwww )isan una' ',H"ortea'eri)a&Hht'Hrpastor. ht'lQ P>httpAHHwww )eo)oun)il )aHenHviewHBdo)u'entSidR*J.?Q ,ther sources Canadian Coun)il of Chief /,e)utives >200*9 =anuary? Se)urity and ProsperityA Toward A "ew Canada:United States Partnership !n "orth A'eri)a =anuary 200* Canadian Coun)il of Chief /,e)utives >20049 April? "ew 0rontiersA Building A 2&st Century Canada:United States Partnership !n "orth A'eri)a "orth A'eri)an )li'ate )hange pa)t urges CanWest "ews

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Canadian Coun)il of Chief /,e)utives >200.9 5ar)h 2*? Trilateral Se)urity and Prosperity Partnership Will Boost =o+s and !nvest'ent Standing Co''ittee on 0oreign Affairs and !nternational Trade >T0029 %e)e'+er? Partners in "orth A'eri)aA Advan)ing Canada8s #elations with the United States and 5e,i)oA #eport of the Standing Co''ittee on 0oreign Affairs and !nternational Trade9 %e)e'+er 2002A p &.8

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