Date: 1992-10-02
Speaker: DR LA GARZA (democrat)
Chamber: H

Mr. Speaker. H.R. 4059. the Good Neighbor Environmental Act of 1992. establishes a workable and costeffective way to help some of the countries of Latin America and the Caribbean finance environmental projects. H.R. 4059 achieves this objective through an innovative approach that will help reduce our official debt exposure. It is an approach that promotes the improvement of environmental conditions In Latin America and the Caribbean. This bill thus creates a winwin situation for the U.S. taxpayer and for the cause of environmental quality. Under H.R. 4059. the U.S. Treasury is authorized to accept payment immediately on a debt thatunder Paris Club rescheduling termswould not have to be paid back. in most cases. for another 5. 10. or 15 years. The approach taken in this bill is what I would term a governmenttogovernment. debtforenvironment swap. H.R. 4059 authorizes the President to sell at the market price up to 40 percent of the socalled Paris Club rescheduled debt owed by nine Latin American and Caribbean countries to the U.S. Department of Agricultures Commodity Credit Corporation [CCC]. Among the countries that could use this mechanism are Mexico. Brazil. Chile. and Jamaica. Up to approximately $500 million of the $1.4 billion owed to the CCC under the Paris Club agreement could be repurchased under the bills provisions. However. a market rate sale can only take place if the debtor country agrees to commit an amount equivalent to 40 percent of the purchase price in local currency to finance eligible environmental projects in that country. I would like to point out that this legislation can directly benefit the millions of Americans who live near the United StatesMexico border. H.R. 4059 allows the proceeds derived from Mexicos participation in this mechanism to be used to finance environmental projects along the United StatesMexico border and in the Gulf of Mexico. Thus. Mexican participation in this mechanism will benefit people on both sides of the border. Mr. Speaker. the projects that could be undertaken through the financing made available under this legislation include both nature and development projects. An eligible project could be a local initiative to protect the environment or a project to improve human living conditions threatened by environmental degradation. H.R. 4059 has another provision I would like to highlight. The legislation authorizes a comprehensive study on the potential effects of a free trade zone with Latin America and the Caribbean. as envisioned under the Enterprise for the Americas Initiative. This provision recognizes the need for Congress to have a comprehensive analysis done on the economic. labor. and environmental effects a hemispheric free trade zone may create. Mr. Speaker. this legislation is a logical extension of the only part of the Enterprise for the Americas Initiative that has been authorized by the Congressthat is. the EAI provision to reduce Public Law 480 debt included in the 1990 Farm Act. and that was funded in the agricultural appropriations bill signed into law a month ago. Mr. Speaker. I would like to thank the chairman. the gentleman from Florida 4. the ranking minority member. the gentleman from Michigan . the gentleman from New Jersey . the gentlemen from New Jersey . the gentleman from California . and all my colleagues on the Committee on Foreign Affairs. which received a sequential referral of the legislation. for their contributions and suggestions for finetuning this excellent bill. The administration has expressed its support for passage of H.R. 4059. Mr. Speaker. the United States. Mexico. and other Latin American countries have committed themselves to tackling the environmental problems they face within their border. Lets seize this opportunity to build upon the commitment in Mexico and other parts of Latin America and the Caribbean. I urge passage of the bill. Mr. Speaker. I reserve the balance of my time.