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 
 
-------------------------------------- 
NEW LAW: RIACHUELO RIVER BASIN CLEANUP 
-------------------------------------- 
 
¶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. 
 
--------------------------- 
NEW LAW: BIOFUELS PROMOTION 
--------------------------- 
 
¶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. 
 
------------------------------- 
 
BILL: PROTECTING NATIVE FORESTS 
------------------------------- 
 
¶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. 
 
------------------------------------ 
BILL: NONRENEWABLE NATURAL RESOURCES 
------------------------------------ 
 
¶11. (U) Chairman Bonasso has also introduced a bill to 
establish minimum environmental protection standards for the 
&rational 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