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LEAVITT SEES MUCH GOOD IN NAFTA; WASTE DISPOSAL MAY BE DRAWBACK

SHARE LEAVITT SEES MUCH GOOD IN NAFTA; WASTE DISPOSAL MAY BE DRAWBACK

Utah's economy has been booming for several years, with thousands of jobs created, a hot real estate market and more than $300 million in new revenue growth even after a sales tax decrease. Now comes NAFTA, and things just look better.

The North American Free Trade Agreement won't hurt Western states, various businessmen and officials told Western governors Monday. It will only help."NAFTA means 80 million new potential customers for us," said Gov. Mike Leavitt. The meeting of the Western Governors Association reinforces what Leavitt learned from a recent trip to Japan and South Korea - many countries are looking at the western United States, as buyers, sellers and transport points.

In Japan, said Leavitt, "We had a one-hour meeting with the group of Japan's largest companies (akin to America's Fortune 500). And what they really wanted to talk about was how NAFTA places Utah right in the middle of the trade routes, geographically and especially technologically."

Leavitt sees mostly good from NAFTA.

But there is a warning. In an agreement separate from NAFTA, there are regulations for repatriation of hazardous waste that comes from the assembly products shipped from the United States to Mexico, put together (with hazardous wastes produced in the process) and then shipped back. While that amount of waste is relatively small - 4,000 barrels a day - it can still be a concern.

A key to NAFTA is its environmental rules; that's because a number of U.S. and Canadian firms have opened Mexican production facilities. Mexico's environmental laws are lax, or not effectively enforced, and so production can be cheaper south of the border.

Leavitt worries that too much repatriated hazardous waste could increase pressure to place hazardous waste in Utah.

The state has several hazardous waste disposal facilities now, and a big part of their business is out-of-state waste. Certainly, Leavitt wants those Utah industries to remain healthy. But how much out-of-state waste - and now perhaps out-of-U.S. waste - Leavitt and Utahns want brought in is another matter.

But the amount of repatriated waste is low, said Raul Deju, president of Chemical Waste Management West, and it may turn into an asset to Utah business as opposed to a liability.

For now, Leavitt sees NAFTA in a positive light. "I see it helping our software industry, a big gain. Some environmental technologies, communications and, of course, tourism," Leavitt said.

Former U.S. transportation secretary and former Oregon Gov. Neil Goldschmidt echoed Leavitt's optimism.

Many believe the border states like California, Arizona and Texas will benefit from the Mexican connection. But Goldschmidt said that hasn't been the case recently and won't be in the future. It is non-border states, like Utah, that will see the biggest impact of NAFTA.

For example, in just 18 months Washington state has doubled its export of apples to Mexico, from 2 million boxes to 4 million boxes, Goldschmidt said.

Part of NAFTA is environmental mitigation. Environmental standards won't be lowered in the U.S. but will be raised in other countries. Accordingly, over the next 10 years between $6 billion and $10 billion will be made available as loans to get border industries up to par.