The reform of Peru's Environmental Code will include economic incentives for compliance with environmental regulations, lawmaker Fabiola Morales told Tierramérica. Morales is a member of the commission that is drafting a bill on the issue. Represented on the commission are 18 public, non-governmental and business institutions.

''The likely signing of a free trade treaty with the United States is pushing us to strengthen legal instruments in defense of the environment,'' said Morales.

The existing environmental code, dating to 1991, obligates mining, logging, industrial and tourism companies to present plans for mitigating environmental impacts, otherwise they could face sanctions, including prison time.

''After 14 years of applying that law, we have found that except in the mining sector it has not achieved its goals. The threat of sanctions was not enough, leading us to try the carrot-stick approach,'' said lawmaker Victor Espinoza.