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FROM VOLUME 12, NUMBER 3, MARCH 1999

SPECIAL REPORT ON INTERNATIONAL CONVENTIONS...
WTO Symposium on Trade and Environment

Item #d99mar46

Through debate, negotiation, and adjudication, the World Trade Organization (WTO) establishes the contractual obligations that regulate how governments develop legislation and regulations pertaining to trade. Its objectives are to lower barriers between peoples and nations, avoid discrimination, and create a global trading system that is rule-based not power-based. Recognizing the environmental impacts of development and commerce, it established a Committee on Trade and Environment (CTE) "to identify the relationship between trade measures and environmental measures in order to promote sustainable development." That Committee held a high-level symposium on trade and environment in Geneva on March 15-16, 1999, to consider

• linkages between trade and environment policies;
• synergies between trade liberalization, environmental protection, sustained economic growth, and sustainable development; and
• interaction between trade and environment communities.

The Symposium was organized into three panels along these topics. Attendance included more than 150 representatives from environment and development NGOs, corporations, research and academic institutions, and governments.

The meeting was presided over by Renato Ruggiero, Director-General of the World Trade Organization. A message President Clinton's announced that the United States would recommend the reduction of environmentally damaging subsidies and would pledge to conduct an environmental review of the next round of negotiations. Sir Leon Brittan, Vice-President of the European Commission, said that the key to successful policy on trade and environment would lie in a coordinated approach to sustainable development. He stressed the need to adopt a clear and workable approach to eco-labeling and suggested that all WTO members integrate their trade and environment policies. Klaus Töpfer, Executive Director of UNEP, said that trade and environmental policy cannot be isolated from consideration of international debt, alleviating poverty, the transfer of technology, and enhancing developing countries’ capacity to attain sustainable development. He laid out four steps to be taken to address these issues:

• to identify the environmental strengths and weaknesses of trade rules,
• to exploit the environmental benefits of economic liberalization (e.g., full cost internalization and the removal of price-distorting subsidies),
• to articulate fundamental principles of international environmental policy to guide multilateral trading, and
• to make the multilateral trading system accommodate fundamental environmental principles and further sustainable development.

Ian Johnson, Vice President of the World Bank, said the challenge is to use the trade flows that had lifted millions out of poverty while protecting the environment. And Maritta Koch-Weser, Director-General of the World Conservation Union, raised several issues to be addressed: capacity building; intellectual property rights; the sharing of benefits from genetic resources, and biosecurity; elevating the CTE to a standing committee; the role of civil society; and evaluating existing rules of trade.

In the panel on linkages between trade and environment policies, Michael Zammit Cutajar, Executive Secretary of the United Nations Framework Convention on Climate Change, noted that trade policies emphasized liberalization and freedom and environment policies emphasized conservation and protection. Luis de la Calle said that, rather than being subject to trade sanctions, developing countries should be given access to environmental technology, technical support, and funding for environmental protection. Other participants noted:

• The current system does not ensure equitable distribution of wealth; rather, it leads to great disparities in consumption and income.
• Governments must ensure that growth remains within the limits of the ecological boundaries of the planet.
• Environmental policies are as legitimate as any other policies.
• The best solution to conflicts would be resolution within international agreements.
• Little progress has been made in aiding developing countries to liberalize effectively.

Participants also commented on the need to curb protectionism, the use of unilateral measures, and the relationship of multilateral environment agreements (MEAs) to WTO rules.

The panel on synergies among trade liberalization, environmental protection, sustained economic growth, and sustainable development focused how the removal of trade distortions could have a positive impact on environment protection, economic growth, and development (i.e., a "win-win-win" solution). Comments included:

• Liberalization should be pursued only where it contributes to sustainable development.
• The trading system should be reoriented to promote safe products and to discourage trade in harmful products.
• The trading system should be sensitive to environmental concerns at the same time that environmental regimes understand the need for economic growth.
• The rules of the trading system must not be slanted toward the promotion of trade interests at the expense of other values.

In the panel on interaction between the trade and environment communities, comments were made that:

• Three relationships needed to be enhanced: between civil society and the WTO, between environmental and other international organizations, and between trade and environmental policymakers.
• The ability of trade liberalization to produce real gains in sustainable development needs to be demonstrated through a focus on sustainable development (particularly in the South), the creation of a standing conference on trade and environment, and the negotiation of a WTO Agreement on the Environment that emphasized transparency and participation.
• WTO members should consult at the national and international levels before negotiations take place.
• WTO should pursue formal cooperation agreements with other international bodies, not just other economic bodies.
• "Harmonization of environmental standards" would not address the environmental conditions and requirements that differ from territory to territory; uniform standards could result in inappropriate allocation of limited resources.
• The reduction of greenhouse-gas emissions called for by the Kyoto Protocol could require an increase in the energy efficiency of some equipment and processes, which could produce trade and environment frictions.

Recurrent themes touched upon at the Symposium included the importance of building capacity in the South; the need for transparency in WTO activities; the need to engage civil society in the debate to increase public support for the WTO; the need to address trade, environment, and sustainable development in a comprehensive way that improves market access, technology transfer, and debt relief; the need for environmental review of economic-development projects; the use of MEAs to address transboundary issues; and the need to address environmental problems by other, better means than trade restrictions.

A full report on this meeting can be found at http://www.iisd.ca/linkages/sd/wtohls.html.