Topics handled by WTO committees and agreements
Issues covered by the WTO’s committees and agreements

ENVIRONMENT: ISSUES

Environmental reviews

The Trade and Environment Committee has been discussing environmental reviews in general since 1996, and more intensely since 2001.

Topics handled by WTO committees and agreements


Some WTO members consider environmental reviews to be useful tools for trade agreements. The purpose is to improve the ability of environmental and trade policies to work together, and to identify actions that will enhance positive environmental impacts and avoid negative ones.

In the WTO, the Committee on Trade and Environment started its work on environmental reviews in 1996 under Item 2 “Environmental protection and the trading system” of its work programme.

In 2001, the importance of environmental reviews in WTO trade negotiations was confirmed in paragraph 6 of the Doha Declaration. This reads: “We take note of the efforts by Members to conduct national environmental assessments of trade policies on a voluntary basis.”

In Paragraph 33 of the Doha Ministerial Declaration Ministers “encourage that expertise and experience be shared with Members wishing to perform environmental reviews at the national level”. The continued work in the committee is based on this.

The importance of reviews was also confirmed in the Johannesburg World Summit on Sustainable Development’s Plan of Implementation of 2002.

  
Diverse approaches

Members agree that policies to promote trade and the environment should support each other. They agree that exchanging information on the methodology and implementation of national environmental reviews is useful. They believe that technical assistance in this area is needed.

At the same time, they recognize that countries have different approaches to environmental reviews, that conducting the reviews is difficult and that the methods are still evolving.

Some stress that no member has the perfect tool for these reviews and that any tool needs to be adapted to each particular situation.

Some developing country members have stressed that there should be no obligation on national authorities to conduct environmental reviews — the reviews should be voluntary. They say the reviews should also be consistent with a country’s priorities and that the developing countries’ task should not be made more onerous by requiring countries to use the same or similar procedures (the procedures should not be “harmonized”). That would mean that the reviews must be carried out in the light of the requirements of each country, its capability and resources, its level of development, its expertise and the local situation.

One view is that environmental reviews should be a means to identify the difficulties that developing countries face so as to overcome these difficulties and promote sustainable development: the aim has to be to bring environmental, economical and social benefits to all countries.

What if a review shows that trade liberalization could cause some damage to the environment? One view is that the country should examine how to avoid that by finding policies that would make the trade and environmental aspects work together without causing harm to each other.

Another view is that environmental reviews should not be binding on decision-makers. Rather, it should be a tool offering self-assessment as a means to make policies more coherent. Governments would also be able to act outside the trade agreement in order to mitigate the environmental impact. In some cases reassessment might be needed to work out longer term policies — these would take into account the economic valuation of the environmental degradation and the expected economic benefits of trade liberalization.

 

Information before the CTE

A WTO Secretariat note produced in 2000, “Environmental (Sustainability) Assessments of Trade Liberalization Agreements at the National Level”, noted that the purpose of assessing before an agreement takes effect is to reinforce potential positive environmental effects or prevent potential negative ones. Assessing afterwards can be used to consider whether there might be a need for additional adjustments to policy to mitigate the environmental impact. The paper also considers:

  • Why a country chooses to undertake an assessment
  • What is assessed
  • How to establish the link between the effects of trade liberalization and environmental impacts

In 2002, the Secretariat circulated another note, this time on the effects on the environment of liberalizing services trade — “Discussing Paper on the Environmental Effects of Services Trade Liberalization”).

This paper has been discussed under Items 6 (“environment and trade liberalization”) and 9 (“services”) of the Trade and Environment Committee’s agenda. It looks at three selected areas (tourism, land freight transport and environmental services) and briefly considers how to assess the environmental effects of liberalizing services trade.

The paper highlights the importance of finding methods that will help policy-makers to focus on the most significant environmental effects and to find ways of dealing with them — particularly policy-makers with limited resources.

  
Sharing experience

The Doha Declaration (Paragraph 33) asked members to share their experiences with each other. Several have described the environmental reviews, environmental assessments or sustainability impact assessments of the WTO negotiations and other major trade agreements.

For instance, among WTO members, the European Union carries out sustainability impact assessments (SIAs) on trade negotiations; Canada has done environmental assessments (EAs) of the WTO negotiation; and the US has conducted an environmental review (ER) of the Doha Development Agenda negotiations.

Organizations that are observers in the Trade and Environment Committee have also contributed. The United Nations Environment Programme (UNEP) informed the CTE of its methods for environmental assessment of trade liberalization, and the projects it has set up in countries to assess the environmental effects of trade policies.

Most studies show how important it is for environment, trade, finance, and other government officials to increase their coordination within the country.

In 2003, the Committee reported on its work on sharing experiences to the Cancún Ministerial Conference.

Since then, members have continued to inform the committee of their environmental reviews and related activities carried out at the national level.

These include seminars and conferences they have held to share expertise and experience. Some examples:

  • an EU seminar in 2003 on “Sustainability Impact Assessment of Trade Agreements: Making Trade Sustainable?”

  • a Canadian conference of the International Association of Impact Assessment in 2004

  • an EU Conference on Impact Assessments in 2006.

In May 2007, with at view to facilitating the experience sharing exercise, a note was prepared by the Secretariat which lists the trade related environmental reviews which have been, or, are being carried out (WT/CTE/W/245). The document, following a brief description of the Committee's discussions on environmental reviews in the context of Item 2 of its work programme and subsequently of Paragraph 33 of the Doha Ministerial Declaration, provides an illustrative list of the various trade related impact assessments. These projects have been grouped under the heading of multilateral trade liberalization initiatives, regional and bilateral trade liberalization initiatives, and national projects. In October 2008, this list was updated (WT/CTE/W/245/Add.1).

More on shared experience of impact assessments