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Symposium on issues confronting the world trading system
summary reports by the moderators

6 and 7 July, World Trade Organization, Geneva, Switzerland  

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Friday, 6 July

Session III: Trade and Environment

Moderator: David Runnalls — President, International Institute for Sustainable Development

The WTO has been organizing occasional symposia on trade and environment for almost seven years and during that time, the agenda has remained consistently the same. The Chair reflected on why this is so.

First, there is still a debate over whether environment belongs on the WTO agenda at all while other international organizations, such as UNEP and the MEAs, exist to resolve environmental issues. But environment is already embedded in the WTO through the sustainable development clause in the preamble, the provisions of the TBT agreement, Article XX of the GATT and in a number of other places. It has figured prominently in many reports of the dispute resolution panels. Finally, sustainable development is a response to the integration of environment and economics which we see in the form of climate change, ozone depletion and the loss of biological diversity.

Second, there is a continuing fear on the part of many developing countries that a new form of protectionism is emerging - that of green protectionism.

Third, it was pointed out that international discussions of sustainable development have been characterized by the existence of two parallel agendas. The "northern agenda" of climate change, biodiversity and deforestation and the "southern" agenda of market access, debt relief, technology transfer and increased official development assistance existed side by side as long ago as the Earth Summit in 1992 and efforts to bridge the gaps through the so called "Rio bargain" have been a failure.

Finally, many in civil society are suspicious of the motives of Trade Ministries and the WTO. They often characterize the latter as opaque, too open to influence by economic interests and uncomfortable with environmental issues.

With this as an introduction, the group proceeded to the issues raised by the panelists.

On Multilateral Environmental Agreements (MEAs) and WTO Rules:

  • Trade is only one of the tools that can be used to address environmental concerns

  • MEAs are a comprehensive package that must include financial/technology transfer and capacity building. Many developing countries are finding it impossible to meet the obligations imposed by the increasing numbers of international environmental agreements

  • It is important to reflect on the distinction between unilateral vs. multilateral approaches to addressing environmental concerns. Unilateralism is a major concern of developing countries

  • The legitimacy of trade sanctions as a tool to enforce MEAs needs discussion

  • Fines for non-compliance or non-adherence to MEAs could be an alternative to trade sanctions

  • Some questioned whether the US would "free-ride" on the Kyoto Protocol and the Convention on Biological Diversity, and whether difficult disputes on the failure to internalize environmental externalities (particularly in the Climate Change context) could come to WTO

  • Forum shopping is a problem in the trade and environment area, and discussion is needed on where to bring disputes – to the WTO, or to MEAs

  • Process and production methods (PPMs) are at the heart of the trade and environment debate, and it is important to reflect on them

  • The principle of "common but differentiated responsibility" as well as special and differential treatment in the context of WTO rules are important

  • MEAs are more successful, and less subject to potential challenge in WTO, when their membership is broad

  • There is a need for good environmental governance, and some questioned whether enough is being done in MEAs

  • The establishment of an intergovernmental panel on the WTO-MEA relationship was proposed

  • Some stated that there is a need for political commitment to resolving the MEA issue in Doha

On Process and Production Methods (PPMs)/Genetically Modified Organisms (GMOs)/Labelling:

  • There are many different perspectives from which PPMs can be examined: the legal/policy perspective and the economic/trade perspective

  • Non-product related (NPR) PPMs are of greater concern to the trading system than those that are product-related

  • There is no clear answer in the WTO on NPR-PPMs

  • There is tension between the use of life-cycle analysis (LCA) in ecolabelling schemes and the rules of Agreement on Technical Barriers to Trade (TBT)

  • Internationally agreed PPM-based standards could be a potential solution to the PPM debate. WTO Agreements themselves promote the use of international standards

  • There are important questions before WTO Members which the members themselves should resolve rather than leave to the WTO's dispute settlement mechanism. The "judge" should not be assigned a policy-making role

  • Countries must decide on the fora in which to address these issues. Today numerous instruments address GMO labelling: the WTO Agreement, the standards of the Codex Alimentarius Commission, and the Biosafety Protocol.

  • The concept of "mutual supportiveness and deference" can play an important role in trade and environment discussions, allowing each international organization to focus on what it is competent on, without trying to assume the role of the other

  • The role of scientific uncertainty in decision-making needs discussion, and our decision-making structures need to reconsidered. The IPCC was mentioned as perhaps the most successful solution to this dilemma

  • The precautionary principle could play a role in risk management, but it is important to define what is meant by precaution and how it can apply in a trade context. The need to consider the opportunity cost of chasing after uncertain risks is also important to take into account

On Market Access; Agriculture and Fisheries:

  • There is a need to change governmental priorities. The problem of overfishing cannot be addressed without political will

  • It was pointed out that this political will existed prior to Seattle and had the Ministerial come to successful conclusion, the progressive reduction of most fisheries subsidies could have been part of the outcome

  • The removal of fisheries subsidies is a good example of a "win-win-win" situation for developed and developing countries

  • Fisheries subsidies already fall within the mandate of the WTO. Notifications are an important instrument to use to keep track of subsidies and very few countries actually notify their fisheries subsidies

  • More WTO disciplines could be needed to address the sustainability aspects of fisheries subsidies

  • Some pointed out that subsidies can be good for the environment, and tariffs and subsidies could be needed to ensure the viability of the fisheries sector

  • Some stated that the FAO is the appropriate forum for discussing fisheries subsidies and that it is too early for the WTO to get involved in this area


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