WTO NEWS: SPEECHES DG PASCAL LAMY
Geneva, 10-11 October 2005
“Trade can be a friend, and not a foe, of conservation” — Lamy
WTO symposium on Trade and sustainable Development within the framework of paragraph 51 of the Doha Ministerial Declaration.
Ladies and gentlemen,
It is my pleasure to welcome you all to this Symposium on Trade and Sustainable Development. To begin, allow me to present my deepest sympathies for the victims of the recent earthquake in South Asia. Such natural disasters remind us of the importance, as well as the fragility, of the environment we live in.
Ladies and gentlemen, allow me to share with you the pride that I feel in having the WTO be the “initiator” of today's dialogue on sustainable development. I am proud that this Symposium is taking place under our roof.
I am doubly proud — as all Members should be — of the context in which it is happening. This Symposium is being held against the background of environmental negotiations, launched for the very first time in the history of the multilateral trading system. It is also being held in the context of the WTO's “development” agenda — otherwise known as the Doha Round. It is a Round of trade negotiations that has placed “development” at the very center of what the WTO does.
While the WTO has discussed [quote unquote] “environmental and developmental issues” in the Committees on Trade and Environment and Trade and Development for many years now, Paragraph 51 of the Doha Development Agenda has come to reshape our thinking. In Paragraph 51, Ministers instructed us to change our frame of mind. In other words, to no longer compartmentalize our work; discussing environmental and developmental issues in isolation of the rest of what we do. These are issues that permeate all areas of the WTO. In fact, it is through the lens of Paragraph 51 that we must now begin to look at the rest of the WTO. We must remember that sustainable development is itself the end-goal of this institution. It is enshrined in page 1, paragraph 1, of the Agreement that establishes the WTO.
But — you may well ask — if Sustainable Development is so central to the WTO, what then is the WTO doing to make it happen? Trade is an engine of economic growth. And, if you believe in markets, like I do, you also believe that trade has the capacity to deliver the most the efficient allocation of resources, and hence economic growth. However, if you believe in markets, you also believe that they are in need of being [quote unquote] “corrected” every once in a while. In other words, the “invisible hand” itself needs to be “taken by the hand” sometimes.
Let give you some examples. In a world without artificial economic borders, goods can come and go. Trade can take place freely. In that world, a country with an arid climate need not use its scarce water resources to grow water intensive crops that it can instead import. Because of trade, it can save its precious little water. Similarly, in that world, a country with limited access to the sea need not deplete its fish stock to feed its population. Because of trade, it can import fish for its food supply, and manage its own fisheries sustainably. Trade can allow for a more efficient allocation of all resources, including the natural. Contrary to the perception of some members of the public, it can be a friend, and not a foe, of conservation.
But as we all know, the capacity of markets to deliver efficient outcomes is linked to what we place within the market. If the social or environmental costs of some our activities fall outside, then an efficient allocation of resources will not take place. In the examples I just gave, if a ship that is on its way to deliver a product from Country X to Country Y, dumps its waste into the sea on its way, than the costs of trade may well outweigh its benefits.
So what does all this mean for the WTO? It means that while the WTO has the capacity to open borders — and to thereby switch on an important engine of economic growth — for the benefits of that growth to show, Members will need “accompanying policies.” On the social side, these will be needed to ensure that a fair and equitable distribution of the benefits of trade takes place. On the environmental side, they will be needed to ensure that trade — which has the capacity to help the environment — does not end up going the other way.
I hasten to add that these “accompanying policies” can no longer be looked at by the WTO as the responsibility of other organizations. The WTO is responsible for them too. But it will need to rely on the expertise of partner institutions, and to reflect the debates that are ongoing within its Member states. Hence the importance of continued dialogue with UNEP and other organizations. Also important are tools — such as Sustainability Impact Assessments — which can help Members, at the national level, identify the “accompanying policies” that they need. All of this shows the importance of the topic that is under discussion today.
We must also remember that we live in a world where millions continue to live on less than $1 dollar a day. This has direct implications for sustainable development. As the Brundtland Report had put it, what many countries face is the “pollution of poverty.” Poverty forces people to overexploit their natural environment, and such overexploitation, in turn, hurts their chances of development. For, as we all know, a healthy natural resource base is itself a vital ingredient for economic growth. Trade, and the WTO, can help by bringing that growth about.
Contained in the Doha Round is a long list of sustainable development questions, to which all Members will have to respond. As the WTO switches on an important engine of economic growth, it must ensure that its rules do not frustrate the implementation of multilateral environmental protection accords. These accords are a fundamental pillar of the [quote unquote] “accompanying policies” of which I just spoke. The WTO must support these policies, and strengthen the consensus on which they are based. But it must also ensure that its own rules help to correct environmental problems, as with the disciplining of harmful fisheries subsidies or environmentally harmful agricultural support.
But there is an even more obvious role that the WTO can play for environmental protection — one which falls squarely within its mandate. It is that of liberalizing trade in the goods and services that can help protect the environment. Hence the “environmental goods and services” negotiations that are underway as part of the Doha Development Agenda. While it is logical for countries to tax the goods and services that pollute the environment, it is not logical for them to erect barriers vis-à-vis those that help protect our air, water and soil. Such a tax would in fact amount to a penalty on a population's health and wellbeing. I strongly hope, therefore, that Members will maintain a high level of ambition in these negotiations.
There are many other questions that the Doha Round will have to grapple with; issues that are also reflected in the program of this Symposium. For instance, the relationship between the TRIPS Agreement and the Convention on Biological Diversity; or the TRIPS Agreement and the need for technology transfer. While important, these issues of course do not by any means exhaust the sustainable development dimension of the Doha Round. There are many other issues like TRIPS and health, cotton, and so on, that we will need to addressed to make this truly a development round.
Ladies and gentlemen, you have before you a very interesting day and a half. In that day and half, you will be covering issues that range from agriculture to technology transfer. Many different speakers, renowned in their fields, have agreed to take part in this Symposium. I am grateful to them, and welcome them wholeheartedly to the WTO. With these words, allow me to declare this meeting open and to wish you every success in your deliberations.
As I had stated in my preface to the book which has recently been published by the United Nations University, the pursuit of sustainable development is a difficult balancing act, requiring progress on all three of its pillars — the economic, the environmental and the social. Through this Symposium, it is vital that you give meaning to Paragraph 51 of the Doha Development Agenda, and the notion of sustainable development that it contains — after all, such mandate may not come again!