Subject: WTO and MEAs
The Nation
Saturday, December 7, 1996

WTO could undermine environmental treaties

by James Fahn

   All eyes will be on the World Trade Organisation (WTO) when it holds
   its first ministerial meeting next week in Singapore, for the
   newly-created agency will essentially lay down the ground rules for
   the global marketplace.

   Many issues are being raised, but among the most contentious will be
   the efforts to link global trade rules with labour and environmental
   standards. Senior officials have failed to agree on a draft
   declaration for the summit, which will have to instead be hammered
   out by the ministers when they gather in Singapore.

   The crux of the dispute is by now well known. Governments of
   developing countries (the South) - led by India, Indonesia and
   Malaysia - are opposed to ''confusing" an already complex trade
   agenda with ''new issues", including labour and the environment, suspecting
   they are merely an excuse to establish new protectionist measures.

   The governments of developed countries (the North) have been pushing
   these issues as a result of pressure from their own citizenry, who
   have watched in concern as industries flee to countries with cheaper
   labour and looser regulatory climates. But the North also has its own
   business agenda - the US, for instance, wants to discuss labour
   standards, but it also wants to reach an agreement on freeing up
   trade in information technology - and the bargaining in Singapore will be
   fierce.

   Social issues

   As the WTO approaches, the social issues seem to be drawing the most
   attention, with Indonesia stating explicitly last week that it would
   reject any declaration that includes issues such as human rights and
   labour standards. On the other hand, this could mean that some kind
   of an environmental agreement is possible.

   Peter Ungphakorn, a well-known Thai trade journalist who now works
   full-time for the WTO in Geneva, points to three main issues in the
   dispute: the expansion of trade causes an increase in environmental
   impacts; the relationship between the WTO and other international
   treaties; and what environmental regulations, if any, should be
   imposed on world trade.

   As a result of northern pressure, a Committee on Trade and
   Environment (CTE) was established to look at these and other related issues.
   Unfortunately, its report (  which can be found on the World Wide Web
   at http://www.wto.org/wto/Trade+Env/tocte.html  ) has amounted to little
   except a laundry list of the views of each side.

   ''I found the CTE report to be disappointing but not surprising,"
   said one American environmentalist, who outlined a number of issues which
   should come up at least on the margins of the meeting: the process of
   globalisation (there may even be some protests on this issue);
   eco-labelling; sustainable timber trade; trade in genetically
   modified organisms; animal welfare issues; who will be allowed to represent
   the greens at the WTO; and the transparency of the WTO's activities.

   Another controversial issue will be whether trade measures can refer
   to production and process methods (PPMs). The US has passed laws
   barring imports of seafood harvested through methods damaging to
   dolphins and sea turtles. The Gatt, WTO's predecessor, ruled the
   dolphin-safe tuna law illegal - twice. Now the turtle-inspired
   sanctions on shrimping are up for review, following a complaint filed
   by Thailand, Malaysia, Pakistan and India.

   But perhaps the most important green task in Singapore is to decide
   how the WTO's trade rules fit in with those enacted by multilateral
   environmental agreements (MEAs). Governments voluntarily enter into
   treaties - such as the UN conventions on climate change and
   biodiversity, or the Montreal Protocol on the use of ozone-destroying
   substances - but there is as yet no agreement on what would happen in
   a case where their provisions conflict with the statutes of the WTO.
   Some environmental treaties use trade sanctions as penalties. Others
   have actually been set up to regulate trade in certain goods: CITES,
   for instance is a convention on trade in endangered species, and the
   Basel Convention controls the international movement of hazardous
   substances.

   ''We haven't had a direct clash with other international agreements
   concerning the environment, but I'm sure it will come," says
   Hans-Peter Werner, an information officer at the WTO's secretariat in
   Geneva. For instance, trade sanctions could be imposed on a country
   which fails to live up to its treaty commitments. But as it stands,
   that country could then file a complaint against the trade sanctions
   with the WTO, which could then order the sanctions to be dropped.

   It appears to be countries from the Association of Southeast Asian
   Nations (Asean) who are leading the fight to block recognition of the
   jurisdiction of these treaties. Asean recently proposed that, should
   such a conflict arise, the WTO could hand out ''waivers" on a
   case-by-case basis.

   Environmental rules

   Asean's position is all the more surprising because its
   representatives have regularly stated that labour and environmental
   issues should not be handled by the WTO, which does not have the
   necessary expertise. And yet Asean does not seem willing to accept
   the environmental rules its own governments have agreed to.

   This dispute seems to be turning into a battle over who will set the
   rules that guide the way nations interact. The WTO, which largely
   represents the interests of business, does not seem willing to accept
   the legality of other international treaties, many of them enacted
   under the auspices of the United Nations. It is as if a country's
   Commerce Ministry decided to pick and choose which environmental laws
   it would follow.

   If the WTO hopes to get along peaceably with the rest of the world,
   it should make recognising the jurisdiction of MEAs a top priority.
   There should be opportunities for other agreements, too.

   Both environmentalists and free traders, for instance, firmly oppose
   subsidies for using natural resources, which are widespread around
   the world.

   What is most needed is a return to the spirit of Rio de Janeiro,
   where in 1992 world leaders gathered for the Earth Summit and pledged to
   help each other merge environmental concerns with development. Sadly,
   all that now seems to be ancient history.

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