Insights from the Environmental Goods and Services Debate

Erwin RoseEconomic Affairs Officer

United Nations Conference on Trade and Development (UNCTAD)

5 May 2008. Geneva, Switzerland

"Environmental Goods and Services" (EGS)

Can we target trade liberalization to protect the environment?

• Outline– Recent developments in the EGS negotiations;– Key conceptual issues.

Background

• Doha Ministerial Declaration 31 (iii):

• "the reduction or, as appropriate, elimination of tariff and non-tariff barriers to environmental goods and services."

Recent Developments (1)

• November 2007 - Submission by Brazil– Biofuels– "request and offer"– Non-Tariff Barriers– Organic agriculture– Transfer of Technology

Recent Developments (2)

• October 2007 - World Bank: "Warming up to Trade? Harnessing International trade to support climate change objectives"– Illustrative list of 43 "climate-friendly technologies"

World Bank, recommendations include:• "Removal of tariff and nontariff barriers can increase the

diffusion of clean technologies in developing countries."• "Clean technology trade would greatly benefit from a

systematic alignment of harmonization standards."• "The ongoing WTO negotiations on environmental goods have

the potential to contribute significantly to both trade and climate change liberalization efforts, but the negotiations will need to address a number of challenges."

Recent Developments (3)

• December 2007 – EC & US ProposalJOB(07)/193Tier One: Goods: Eliminate tariffs and

identified NTBs linked to climate change with S&D.Services: Commitments in GATS related to climate change.

Tier Two: A broader plurilateral EGS Agmt.

CONCLUSIONS: Considering the impacts of tradeThe CTE experience is helping governments and stakeholders consider the environment and development impacts of trade more precisely.

The negotiating challenge

• No criteria or definition of EGS

• Still debating the negotiating modalities

• Potential environmental benefits alongside other interests

Mainstreaming EGS

• Can environmental concerns be integrated throughout trade policy?

• Does the political will exist to emphasize environmental objectives?

• How far can environmental criteria be incorporated into the WTO?

Trends

• Governments demonstrating flexibility.• Most products are inherently multi-use and

have diverse impacts.• Request-offer may gain traction.• Need more specific proposals on

agriculture, capacity building, NTBs, and technology transfer.

• CTE in parallel with other committees.

Realistic Expectations

• One element within the broader policy toolkit

• Local demand – “environmental markets”

• Production/export capacity

• Domestic economic and environmental policies determine the local impacts.

Trade & Environment:Defense to Offense

• No longer just seeking to avoid conflicts– (trade disciplines vs. environmental regulation-

avoiding green protectionism while maintaining domestic & intl. envtl measures),

– Governments and stakeholders considering the environment and development impacts of trade more carefully.

• Pro-active approach to integrate environmental and trade policies.

Erwin Rose

Economic Affairs OfficerTrade and Sustainable Development Section

Trade, Environment, Climate Change and Sustainable Development BranchDivision on International Trade in Goods and Services, and Commodities

United Nations Conference on Trade and Development

Tel.: +41.22.917.4573Erwin.Rose@unctad.org

trade.environment@unctad.org

www.unctad.org/trade_env/topicEGS.asp