UNCTAD

Environmental goods and services

Mandate

• “The reduction or, as appropriate, elimination of tariff and non-tariff barriers to environmental goods and services”, Doha Ministerial Declaration, para 31(iii)

• Does not define environmental goods– except in juxtaposition with environmental

services

• Does not define negotiating modalities

Institutional arrangements

• CTESS: product coverage

• NAMA: modalities

• CTS: environmental services

• AG?

• Rules?

Role for CTESS

• Define environmental goods?– foreshadow modalities?

• Identify issues relevant to environmental goods?

• Mainstreaming vs. compartmentalizing

Lists

• OECD

• APEC

• National lists

• WTO compilation– «Convergence list»

• «Climate change» list

Defining goods

• Environmental goods– dual use

• Environmentally preferable products– relativism in time and space

• Environmental goods = industrial goods?

NAMA +, scenario I

• Market access as priority• Extension of tariff negotiations• Trade performance as main criterion

– assessing reciprocity• statistical approach and its deficiencies

• Applied tariff differential (developed – developing) is in 2-3 percent range– going down as a result of unilateral liberalization– environmental projects enjoy tariff waivers

NAMA +, scenario II

• Environment as priority

• Going beyond tariff negotiations– NTBs

• Links to services negotiations

• Agricultural goods (?)

• Rules (?)

NTBs: defining the scope

• NAMA: mandate on NTBs

• Notifications proved difficult

NTBs

• “Critical mass” approach?• Practicality of negotiating objectives within the

time-frame (?) for DDA negotiations• Reports on status of request-offer negotiations

conducted bi- or pluri-laterally from Chairs of such negotiating groups

• Hear presentations from NAMA Members pursuing particular initiatives in other Committees and Negotiating Groups

Services-led negotiations?

• Environmental projects– goods account for 5-15 percent

• ES play a role in the negotiations under Article XIX of the GATS

Negotiating dynamics

• Phased-in commitments– telecom, banking, insurance, distribution,

business, postal and courrier, construction

• Sectoral focus of current schedules– 44 percent of membership

• Sectoral pattern of offers– less than 10

Reality check

• Only 10% of the total EGS may actually be traded

• Equipment: 35-45%

• Services: 15-20%– over 50 percent are low tech - high volume

• Goods and services: are they interrelated? In trade? In markets?

• Projects as main vehicle

Alternative approaches

• Bringing negotiations closer to real life situations

• Refocusing on environment

Project approach

• Unilateral project definition (India)– apparently designed after CDM

• Concessions limited in time, in scope

Integrated approaches

• Combination of a list and project approach (Argentina)

• List of private and public entities eligible for enhanced market access of relevant goods and services (Argentina, India)

Compatibility test

• Absent any new and particular rules– analysis of WTO law, as it stands, shows a number

of uncertainties– MFN, like product, general exceptions,

jurisprudence

• WTO Members are free to negotiate a new framework– would form part of the WTO system– on a par with other agreements and will prevail as

lex specialis over more general provisions

Environmental area approach

• Environmental areas as point of convergence– UNCTAD expert meeting, July 2003

• Start with multilaterally agreed goals and targets– MDGs, MEAs, other agreements

• Proceed to technical negotiations– goods, services, standards, investment measures,

IPRs, domestic regulation, other areas• Result: schedules (bindings), changes in rules

(as appropriate), and protocols (measures of support)

Main areas

• Water and waste-water management– UNCTAD expert meeting, July 2003

• Renewable energy– UNCTAD expert meeting, February 2005

Climate change

• Climate change under environmental area approach?

• US– «WTO Climate Initiative»– negotiation of parallel EGS Agreement

• EU, US: early action on «climate-friendly» technologies

• Proposal by Brazil: biofuels

Renewables

• UNCTAD’s expert meeting, Feb. 2005– goods, equipment, technologies, biofuels

• Limits to tariff liberalization

• Need for international deployment strategy– support measures– scope for trade and trade policy

Agricultural goods

• Ethanol

• Organic agricultural products– proposal by Brazil

Identifying issues

• List of renewable• Standards

– energy efficiency• building materials, electric appliances

– carbon content???

• Subsidies– non-actionable subsidies for renewables?– phasing out of subsidies for fossil fuels???

• Investment measures– local content requirements

• Government procurement

Fall back option

• Request and offer

• Managing risks

• Tailor-made outcome

• NTBs– proposal by Brazil

Climate change, GHG emissions reduction

Agriculture

Biofuels

Environmental goodsand services

Air pollutionRenew

ables

Organics

Overriding considerations

• How to ensure the negotiations and their outcome are commercially meaningful and financially viable?

• How to make negotiations serve the higher purpose of environmental technology transfer?