CTE GETS DOWN TO DETAILS ON ENVIRONMENTAL GOODS

Convening for the Special Session of the Committee on Trade and Environment (CTE-SS) from 15 to 16 September, WTO Members focused on how to advance negotiations on environmental goods and largely put aside issues on to the relationship between WTO rules and multilateral environmental agreements (MEA). Moving on from broad debates on approaches to environmental goods liberalisation, delegates got down to more pragmatic discussions regarding the environmental and developmental justifications of specific products.

Identifying win-win-win opportunities

As part of a product-specific process, WTO Members welcomed a meeting convened by the US just prior to the CTE session where it provided case studies on the environmental and developmental benefits of proposed environmental goods. Many delegates felt that such an exercise could help to test the credibility of and streamline the lists, and to critically analyse potential win-win-win opportunities for trade, environment and development. Some Members, including Switzerland and Canada, raised the possibility of holding similar workshops for their goods lists.

On a way forward for the negotiations, Canada proposed to structure discussions according to categories, naming sanitation, wastewater management and renewable energy as three possibilities. Such an approach was seen as a way to clean up existing lists and support developing countries in the preparation of their own lists. The proposal was generally welcomed as a potential starting point for moving to a more detailed debate, although additional categories were expected to emerge in the course of the discussions.

The 'environmental project approach' continued to be promoted by India. Under this methodology, environmental goods and services used in approved environmental projects would qualify for trade concessions for the duration of the project (BRIDGES Trade BioRes, 8 July 2005). In contrast to the previous CTE meeting, India appeared more willing to consider a combination of the project and list approaches, as long as its two main concerns were addressed -- namely that environmental goods chosen for increased liberalisation did indeed contribute to environmental protection and that the 'dual use' issue (i.e. that certain environmental goods may have both environmental and conventional uses) was dealt with.

However, Brazil, while welcoming the US and Canadian initiatives, also insisted on the need to consider criteria for identifying environmental goods. They noted that such criteria would help to more clearly specify the limits of the expected outcome, including the expected scope and volume of trade in the listed goods, and to build confidence among developing countries to come forward with their lists.

The road to Hong Kong

While expectations for Hong Kong are still unclear, observers generally agreed that the finalisation of a list by the Ministerial meeting was unlikely. While discussions in the CTE have for some time focused almost exclusively on environmental goods under paragraph 31(iii), a suggestion by the CTE-SS Chair Toufiq Ali from Bangladesh to drop MEA-related negotiations under paragraphs 31(i) and (ii) until after the Hong Kong meeting was rejected by some. Developing countries in particular feared that such a move could set a procedural precedent, given that so far no other negotiating issue has been formally dropped from discussions in the lead-up to December. In addition, MEA-related issues, which are of particular interest to some developed countries such as the EC and Switzerland, may provide a potential bargaining chip -- on which movement could be achieved in exchange for agreement on an issue of interest to developing countries -- later on in the discussions.

Citing the lack of agreement on other important negotiating items, notably agriculture, several countries highlighted that movement in these areas would be necessary before any major progress on environment-related issues could be expected.

The next regular session of the CTE will be held on 12 October and followed by the CTE-SS from 13 to 14 October.

ICTSD reporting.