In Brief

WTO MEMBERS TABLE FOREST, FISH LIBERALISATION PROPOSALS

At a meeting of the negotiating group on non-agricultural market access (NAMA) on 2 February, two groups of WTO Members presented their proposals for the enhanced reduction in tariffs on fish and forest products and gave updates on progress in informal meetings that have been held on the issues. Canada, Hong Kong, New Zealand, Thailand and the US tabled a proposal on forest products (TN/MA/W/64) and Canada, Iceland, New Zealand, Norway, Singapore and Thailand submitted a proposal calling for enhanced liberalisation of trade in fish and fish products (TN/MA/W/63) (see Bridges Trade BioRes, 28 October 2005). Both proposals highlighted that developing countries could benefit from enhanced market access if tariffs were dramatically reduced in the sectors, and suggested that tariff liberalization could enhance the incentives for natural resource use in a manner supportive of sustainable development. In their presentations, the proponents of the proposals pointed out that informal talks have continued to take place between the Members that had put forth the proposals and others considering joining onto the initiative for enhanced tariff reductions in the sectors. While these talks have yielded some agreement on the scope of product coverage and that a critical mass of exporters of each product group would be necessary to initiate enhanced tariff reductions in the sector, Members still have to discuss special and different treatment and other issues.

While welcoming the update, WTO Members in the NAMA committee pointed out that consideration of increased or accelerated liberalisation in particular sectors would have to be put on the backburner until negotiations on the scheme for determining overall NAMA liberalisation had seen more movement. Controversy in the NAMA Group has centred on developing countries' need for flexibility in choosing by how much to reduce their tariffs, and in particular whether developing countries could have both a high coefficient on their tariff reduction formula (allowing for lower tariff cuts) AND be exempt or make lower tariff cuts on some sensitive products. The meeting was unable to resolve disagreement on what type of formula should be used to cut tariffs on non-agricultural products, including natural resources, but a 'NAMA group' was created that includes several developing countries looking to defend their policy space for national industrial development strategies (see Bridges Weekly, 8 February 2006). Ambassador Donald Stephenson of Canada will, as of 27 February, begin his new position as chair of the NAMA negotiating group by leading an open-ended session on sectoral initiatives in which Members will consider the way forward on the issue.

ICTSD Reporting.

NEW EU BIOFUEL STRATEGY: EXPORT POSSIBILITIES, BUT WATCH FOR NATURAL RESOURCES

On 8 February, the European Commission presented its new biofuels strategy which outlines a series of measures to promote biofuels within the EU and developing countries. The plan intends to boost the production of fuels such as biodiesel and bioethanol through additional aid and investment in an effort to reduce dependency on fossil fuels and emissions of greenhouse gases. In so doing, the EC seeks "to prepare for large-scale use of biofuels, and to support developing countries where biofuel production could stimulate sustainable economic growth." EU Development Commissioner Louis Michel stressed the potential export possibilities for developing countries, especially those affected by recent EU sugar reforms which cut the purchase price of sugar from African, Caribbean and Pacific countries. The African, Caribbean and Pacific (ACP) group of countries welcomed the initiative last week, but warned that "a secure and substantial fund" should be created specifically for the ACP sugar protocol countries.

While WWF, Birdlife International and the European Environmental Bureau (EEB) welcomed the Commission's commitment to ensuring the environmental sustainability of biofuels, the non-governmental organisations said they were concerned that the new strategy did not guarantee that wildlife would not be harmed. They argued that there was a danger that growing crops for fuels in developing countries could lead to biodiversity losses by, for example, the clearing of rainforest for agricultural production. WWF therefore demanded the introduction of mandatory eco-certification for all biofuels produced in the EU or imported from outside.

"Commission urges new drive to boost production of biofuels," EUROPEAN COMMISSION, 8 February 2006; "The European Union says increased use of biofuels in developing countries could bring huge benefits, especially to those affected by the bloc's sugar reform," IPC, 8 February 2006; "WWF asks for mandatory eco-certification for biofuels," WWF EUROPE, 8 February 2006; "Birdlife urges caution in biofuel drive," BIRDLIFE INTERNATIONAL, 8 February 2006; "Farm commissioner pushes case for biofuels," EurActiv, 10 February 2006.

TANZANIAN GOVERNMENT BANS LOG EXPORTS AGAIN

The Tanzanian government on 27 January decided to ban exports of logs and sandalwood and suspend tree harvesting in protected natural forests in order to address illegal logging. Unlike a similar ban that was in place between October 2004 and August 2005 to safeguard endangered species, give local manufacturers an opportunity to process logs and higher value-added exports of wood products, the 27 January decision was taken in reaction to unsustainable harvesting of timber and the transportation of logs without proper or with forged permits. Timber exporters reacted against the ban, pointing to export permits that were granted in December 2005 with a validity period until March 2006. "We have genuine permits to export logs and sandalwood but this indefinite ban will cost us more than US$ 4.6 million, because we will fail to transport the logs," Juma Idd, Chairman of the Tanzanian forest product exporters association, said. Nonetheless, Saleh Pamba, permanent secretary of the Ministry for Natural Resources and Tourism, pointed out that traders were in contravention of Act No. 14 of 2002 by undertaking harvesting and trade that threatened Tanzania's 44 million hectares of forests and rich biodiversity. As a result of impacts on industries in need of the logs and firewood which provide the most common source of energy, however, the government on 9 February issued special transit passes to allow dealers whose products were not sold after the government decided to ban trade to sell their products within Tanzania until the stocks harvested before the ban are exhausted.

"Tanzania's Move to Save Its Forests Angers Loggers," EAST AFRICAN, 7 February 2006; "Dealers in forest products get temporary permits," GUARDIAN, 10 February 2006; "Tanzania bans log exports again," XINHUA, 2 February 2006; "Rufiji forests under threat as traders defy logging ban," GUARDIAN, 12 July 2005.

EU DELAYS WOOD PALLET RESTRICTIONS ONCE MORE

On 6 February, the European Commission adopted a directive (2006/14/EC) that delays a requirement that wood packaging used to import products into the EU be bark-free until January 2009 to allow time for consideration of the measure by members of the International Plant Protection Convention (IPPC). The EC decision to allow the international community to determine the legitimacy of the measure was taken after complaints from the US that the new rules under Commission Directive 2004/102/EC, which are intended to prevent tree-eating insects from entering into the EU, would disrupt the US$ 80 billion worth of exports that the US sends to Europe annually using wood pallets (see Bridges Trade Biores, 18 February 2005). The IPPC's "Guidelines for regulating wood packaging material in international trade" (ISPM-15), which are recognised by the WTO, only approves of heat treatment and fumigation by methyl bromide as legitimate pest control measures (see Bridges Weekly, 3 November 2004). While recognising that requirements for bark-free packaging ('debarking') is an option, the standard requires that any country adopting this measure must demonstrate that it is "technically justified". Instead of doing so, the EU has decided to ask the IPPC to revise the standard to include debarking requirements along with heat treatment and methyl bromide fumigation as legitimate measures, which the IPPC's Commission on Phytosanitary Measures (CPM) will do in April 2006. The original March 2005 implementation of the requirement has been postponed from March 2005 to March 2006, and the new January 2009 date will be reviewed by September 2007.

The use of methyl bromide, while allowed under ISPM 15 for fumigation purposes, is known to cause ozone depletion and is to be phased out under the Montreal Protocol -- although an exemption allows its use for fumigation. Sources suggested that the Protocol's technical assistance funds could be used to facilitate a transition to the use of heat treatment or debarking for pest control for wood pallets to enable the use of environmentally-friendly -- though more costly -- control methods (see Bridges Trade BioRes, 20 January 2006).

ICTSD Reporting; "EU votes to delay debarking requirement for wood packaging material," USDA GLOBAL AGRICULTURAL INFORMATION NETWORK, 7 February 2006; "Commission Directive 2006/14/EC of 6 February 2006," OFFICIAL JOURNAL OF THE EUROEAN UNION, 7 February 2006; "EU delays packaging rules on tree-eating insects," REUTERS, 7 February 2006.