Competitive Enterprise Institute | 1899 L ST NW Floor 12, Washington, DC 20036 | Phone: 202-331-1010 | Fax: 202-331-0640
The Clinton administration suffered a major setback in its efforts to incorporate environmental restrictions into world trade rules with the completion of talks in the Committee on Trade and Environment (CTE). This arm of the World Trade Organization recently released its 1996 report to be presented to trade ministers at the upcoming WTO trade summit in Singapore (Dec. 9-13). The results did not satisfy the office of U.S. Trade Representative (USTR): "We wish to express our disappointment that the CTE has not significantly advanced the understanding of environmental concerns," said a USTR statement. "We do not concur with certain of the Report's conclusions."
A long-term Clinton administration goal has been to legitimize the use of trade sanctions and other discriminatory barriers in world trade rules for environmental policy purposes. "Embarrassed U.S. trade officials are reluctant to admit the real reason for their failure -- the 'green' trade agenda was rebuffed by developing countries," said James Sheehan, research associate for the Competitive Enterprise Institute.
A coalition of developing countries, including India, Egypt, and the ASEAN nations, were instrumental in resisting U.S., European Union, and Canadian pressure during two years of talks in the WTO environment committee. Their chief fear was that the WTO would be used for "green protectionism" -- trade protection disguised as environmental protection. In Singapore, a similar North-South clash is brewing over the issue of trade and labor standards.
"Pacific rim officials recognize that the Clinton administration's divisive proposals could do enormous damage to the economic prospects of the Third World," said CEI's Sheehan. "Global environmental rules, as well as labor standards, are designed to exclude poorer countries from world markets, thus they are inappropriate subjects at a summit which purports to be advancing global free trade."
The U.S. was particularly miffed by the environment committee's refusal to state that "WTO rules should not hamper the ability of MEAs [multilateral environmental agreements] to achieve their environmental objectives." Several environmental treaties impose trade restrictions against products or non-parties, such as the Basel Convention (regulation of trade in hazardous waste and recyclables) and the Montreal Protocol. Without a revision of world trade rules, these environmental accords could be inconsistent with treaty obligations to the WTO.
The CTE Report's content may signal the growing developing country opposition to the use of trade sanctions in international environmental treaties. The Report states that "there is no clear indication for the time being of when or how [trade sanctions] may be needed or used in the future." Administration officials complained that this language "contradicts recent negotiations of both the Biosafety Protocol of the Biodiversity Convention and the Convention on Prior Informed Consent for Toxic Chemicals and Pesticides.
CEI will be represented at the summit by Fred Smith, president, and James Sheehan, research associate. For more information, contact Greg Smith at (202) 331-1010 or gsmith@CEI.org.