Memorandum submitted by the Royal Society
for the Protection of Birds
SUMMARY OF
MAIN RECOMMENDATIONS
There should be an environmental and social
impact assessment of the current trade regime either before, or
as part of, further negotiations in order to inform their scope
and content. The EC's Sustainability Impact Assessment is inadequate
as it will only consider the impacts of the EC's proposed agenda
for further negotiations.
The UK and EC should commit not to negotiate
biotechnology issues in the World Trade Organisation (WTO) as
this could adversely affect the development and/or implementation
of an effective Biosafety Protocol under the Convention on Biological
Diversity (CBD).
The UK Government should seek to alter those
WTO rules that, in its opinion, prevent it from implementing a
precautionary moratorium on the commercial planting of GM crops
while further scientific testing is conducted.
The EC should narrow its negotiating agenda
to allow developing country WTO members to effectively participate
in trade negotiations and implement any resulting agreements.
1. INTRODUCTION
1.1 The RSPB welcomes this opportunity to
give evidence to the Environmental Audit Committee.
1.2 The RSPB is the largest wildlife conservation
charity in Europe, with over one million members. We take action
for wild birds and the environment, with a strong interest in
conserving all biodiversity. The RSPB is the UK partner of BirdLife
International, a global network of conservation organisations
working in over 100 countries.
1.3 The greatest threat to birds—and
biodiversity more widely—is habitat loss. The loss of habitats
all over the world is being driven by a wide range of factors,
many of which are inextricably linked with national and international
economic policies. International trade and the rules that govern
it thus have a direct and important bearing on the RSPB's core
concerns.
1.4 Further, the RSPB and BirdLife International
take a keen interest in wider policy areas concerning sustainable
development. Biodiversity conservation is a key aspect and test
of sustainability, and international macro-economic policy has
a significant impact on biodiversity and consequently a central
role to play in achieving sustainable development.
1.5 The RSPB is thus well qualified to provide
evidence on this issue and has a track record in making the links
between trade and sustainable development issues. For example,
the RSPB submitted evidence to the House of Commons Environment
Committee inquiry into "world trade and the environment"
in February 1996. The RSPB will also be attending the WTO Ministerial
Conference in Seattle in November.
1.6 Following some brief general comments,
this memorandum will divide into three parts, in relation to three
of the proposals on which the Committee requested evidence, namely:
— The Communication from the European
Commission (EC) to the European Council and to the European Parliament
"The EU Approach to the Millennium Round":
— The EC's proposal and terms of reference
for a "sustainability impact assessment" of the future
trade negotiations:
— The UK Government publication; "The
UK and the World Trade Organisation: an Introduction to the Next
Round".
2. GENERAL COMMENTS
2.1 The RSPB welcomes the efforts of the
European Commission and the UK Government to address sustainable
development issues. However, we are very concerned that such efforts
will fall short of a coherent strategy to integrate sustainable
development into trade policy. The following points are of particular
importance:
There is an implicit, and in some cases explicit,
assumption in the three papers mentioned above that trade liberalisation
always and necessarily benefits people and the environment. However,
there have been no comprehensive independent studies of the social
and environmental impacts of the trade regime in general (ie the
content and implementation of the Uruguay Round agreements). The
EC has so far opposed any assessment of the impacts of the current
trade regime. The RSPB believes that such research should be conducted
before or during further trade negotiations in order to inform
their scope and content.
Both the EC and UK papers see trade policy as
separate from, rather than an integral part of, wider policy areas.
Notable omissions from the three papers include issues of equity,
cost-internalisation, debt, commodity dependence, the ownership
and sustainable use of natural resources and worsening terms of
trade—all issues which are inextricably linked with, and
affected by, international trade and investment. The RSPB believes
that, although not the responsibility of the WTO itself, "flanking
policies" to address such issues should form part of the
overall "trade policy strategy" of WTO members.
There is no recognition of environmental limits
in any of the papers even though this concept is recognised in
the UK Government's Strategy on Sustainable Development. Policies
that pursue sustainable development—whether economic, environmental
or social—need to recognise the limits of the global environment.
Of particular concern to the RSPB is biodiversity loss. In this
regard it would have been helpful for the three papers to have
mentioned unsustainable patterns of consumption, how these interact
with trade and investment rules, and what kind of trade or other
policies are required to deal with them.
The RSPB believes that international trade rules
are required to regulate the actions of governments and companies.
However, it is important to recognise that liberalisation is not
the only trade policy option available and it is not always appropriate.
Therefore, the WTO should not be an organisation devoted solely
to trade liberalisation. Instead, international trade policy should
be based on managing trade to benefit people and the environment.
The RSPB believes that the WTO is, and should
remain, a trade policy organisation. However, trade policy is
a means to an end and not, as the actions of the WTO and some
of its members seem to suggest, an end in itself. The goal of
the rules-based trade system should be sustainable development
and, as such, the impacts of trade rules on people and the environment,
and on social and environmental policy-making, must be recognised
and addressed. This requires developing an understanding of these
impacts and, where necessary, changing the rules to deal with
them. It also requires a coherence of policy between the WTO and
the other international mechanisms—such as the Convention
on Biological Diversity (CBD) and the Framework Convention on
Climate Change (FCCC)—to which most WTO members are also
signatories.
3. THE EC COMMUNICATION:
"THE EU APPROACH
TO THE
MILLENNIUM ROUND"
3.1 Rationale
3.1.1 The EC's underlying rationale for
further trade liberalisation, and for its comprehensive Millennium
Round agenda, is flawed in the following ways:
The EC partly justifies a comprehensive round
of trade liberalisation negotiations on the basis that, "in
view of the pressures the international economy is now under,
there is a risk of slipping backwards [into protectionism]"
(page 5 para 1). Such a view overstates the case for a new round
in view of the fact that any "backward" slide into "protectionism"
could be prevented by upholding the already rigorous regime of
trade rules.
The EC also claims its Millennium Round agenda
is required because, as the financial and economic crisis in Asia
and Latin America "has shown, more and better focused
liberalisation, rather than less, is needed if economic growth
is to be restored" (page 5 para 1). However, analysis
of the financial crisis in these regions has shown the need for
the regulation of currency and property speculation rather than
more trade liberalisation[1],[2].
If anything, the financial crisis provides a compelling case for
a better understanding of the interaction between deregulated
financial markets, investment and sustainable development. Such
an understanding could begin to be developed through an assessment
of the impacts of the trade regime. Finally, when the EC talks
of "restoring growth" it does not mention where and
to what level. This is a crucial omission as there are many different
economic growth rates world-wide which could require different
approaches to "restore" and which would have varying
social, economic and environmental effects.
The available evidence contradicts the EC's
assertion that the "principle of a single undertaking
constitutes the only guarantee of benefits of a Round to all members.
." (page 6 para 2).
From a purely economic standpoint, an Organisation for Economic
Co-operation and Development (OECD) assessment of the Uruguay
Round agreement—which was a single undertaking—predicted
that the countries of sub-Saharan Africa would lose rather than
gain[3].
This was backed up by a United Nations Conference on Trade and
Development (UNCTAD) study which also predicted potential losses
for developing world WTO members from the Uruguay Round[4].
The predictions have been borne out by experience. At a recent
conference in the USA, UNCTAD secretary general Rubens Ricupero
said that, "whatever the theoretical benefits of trade
liberalisation, the empirical record is otherwise"[5].
The apparent disparity between the theory and reality of trade
liberalisation further strengthens the case for a social and environmental
assessment of the current trade regime.
3.2 Agriculture
3.2.1 It is widely recognised that intensive
agriculture has harmed the European environment. A recent European
Commission report confirms this, and also confirms that this is
not accounted for in policy-making, saying, "Intensive
industrial farming has taken little or no heed of its impact on
the environment. This aspect is still not a central component
of discussions or decision-making at either individual or collective
level"[6].
This view is reinforced by the lack of recognition in the EC paper
(pages 6-8) of the importance of tackling intensive agricultural
practices.
3.2.2 An understanding of the environmental
and social impacts of current policies and the relationship between
trade policies and intensive agriculture is crucial for the mandated
negotiations on agricultural trade that form part of the WTO's
"built-in-agenda". Although such an understanding is
required by Article XX of the Agreement on Agriculture (AoA),
which says that these negotiations should take into account "non
trade concerns" (eg the environment), there is no indication
in the EC paper (pages 6-8) that this understanding already exists
or that specific measures are being taken to develop it. The RSPB
believes that there should be a social and environmental impact
assessment of the AoA—either before, or as part of, the
negotiations—in order to inform their scope and direction.
3.2.3 The EC's Common Agricultural Policy
(CAP) is still in need of substantial reform in order to promote
more sustainable agriculture and rural development. Since the
failure of the "Agenda 2000" process to make significant
changes to the CAP, the mandated WTO negotiations on agriculture
provide a further opportunity to achieve this. WTO negotiations
also present an opportunity to use trade policy to pursue the
food security and development objectives of developing countries.
3.2.4 Sadly, the EC paper takes a somewhat
short-sighted view of the opportunities for reforming CAP in the
context of further trade negotiations. It identifies support systems
in other countries (notably export credit arrangements in the
USA) that it would like to get rid of, and market access that
it would like to gain, yet there is no indication in the EC paper
(page 7) that it is prepared to negotiate reductions in its own
export subsidies and domestic supports.
3.2.5 The EC paper (page 7 para 5) describes
the need for a "successful defence" of what is known
as the "blue box" (a range of currently permitted support
measures that, although globally applicable, are largely used
by the EU). This gives a strong indication that it would like
to maintain the current CAP regime. However, if agricultural trade
is to become more environmentally beneficial and socially equitable,
the EC will have to go far beyond the recent Agenda 2000 reforms.
In this regard, the paper mentions that a European Council meeting
in Berlin stated that "Agenda 2000 would constitute essential
elements in defining the Commission's negotiating mandate for
the future multilateral negotiations at the WTO" (page 8
para 2). Crucially, this does not make clear whether the EC sees
Agenda 2000 as defining either its opening position for the negotiations
or a limitation on where it would like to end up.
3.2.6 The main objective of the AoA—to
achieve "substantial progressive reductions in support and
protection" (ie "liberalisation)—needs to be changed.
The focus of the agreement, and the negotiations, should be on
using the trade system—whether liberalisation or agricultural
support—to pursue the production of safe, healthy food in
a sustainable way and to support food security and rural development.
The EC paper acknowledges this to some degree in its desire for
the recognition of the "`multifunctional' role of agriculture"
(page 7 para 4). This is potentially a step forward as it recognises
that agriculture is more than just producing the lowest cost food
for international markets; environmental, social and cultural
values are also at stake. However, it is vital that "multifunctionality"
is not used as an excuse to maintain or extend the EU's current
environmentally damaging, socially destructive and unfair agricultural
regime.
3.2.7 Although not mentioned in the EC paper,
the USA has suggested that biotechnology issues should be discussed
as part of the agriculture agenda. The RSPB is very concerned
that any such talks could undermine the negotiation of an effective
Biosafety Protocol under the Convention of Biological Diversity
(CBD). The last Biosafety Protocol negotiations (in Cartagena,
February 1999) broke down because of the trade concerns of a few
economically powerful CBD signatories and it is important that
these trade concerns are not given precedence in the WTO over
the protection of the environment. The effective regulation of
trade and use of Genetically Modified Organisms (GMOs) is an important
environmental issue and should be dealt with in an international
environmental agreement. The RSPB would like a commitment from
the UK and the EC that there will be no negotiation of biotechnology
issues in the WTO, as this could adversely affect the development
and/or implementation of an effective Biosafety Protocol.
3.3 Tariffs on non-agricultural products
3.3.1 The RSPB welcomes the EC's suggestion
(page 13 para 3) that the current Generalised System of Preferences
scheme—using the tariff system as an incentive for environmental
and social improvements in the developing world—could be
expanded. This is consistent with the fiscal policies of some
EU member states to increase tax on environmentally/socially harmful
activities and/or reduce tax on environmentally/socially beneficial
activities.
3.3.2 The RSPB welcomes the EC's proposal
(page 14 para 2) to commit to duty free access for "essentially
all products from least developed countries" (LDCs), although
it will be important to monitor, and if necessary ameliorate,
any adverse impacts on those LDCs already receiving tariff preferences
(eg under the Lome Convention) and/or the above-mentioned proposals
to expand the GSP system. Also, at this point it is uncertain
what "essentially all" means, so questions still remain
over what products could be left out of this commitment. Also
uncertain is whether the EC is prepared to unilaterally take this
measure, or will only do it if other developed and newly industrialised
countries do likewise.
3.4 Trade and Environment
3.4.1 The RSPB believes that sustainable
development should be the primary objective of international trade
policy. We welcome the EC's commitment to make sustainable development
the "central benchmark" of further trade negotiations
(page 14 para 4). This is a first step in making operational the
commitment to sustainable development enshrined in the preamble
of the Agreement Establishing the World Trade Organisation.
3.4.2 The incorporation of environmental
concerns into the EC's approach has been described as follows:
"Environmental considerations should be
integrated into the EU's approach and therefore effectively addressed
throughout the negotiations so as to achieve at the end of the
Round an overall outcome where environmentally friendly consequences
can be identified in the relevant parts of the final package".
(page 14 para 4).
The identification of "environmentally
friendly consequences" in "relevant parts of the final
package" is potentially very different from committing to
a final package where the overall environmental benefits outweigh
the environmental costs. This position needs clarifying.
3.4.3 The RSPB welcomes the EC's proposal
to clarify the relationship between WTO rules and:
— Multilateral Environment Agreements
(MEAs).
— Non-Product Related Process and Production
Methods (in particular eco-labelling schemes).
— Core environmental principles such
as the Precautionary Principle.
3.4.4 Doubts have been expressed by developing
country WTO members concerning the potential use of environmental
measures as forms of "protectionism". Such concerns
need to be addressed both within discussions on the above three
environmental issues and more generally through discussion of
the capacity, implementation and development concerns of developing
countries. A significant step could be taken in this regard if
the EC dropped its broad agenda—which many WTO members do
not have the capacity to negotiate—and accepted the need
to deal more formally with capacity and implementation issues.
3.5 Trade-Related Aspects of Intellectual
Property Rights (TRIPs)
3.5.1 There are significant linkages between
the Trade-Related Intellectual Property Rights Agreement (TRIPs)
and biodiversity. The world's largest remaining terrestrial reservoirs
of biodiversity are located in the developing world. If this biodiversity
is to be conserved, adequate arrangements to ensure sustainable
use, benefit sharing and transfer of technology and resources
must be implemented. We are concerned that potential conflicts
exist between the TRIPs agreement and Articles 8, 10, 15 and 16
of the Convention on Biological Diversity (CBD) [7].
3.5.2 In our view, enough questions exist
concerning this conflict, the possible impacts of life-form patenting
on agricultural biodiversity, and the lack of capacity in some
developing countries to ensure implementation of TRIPs, to warrant
no further expansion of the Agreement. Instead, the current mandated
review of TRIPs (as part of the WTO's "built-in-agenda")
should assess the impact of the Agreement on biodiversity and
development with a view, where necessary, to rolling back aspects
of the agreement and ensuring that enough room exists to allow
countries to pursue biodiversity conservation and development
objectives. Specifically, countries should be allowed to exclude
life-forms from patenting if it is deemed to be potentially harmful
to biodiversity or rural communities. A review should also consider
the need to extend implementation deadlines and/or provide financial
assistance for implementation. To this end, the EC's statement
on TRIPs (page 16 para 2) that, "Present achievements
and the current transitional periods must not be re-opened
on the occasion of new negotiations" (emphasis added) is
of great concern.
3.6 The New Round and Development
3.6.1 The RSPB welcomes the EC's commitment
(page 19 para 2) to addressing the needs of developing countries.
However, the EC's promotion of a comprehensive round is contrary
to the ability of many developing country WTO members to negotiate
on several issues at once[8].
3.6.2 It is also contrary to the financial
and technical ability of some countries to implement the range
of agreements likely to result from the EC's broad agenda. Recent
research by the World Bank shows that the cost of implementing
just three of the Uruguay Round trade agreements can run into
hundreds of millions of dollars—a cost that many WTO members
cannot afford[9].
The report states that implementation of these agreements has
been ". . .imposed on [many developing countries] in an imperial
way, with little concern for what it will cost, how it will be
done, or if it will support their development efforts"[10].
3.6.3 Therefore, the RSPB believes that,
given the clear limitations on developing country capacity to
negotiate and implement a wide range of trade agreements, the
EC's broad agenda is not sustainable.
4. THE EC'S
PROPOSED SUSTAINABILITY
IMPACT ASSESSMENT
4.1 General
4.1.1 The RSPB welcomes the EC's commitment
to conducting a Sustainability Impact Assessment (SIA) of its
"new round agenda" in the Autumn of 1999 and continuing
this SIA during the course of the coming negotiations. However,
a number of questions exist concerning the terms of reference
for this study and its potential content.
4.1.2 Perhaps most importantly, the terms
of reference ask for an assessment of the EC's proposed agenda
(page 2 paras 7 and 8). There is no requirement to assess the
impacts of the current set of trade agreements. The RSPB believes
that an assessment of the impact of the existing trade regime
is crucial to understanding the likely impacts of future negotiations.
An ex-post assessment of this kind could also help inform the
scope and content of future trade negotiations.
4.1.3 According to the objectives of the
study, "Trade liberalisation is not an end in itself,
but rather an essential tool for sustainable development. . ."
(page 4 para 3). There is not doubt that liberalisation is one
trade policy tool that may be appropriate in some circumstances
to help achieve sustainable development. However, the RSPB is
concerned that the EC is not considering other trade policy options.
For example, the EC's terms of reference for the contents of the
SIA report (page 6) only ask the consultants to consider how to
pursue liberalisation policies rather than whether to pursue them.
Such terms of reference severely limit the scope of the assessment
and prevent the consultants from considering more creative trade
policy options to contribute to sustainable development.
4.1.4 The terms of reference for the study
state that, "For this exercise, it is taken as a basic
working assumption that non-inflationary growth world-wide will
be boosted by multilateral trade liberalisation and rule-making,
and that this is desirable" (page 4 para 4). We are very
concerned that this assumption will prevent the consultants from
looking into the impacts of increased consumption and the possible
increased strain on natural resources resulting from the expected
economic growth.
4.1.5 The RSPB is keen that the assessment
considers the impact of increased international transport on greenhouse
gas emissions and how this problem should be tackled. This is
especially important in light of the fact that the Kyoto Protocol
on reducing greenhouse gas emissions does not yet encompass many
of the emissions resulting from the transport of internationally
traded goods.
5. "THE
UK AND THE
WORLD TRADE
ORGANISATION: AN
INTRODUCTION TO
THE NEXT
ROUND"
5.1 General
5.1.1 According to the UK Government paper,
"It is widely recognised that free trade contributes to
development" (page 2 para 3). However, what the government
does not mention is that "interventionist" trade policies
are also appropriate for development in some cases. For example,
according to the South Centre, "The experience of Japan
and South Korea shows that these countries have adopted policies
during their periods of industrialization and fast economic growth
which are quite the opposite of those recommended by the multilateral
financial organizations. For example, in the relevant periods,
the two countries have implemented widespread import controls,
discouraged foreign investment and followed a vigorous state-directed
industrial policy. Yet they have achieved extensive structural
change and raised the standard of living of their peoples to European
levels"[11].
Trade policy should therefore seek to encourage appropriate policies
for different circumstances rather than just "free trade".
5.1.2 Like the EC, the Government paper
uses the financial crisis in Asia and Latin America to justify
further liberalisation, saying, "The recent financial
turmoil in some countries has made it all the more important to
keep the momentum going towards greater liberalisation"
(page 8 para 3). Again, it is important to stress that the financial
crisis has shown a need for greater regulation of speculation
and currency markets[12]
rather than a need for trade liberalisation.
5.2 Food Safety, Plant and Animal Health
5.2.1 The Government paper states that WTO
rules allow it ". . .to take a precautionary approach
by adopting provisional measures where information is still insufficient,
provided that a serious attempt is made to establish a more informed
basis for action within a reasonable period of time"
(page 14 para 2). This contradicts a statement made in October
1998, by the then Agriculture minister Jeff Rooker MP, who said
that the Government cannot impose a precautionary moratorium on
the commercial planting of GM crops while further scientific testing
is conducted, because it is illegal under trade rules[13].
The Government's adherence to this legal advice is preventing
it from adequately regulating the possible commercialisation of
GMOs in the UK. The RSPB recommends that the UK Government seeks
to alter those WTO rules that, in its opinion, prevent it from
implementing a temporary precautionary moratorium on the commercial
planting of GM crops.
5.3 Technical Barriers to Trade
5.3.1 The Government wishes to "Achieve
greater recognition of international standards as distinct from
conflicting national or regional standards. . ." (page
15 para 1). Yet, the TBT Agreement already recognises international
standards over and above national ones. Specifically, it states
that, "Where . . .relevant international standards exist
or their completion is imminent, Members shall use them, or the
relevant parts of them, as a basis for their technical regulations.
. ."[14]
(emphasis added). It is therefore unclear why the government sees
the need for "greater recognition" of them and how this
could be achieved given the already unambiguous language used
in this part of the TBT Agreement. Moreover, questions already
exist concerning the impact of the current TBT wording on national
environmental standards that are stricter than international standards.
The RSPB is concerned that any further moves to assert the primacy
of international over national standards could weaken the standing
of domestic environmental regulation in international law.
5.4 Trade and Environment
5.4.1 We welcome the Government's wish to
seek clarification of the relationship between MEAs and WTO rules
(page 15 para 4). However, unlike the EC paper, the UK Government
paper does not mention the need to clarify the status of eco-labelling
and the Precautionary Principle in WTO rules. In fact, there is
a contradiction between the EC's wish to review the status of
the precautionary principle and the UK Government's statement
(see paragraph 5.2.1 above) that current rules already allow a
precautionary approach. There is also a contradiction between
this statement and the Government's apparent inability to implement
a precautionary moratorium on commercial GM crop planting (see
paragraph 5.2.1 above). The RSPB believes that the Precautionary
Principle needs to be more fully incorporated into WTO rules concerning
scientific decision-making and risk assessment.
October 1999
1 Bello, W (1998). The Rise and Fall of South-East
Asia's Economy. The Ecologist. 28 (1): 9-17. Back
2
UNDP (1999). Human Development Report 1999. Geneva, United
Nations Development Programme. Back
3
Goldin, I, Knudsen, O and van der Mensbrugghe, D (1993). Trade
Liberalisation-Global Economic Implications. Paris, Organisation
for Economic Co-operation and Development (OECD). Back
4
Weston, A (1995). The Uruguay Round-Costs and Compensation
for Developing Countries, Report to the Group of Twenty Four.
Geneva, UNCTAD/GID/MISC.31.< Back
5
Khor, M (1999). Ex-GATT Chief, OECD Sec-Gen, UNCTAD Chief warn
of WTO agenda being driven by corporate interests. Malaysia.
Third World Network.< Back
6
European Commission (DGVI, DGXI and Eurostat). (1999). Agriculture,
environment, rural development facts and figures. A challenge
for Agriculture. Brussels, European Commission. Back
7
Tansey, G (1999). Trade, Intellectual Property, Food and Biodiversity:
Key issues and options for the 1999 review of Article 27.3(b)
of the TRIPs Agreement. London, Quaker Peace Service Back
8
Rege, V (1998). Developing countries and negotiations in the WTO.
Third World Economics No. 191, 16-31 August 19 Back
9
Finger, J M & Schuler, P (1999). Implementation of Uruguay
Round Commitments: The Development Challenge. Washington,
World Ba. Back
10
Ibid. Back
11
South Centre. (1996). Liberalization and Globalization: Drawing
Conclusions for Development. Geneva, Switzerland. South Centre. Back
12
Ibid 1 . Back
13
In a letter to Friends of the Earth Mr Rooker stated, "there
is no legal power to impose a moratorium on the planting of genetically
modified crops". Back
14
GATT. (1994). Agreement on Technical Barriers to Trade.
Geneva, W Back
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