Examination of Witnesses (Questions 20-33)
MS RONNIE
HALL AND
MR TOM
CROMPTON
6 JULY 2006
Q20 Mr Caton: Can we move on to multilateral
environmental agreements. WWF argues for greater involvement of
MEAs in the WTO process. However, at the same time you say that
the WTO should not be involved in the implementation of existing
MEAs or the negotiation of future MEAs. Could it not be argued
that the greater involvement of the WTOs in MEAs would help form
the kind of coherent policy that you have argued for?
Mr Crompton: I think you suggest
that there is a contradiction I should clarify. We are not suggesting
that MEAs should be involved in WTO rule making. We are suggesting
that the WTO has a clear area of expertise and that is not environmental;
that MEAs have a clear area of expertise and that is environmental.
We need a system to recognise that there are some decisions which
need to be taken which fall outside the proper purview of the
WTO and which the WTO should therefore refer to MEA secretariats.
As I was suggesting, there are precedents already for the WTO
deferring certain decisions (standard setting, for example) to
international bodies.
Ms Hall: Friends of the Earth
has a publication on this issue. We looked at the potential institutions
where discussions about trade and MEAs and disputes over specific
MEAs could take place and you might find it quite interesting
to read it. We found, in relation to the debate, that it would
be better if it came out of the World Trade Organisation and went
to the International Court of Justice or the UN's International
Law Commission, and, in the case of disputes over specific MEAs,
we found also that the ICJ would be an appropriate body or the
Permanent Court of Arbitration. So there are some practical alternatives
available.
Q21 Mr Caton: That brings me nicely
on to my next question, which is about disputes. WWF stated in
their evidence that there is a tension of jurisdiction between
MEAs and the WTO. I suspect that is the line of the document you
are talking about. However, we have heard arguments that the Dispute
Settlement Body has been able to reach satisfactory compromises
between environmental concerns and the WTO. Do you not accept
that?
Ms Hall: It is a grey area. In
relation to the dispute between the US and Europe over genetically
modified food imports, for example, it is true that the final
report that came out was nuanced in certain ways and was not really
questioning the right of the European Union to have these regulations
in the first place. It was rather questioning the ways in which
they were implemented but at the same time it did not defer to
anything that had been agreed in the Convention on Biological
Diversity and the Biosafety Protocol—so it was not black
and white. The way in which we approached our assessment of the
different potential institutions was to look at the level of expertise
they had on environmental issues and also to look at the potential
for governments with particular political interests to influence
the course of debate. We went for the most neutral options, and
found that in the World Trade Organisation, because of the nature
of the way that the deals are struck, and the single undertaking,
you are always giving in one area and getting in another area,
which is not really the best way of developing international law.
Mr Crompton: There is the issue,
of course, of the existing rules and how they interact with one
another. There is also the so-called chill effect, the impact
that the spectre of the WTO in its approach to environmental issues
throws over the development of new environmental agreements and
the interpretation of existing ones. I was speaking a while ago
to an American who is closely involved in negotiating the CITES
agreement, the MEA which governs trade in endangered species.
They said they could not foresee an MEA like that being negotiated
today, given the current climate in terms of multilateral trade
rules. There is an unseen impact here, which is what does not
happen as a result of the failure to reconcile this tension of
jurisdiction.
Q22 Mr Caton: You have already made
clear that you are not over-impressed with the functioning of
the WTO Committee on Trade and Environment. Do you think there
is any chance of it eventually successfully addressing this issue
of the relationship between WTOs and MEAs?
Mr Crompton: The current mandate
precludes that. The current negotiating mandate, for example,
precludes any agreement which would deal with this thorny issue
of non parties. When a non party to an MEA, like the Kyoto Protocol,
for example, suffered some sort of trade discrimination on the
basis perhaps of redressing the economic benefit it may get from
not signing up to a protocol like that, the current agreement
would say nothing about where a dispute that was brought under
those terms would stand under current trade rules. That, of course,
is the nub of the issue. It is the reason that was sidelined in
the course of crafting the current negotiating mandate. In terms
of immediate negotiations, the answer is no. In the longer term,
I come back to this point, as I see it, that we need to build
that confidence and build that political will and we need developed
countries to demonstrate that they can seriously take steps to
address environmental concerns, even where that is not in their
immediate economic interests. Until we do that, I think we can
look forward to the CTE sitting around in as stagnant an atmosphere
as it seems to be in at the moment.
Ms Hall: There is an issue as
well, which I think you touched on in your initial question and
the WWF in their evidence, about the participation of the MEAs
in the Committee on Trade and Environment. I think that is an
example of how poorly it is working, in that people from the MEA
secretariats are almost never invited to participate in the discussions,
and when they do, they have to sit there until the end of the
session and then make a final comment, so, even if they can get
into the room, they feel they are not able to participate properly
in the negotiations and that is no way to proceed at all. In answer
to your question: theoretically, yes, maybe the CTE could at some
point in time reach some resolution, but there is no evidence
to indicate that that is going to happen in the absence of a real
overhaul of our multilateral trade institutions.
Mr Crompton: That is an illustration
of the farcical lack of coherence at the moment that you have
between these two jurisdictions: the WTO is negotiating on the
relationship between the WTO and MEAs, and MEAs, by and large,
are not allowed in the room.
Q23 Mr Caton: You say that ultimately
we need a single international body to consider trade and sustainable
development. In reality, do you not think we are likely to continue
to have a trade association balanced by MEAs for the foreseeable
future?
Mr Crompton: Are you referring
there to something the WWF said?
Q24 Mr Caton: I am not sure. One
of you said that.
Ms Hall: I do not think we said
that.
Q25 Mr Caton: Someone is claiming
you did.
Mr Crompton: We envisage, as I
have said, the increase in capacity to be able to draw on the
expertise of those international organisations which have environmental
or developmental concerns at the core of what they are about and
to delegate certain decisions from the WTO to those. Yes, I believe
we need an organisation which governs multilateral trading relations
and I believe that organisation should focus narrowly on the implementation
of that set of rules. But, when it comes to the interface between
those rules and environmental or developmental concerns, there
is a need for more input. It simply does not work that the arbiters
of where these balances are struck between developmental, environmental
and economic things are solely trade laws, in terms of the ultimate
recourse of the WTO dispute settlement process. There needs to
be a reference and an input from alternative institutions. Whether
those fit together ultimately through the auspices of some sort
of UN agency which has oversight of both, is to my mind an open
question and one for the longer term, but it is clear to me that
in the short term we need to be seizing the opportunities we have
in the current round to be able to build the precedence for that
type of engagement from organisations with the expertise that
we need.
Ms Hall: I think the debate has
to be moved outside the World Trade Organisation but whether it
is an institution or some kind of forum for discussion is up for
further discussion basically.
Q26 Mr Caton: Can we move on to bilateral
agreements. It is alleged in a report by the WWF on the sustainability
of bilateral fisheries agreements between the EU and West African
countries that it ". . . seems questionable whether these
new agreements are indeed moving towards sustainability".
Can you expand on that? If that is the case, is that symptomatic
of other bilateral trade agreements?
Mr Crompton: I cannot, I am afraid.
We have somebody who specialises specifically in fisheries agreements.
I do not know, is there provision for my taking the question and
giving you a written answer?
Colin Challen: Certainly.
Q27 Mr Caton: We would be very grateful
for that. This is not necessarily fisheries, but do you feel bilateral
trade agreements have improved in their sustainability in recent
years?
Ms Hall: I do not work specifically
on the issue myself at the moment, although it is going up our
internal agenda, but I do work with colleagues who focus very
much on bilateral agreements, particularly between the US and
Latin America, and the US and various Asian countries, and I have
heard nothing that would indicate that—and possibly the
opposite, that, as the US, for example, sees that it is not getting
what it wants in the World Trade Organisation on issues such as
foreign direct investment and intellectual property rights, it
is probably upping the ante in the bilaterals and regional trade
agreements.
Mr Crompton: To return to my theme
of seizing those precedents where they arise at the moment, the
EU is in the course of opening negotiations for a framework agreement
with China. This is not a formal trade negotiation but it will
set the framework over which trading relations and indeed investment
relations between the EU and China will evolve in the coming years.
There would seem to be an opportunity for the EU again to begin
to substantiate some of its assertions on the part of the importance
it gives to sustainable development. One example would be that
we would like to see that used as a means to reach a common market
for energy efficient goods. Some Chinese producers of white goods
produce energy efficient goods for which they do not have full
access to the European markets because of tariff access restrictions
to the EU. Here would be an example where the EU could take a
step which demonstrated the importance that it attached to using
trade rules in order to promote, in this case, the emergence of
more sustainable business in China, which is in all our interests.
Because it is a bilateral agreement, the EU has far more latitude
clearly to be pursuing that type of outcome than it does in the
context of a multilateral negotiation.
Q28 Mr Caton: Do you see this problem
of sustainability in bilateral agreements impairing the incorporation
of sustainability into multilateral agreements?
Ms Hall: I do not quite understand
the question.
Q29 Mr Caton: If you have a bilateral
agreement that does not have sustainability or adequate sustainability
built into it, when you come to a multilateral agreement is there
any evidence that that impairs or lowers the standard for the
multilateral?
Ms Hall: I do not think it is
an issue that has arisen, to the best of my knowledge.
Mr Crompton: I do not know. There
is a more general point there which is, were a country to take
a more progressive precedent in the course of negotiating a bilateral
agreement, it would be difficult for it to retreat from a similar
level of ambition when it was subsequently engaging in a multilateral
agreement.
Ms Hall: Maybe you could make
a comparison with developmental bilateral agreements and the Cotonou
agreement and how it has been transformed into the Economic Partnership
Agreements. Almost the opposite has happened, where there were
bilateral or inter-regional agreements with the EU and the ACP
countries which were focused on development, which have now, because
of the strength of the multilateral trading system and the dominance
of the free trade agenda, been transformed into trading agreements
which the developing countries are much less happy about.
Mr Crompton: You might want to
ask Richard Tarosofsky that question in the next session.
Q30 Colin Challen: Very well. I have
one last question. In tackling climate change the World Bank has
said that globally we should be investing something like $300
billion a year up until 2030 in clean air technologies. Do you
see the WTO as being an organisation that is fit for purpose to
deliver that or to enhance our delivery of that level of investment?
Mr Crompton: No.
Q31 Colin Challen: Is there a particular
barrier which you can identify?
Mr Crompton: To my mind it comes
back to this same issue of how we use international trade instruments
in order to encourage trade in the right type of goods and services.
At the moment, the debate about what the right type of goods and
services might be from a climate change perspective is not one
which impacts at any level as far as I can see in WTO negotiations.
One area where it could be rehearsed is of course on the negotiations
on environmental goods and services. As long as we adhere to what
I have portrayed as being quite a na-£ve approach of simply
coming up with a list of goods and services which may have environmental
benefit, that does not set the precedent we need in terms of thinking
in a more sophisticated way about how we move to a low carbon
economy, and what that would look like in terms of the types of
goods and services that we promote, the trade and investment regimes
that we use to promote them and where we strike the balances on
issues like the one Ed raised about food miles and the export
interest of agricultural economies.
Ms Hall: My answer, for the moment
anyway, is no as well, primarily because I see the WTO moving
in the opposite direction at the moment, where the liberalisation
of energy services is very high on the GATS agenda and oil has
been tabled as a sector for complete liberalisation by the United
Arab Emirates, so they are really thinking about commercial trade
in non-environmentally friendly energy sources.
Q32 Colin Challen: A "low carbon
economy" is not tripping off the lips of all the people—
Ms Hall: They may not have heard
that phrase.
Q33 Colin Challen: They are not aware
of it?
Ms Hall: They may not have heard
that phrase.
Mr Crompton: There is a really
important inversion here as well of the normal perception, that
NGOs like my own are to some extent responsible for, that the
WTO in its rule making is all bad for the environment. I prefer
to take amore agnostic perspective on whether or not liberalisation
is good or bad, but say: How do we put that type of need, how
do we put addressing those types of challenges at the heart of
the decision-making process? Rather than building that set of
rules around the imperative to increase market access or to reduce
subsidies, we are saying: How do we use these intelligently, as
tools which move us in the right direction towards a low carbon
economy? How, therefore, do we interpret and apply that rule-making
process in a positive way, as one of a set of tools that we have
in terms of the international rule making to begin to address
global challenges which we face commonly? At the moment, we are
a very long way off.
Colin Challen: We have come to the end
of this part of the session. I would like to thank you both very
much for getting us off to a very good start in this inquiry.
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