Government response
GOVERNMENT RESPONSE TO ENVIRONMENTAL AUDIT COMMITTEE
REPORT: "Outflanked The World Trade Organisation International
Trade and Sustainable Development " (Eleventh Report of
Session 2005-06)
Recommendation 1 (Para 13) The Millennium Ecosystem
Assessment shows that extensive environmental degradation has
taken place, which will have devastating impacts on the poor and
vulnerable in developing countries. The Assessment is clear; concerted
effort is required to address the root causes of such damage including
tackling market failures, weak regulation and a lack of coordination
between international organisations. The Department for Trade
and Industry (DTI), Department for Environment, Food and Rural
Affairs (DEFRA) and DfID all have a clear responsibility to ensure
that messages from the Assessment are heeded and incorporated
across all policies.
1. The Government agrees that the Millennium
Ecosystem Assessment is an important report. DEFRA provided funding
to help with condition and trends aspects of the Assessment, and
to assist with data management. DfID provided funding for the
coordination of the forests working group.
2. We believe the Millennium Ecosystem Assessment
provides a useful and comprehensive overview of recent trends
in ecosystem functions and their relationship with human wellbeing.
It has informed Government thinking in a number of areas, as
detailed in our evidence to the Committee on its inquiry on the
Assessment, and also in our response to the Committee's previous
report, Trade, Development and the Environment: The Role of DfID.
We are committed to working across government to ensure that the
Assessment continues to inform our policies and approaches.
Recommendation 2 (Para 23) It is clear that the
relationship between trade liberalisation and the environment
is an uneasy one. It appears that the main international focus
has been on the liberalisation of trade, with the benefits that
this may bring, while failing to recognise the full environmental
or social impacts that this liberalisation may have. It is paramount
that, where liberalisation is pursued, effective accompanying
measures are adopted to prevent or limit the environmental and
social impacts. Without such measures, international trade liberalisation
is only likely to add to environmental degradation.
3. The relationship between trade and the environment
is undoubtedly complicated. Trade liberalisation increases the
efficiency with which goods and services can be produced, and
can also remove incentives for environmentally damaging overproduction
(e.g. agricultural subsidies). Trade and foreign investment are
also the main mechanisms for transferring technology, which increases
efficiency and can reduce the environmental impact of industrial
processes. The evidence available suggests that increased foreign
investment can improve environmental standards. However, liberalisation
can also foster economic development that can have negative social
and environmental impacts, for which mitigating policy measures
need to be introduced.
4. The Government supports the Committee's view
that flanking measures are needed to mitigate any negative environmental
or social impacts, particularly in developing countries, resulting
from the liberalisation of trade. As the Committee has noted,
we have commissioned some research to look at the effectiveness
of existing flanking measures. The research is due for completion
in March 2007, and we plan to use the results from this and other
studies, such as the Sustainable Impact Assessments (SIAs) commissioned
by the European Commission (EC), in developing future policy.
Recommendation 3 (Para 29) Although research
commissioned by the Government highlighted the importance of flanking
measures, the fact that the 2004 DTI White Paper neglects to consider
explicitly the role that these may play suggests that the DTI
has failed to get to grips with sustainability issues in trade.
5. The Government rejects this conclusion. We
have taken a number of steps regarding the relationship between
trade and sustainable development. The EU, strongly supported
by the UK Government, was instrumental in securing the inclusion
of the environment dossier in the Doha Development Agenda (DDA)
Single Undertaking, with a broad mandate to seek both to liberalise
trade in environmental goods and services and to develop a clearer
framework of rules relating to trade and the environment.
6. The UK Government has also strongly supported
the development of the Trade Sustainability Impact Assessment
SIA by the EC, as a means of identifying the likely impact of
trade agreements on economic growth, social development and the
environment, to enable complementary policy measures to be introduced
to maximise welfare gains through mitigating the adverse economic,
social or environmental impacts of trade agreements. The Commission
is committed to conducting SIAs for all new Free Trade Agreements
(FTAs) as well as for the Economic Partnership Agreements (EPAs)
seeking to identify the likely effects of trade liberalisation
These SIAs look across different dossiers including agriculture,
Non-Agricultural Market Access (NAMA) and services, thereby ensuring
that environmental considerations are taken into account in all
areas of the negotiations.
7. We accept that the SIA process itself is still
under development, and could be improved. However, the EC is committed
to this, and to ensuring that SIAs are used more effectively.
The Commission is currently exploring ways to better integrate
them into trade policy making, a move which the UK Government
very much supports. One crucial element in this process will be
to ensure that flanking measures are put in place to minimise
the potentially negative impact of trade liberalisation on the
environment.
Recommendation 4 (Para 30) We commend the Government's
support for international environmental organisations. We are
nevertheless concerned that there is a clear lack of consideration
as to how trade and environmental policies can be made mutually
supportive. This must include specific commitments in UK policy
that the impact of trade on the environment will be fully considered,
and effective flanking measures to offset the negative impacts
of trade introduced. This issue is too important for it not to
be expressed specifically as Government policy; the Government
must set out how it will seek to address the environmental impact
of trade.
8. The Government does not agree that the impact
of trade on the environment has not been considered when formulating
trade policy, and is not convinced by the argument that a separate
statement of Government policy on these issues is required. The
UK Government's approach to the inclusion of the environment as
a dossier in the DDA and support for the EC's development of the
Trade SIA reflects the importance attached to environmental issues
in Government policy. We continue to consider how trade and the
environment policies can be made more complementary and mutually
supportive. In addition, the UK Government's Sustainable Development
Strategy committed the UK to working through the WTO to:
- reduce unsustainable and environmentally damaging
agriculture and fishing subsidies;
- promote the mutual supportiveness of trade liberalisation,
environmental protection and sustainable development, for example
through strengthening the links between the WTO and the Multilateral
Environmental Agreements that incorporate trade provisions; and
- through liberalising trade in environmental goods
and services.
Recommendation 5 (Para 34) We look forward to
the Government's formal response to the Sustainable Procurement
Task Force National Action Plan. We trust that the Government
will take a positive stance on the document. We hope that sustainability
will be the driving force of procurement policy and adequately
take account of climate change and other global environmental
threats.
9. The Government has accepted the Sustainable
Procurement Task Force's challenge to "use its immense buying
power" to make rapid progress towards our sustainable development
goals as set out in the UK Government Sustainable Development
Strategy - Securing the Future. To achieve this we will take action
through the policies, performance frameworks and procurement practices
that support our sustainable development goals and specifically
deliver progress towards the Government's sustainable operations
targets. The Government will work with the supply-chain to provide
the solutions that will be needed to take the sustainable procurement
agenda forward.
10. Government Departments and the Office of
Government Commerce (OGC) will increasingly seek out innovative
solutions and approaches to procurement, including through early
engagement with the marketplace and the use of outcome-based specifications.
During 2007 Government will be looking to engage strategically
with key sectors to help drive low carbon resource efficient supply-chain.
11. The Government will be driving markets for
innovative eco-technologies through their joint work with procurement
professionals to demonstrate the Forward Commitment Procurement
(FCP) model, pioneered by the business-led Environmental Innovations
Advisory Group. This involves articulating current and future
environmental needs to the market in a way that is credible and
focuses on outcomes and performance standards. This approach is
already being piloted by HM Prison Service to help deliver a zero
waste prison mattress. The Government will work to replicate the
FCP model more widely in the public sector, focussing on those
areas where better, cost effective solutions are needed to achieve
the sustainable operations targets and wider sustainable development
goals.
Recommendation 6 (Para 46) It is paramount that
the CTE fulfils its mandate in scrutinising the interface between
the environment and trade. It is essential, not only for the environment,
but also for development objectives, the CTE is not sidelined
in addressing a wide range of environment-trade issues. We are
concerned that the Government seems to believe that the CTE is
fulfilling its role when we have seen evidence to the contrary.
If the Government is truly committed to a sustainable international
trade system it must, with the EU, be a strong advocate for a
serious and urgent debate on these issues in the CTE.
12. The Government accepts that progress within
the Committee on Trade and the Environment (CTE) has been slow.
However, in light of the restarting of informal negotiations in
the DDA, the EC, fully supported by the UK, intends to work proactively
with developing countries and other members, to reach an ambitious
agreement on all three parts of paragraph 31 of the CTE mandate.
Recommendation 7 (Para 55) It is essential that
MEAs are more extensively involved not only in the CTE but also
in other WTO bodies, especially in light of potential conflicts
which may arise if trade rules and MEA rules are contradictory.
An agreement between relevant MEAs and the WTO which establishes
a mutually supportive relationship with information exchange is
essential for sustainability to be better incorporated into WTO
negotiations. It is also important that MEAs are able to have
substantial impact on negotiations. We agree with the Government
that observer status and information exchange should be a priority,
and we advocate the Government and EC taking a strong line to
ensure that this will be included as part of a completed Round.
13. The Government welcomes the Committee's line
on Multilateral Environmental Agreement (MEA) involvement in the
CTE and other relevant WTO bodies. Both the UK and the EC want
to seek clarification that there is no legal hierarchy between
WTO rules and MEAs. This will lend legal certainty, allowing WTO
Members who are also party to MEAs, to implement trade measures
mandated by MEAs in a manner that is coherent and consistent with
WTO rules. To demonstrate to WTO members that paragraph 31(ii)
is an indispensable part of the trade and environment mandate,
the EC, fully supported by all Member States, submitted a paper
on 31(ii) of the DDA to the CTE in Special Session CTE (SS) in
May 2006, highlighting the importance of information exchange
between WTO committees and the secretariats of MEAs; and the granting
of observer status to MEAs in relevant WTO committees. Many comments
were put forward from WTO members, and the EC is giving consideration
to these.
Recommendation 8 (Para 60) The concerns that
developing countries have with regards to environmental measures,
either that they will be used for protectionist purposes or that
they could hinder development objectives, must be addressed if
we are to move forward on these issues in a truly sustainable
manner.
14. We firmly believe that environmental measures
should not be misused for protectionist purposes against developing
countries. A key element to an ambitious and pro-development outcome
to the Doha Round is opening up developed country markets to improve
developing country trading opportunities. Some developing nations
have expressed concerns that the motives of developed nations
for including the environment in the Doha Round are more to do
with securing market access for goods or for protecting domestic
industries (sometimes referred to as eco-protectionism) than with
protecting the environment. For example, agreement in the Committee
on Trade and the Environment in Special Session (CTE SS) on an
approach to identify those goods which should be classified as
"environmental goods" and should benefit from tariff
reduction is difficult to reach, not least since developing countries
are concerned that the list of goods proposed by developed countries
has been compiled on the basis of trade rather than environmental
considerations.
15. The EC is seeking to address these concerns
through submissions to the CTE (SS), bilateral discussions and
through technical assistance to enable developing countries to
engage in negotiations and implement any future agreement. For
example, the EC, with the strong support of the UK Government,
recently co-sponsored together with 6 countries, including the
US and Japan, a submission to the CTE (SS) outlining in more detail
the environmental and developmental benefits of goods proposed
by developed countries in the areas of Waste Water Management
and Solid and Hazardous Waste Management Products.
16. The UK is also demonstrating support through
the Sustainable Development Dialogues. The Government have signed
agreements with the governments of Brazil, China, India and Mexico
and intends to sign an agreement with South Africa. The Dialogues
are bilateral partnerships that provide an effective mechanism
to promote collaboration and exchange of good practice on a range
of sustainable development issues.
Recommendation 9 (Para 61) We are concerned that
the CTE is now hindering a more holistic approach to the consideration
of these issues. Lack of joined-up thinking will result in missed
opportunities to make trade, environment and development policies
mutually supportive and risks environmental and developmental
objectives being undermined by trade agreements.
17. The Government shares the Committee's concerns
and is keen to work with the EC and Member States to ensure the
CTE advances the progress of trade, development and environment
considerations. Given that the potential outcomes of other parts
of the negotiations could have some negative environmental consequences,
it is disappointing that its proving difficult to demonstrate
our commitment to the environment through the CTE mandate. It
is nonetheless important for the EU, and the UK, to do all it
can. At official level we are doing this through the CTE and
through bilateral contacts with other delegations. Ministers
are also prepared to raise trade and environment in the context
of WTO/Doha discussions with their foreign counterparts, to emphasise
the importance we place on reaching a successful outcome on the
CTE mandate.
Recommendation 10 The UK Government and the
EC must urgently act to reinvigorate the consideration of environmental
issues in the CTE, by insisting that environmental consequences
associated with wider negotiations also be considered. It is imperative
that the UK and the EU works with developing country members to
ensure that they are aware that poverty eradication is heavily
dependent upon a functioning environment, and that the EU will
not compromise their need to develop and eradicate poverty.
18. In many cases, awareness of these issues
in developing countries is already high. However, countries do
lack capacity and tools and technologies to address environmental
degradation. They also need support in balancing environmental
issues with other development priorities, and planning and budgeting
appropriately.
19. The 2006 White Paper on International Development
acknowledges the imperative for development that is sustainable
and fair. It commits the UK Government to identify and respond
to environmental opportunities and risks, for example by helping
them to undertake strategic environmental assessments. It also
states that the Government will work with international partners
to help countries make efficient use of natural resources (particularly
energy and water).
20. An example is the Yunnan Environment and
Development Programme in China. DFID helped the Yunnan provincial
government to integrate environment into policies and programmes
addressing rural poverty. The DFID programme identified ways
to improve poor people's access to environmental resources and
provincial government's environmental management policies.
21. DFID and the German aid agency GTZ co-led
OECD Development Assistance Committee (DAC) work to review experiences
in eight developing countries of national sustainable development
strategies. This resulted in DAC guidance and a resource book
of practical ways to identify poverty-environment links, to balance
local and global issues, to set priorities, and to put in place
systems and capacities for cross-sectoral working and continuous
improvement.
Recommendation 11 (Para 65) We recommend that
the Government and the EU strive to ensure that the WTO process
becomes much more open following conclusion of the Doha Round.
We believe this will encourage the delivery of more sustainable
negotiation outcomes. This would have the added benefit of helping
to ensure that countries can be held more accountable for their
negotiating stances.
22. The report The Future of the WTO (often
referred to as the Sutherland Report), concluded that the organisation
has achieved much regarding external transparency over the past
few years, while recognising that the framework for the WTO's
relations with non-governmental organisations, as well as with
the public generally, should be kept under review. Since the report,
the WTO has taken further steps to increase the transparency of
trade negotiations and processes; the UK Government strongly supports
these developments.
23. Some useful steps have been taken to date,
including establishing the annual WTO Public Forum meeting (held
in September), which enables representatives of Government, multilateral
institutions and civil society to meet and discuss trade issues.
Over 1,000 delegates from all over the world attended the 2006
Public Forum, with the EC providing financial support to enable
the event to take place . We also welcome the decision of the
WTO General Council on the 15 May 2006 to make public all documentation
issued under the General Agreement of Tariffs and Trade (GATT).
These documents can be viewed on the internet at http://www.wto.org/english/docs_e/gattdocs_e.htm.
To date, 51,000 out of a total of approximately 88,000 documents
have been published, and the WTO Secretariat continues to work
to expand this digital archive through cataloguing, scanning and
publishing these papers.
24. The WTO has also sought to address concerns
about the transparency of dispute resolution procedures. As a
first, informal step, public hearings were held in the EU-Hormones
case, and we expect similar public hearings to be held in future.
The WTO has also recently begun publishing one page summaries
of cases, including both key facts and the findings of the panels
, which can be viewed by the public online at http://www.wto.org/english/res_e/booksp_e/dispu_summary06_e.pdf.
Although a formal change of the rules of the Dispute Settlement
Understanding to allow for public hearings would need a final
DDA agreement, this is one of the issues currently being considered
by the relevant committee, and the EU and UK would support such
a change. The Government believes that if the WTO process is to
become more open then clear rules must be established about levels
of information disclosure, public conduct of proceedings etc.
However, as with all decisions affecting the WTO, this could only
be achieved through consensus of all WTO members; we would expect
this to take some time.
Recommendation 12 (Para 77) We are concerned
that a lack of clarification of the legal interface between the
WTO and MEAs is leading to unnecessary uncertainty in the formulation
of new, and the application of existing, MEAs. This therefore
must be addressed as part of a successful Doha Round. We therefore
urge the Government and EC to do all in their power to move forward
on this issue. However, it is of utmost importance that any agreement
reached must acknowledge that MEA and WTO rules have to be mutually
supportive. If negotiations develop in such a way that MEAs look
set to become disadvantaged in comparison to the current situation,
the Government should strongly resist such a conclusion.
25. The Government remains fully committed to
negotiations on trade and environment in the WTO. The UK's desired
outcome is to establish the principle that there is no legal hierarchy
between WTO rules and specific trade obligations in MEAs and that
these equal bodies of law are mutually supportive. Within the
negotiations in the CTE SS, the EC has been leading attempts to
define a set of principles to guide the relationship between the
WTO and the MEAs, to facilitate mutual complementarity. This is
a policy objective the UK supports, although we are reserving
our position until the text of any final agreement in this area
has been produced, in case this undermines existing agreements
or is insufficiently robust.
26. The Government considers that clarifying
that there is 'no legal hierarchy' between WTO trade rules and
trade obligations found in some MEAs will increase the level of
legal certainty, allowing WTO Members who are also party to MEAs
to operationalise the trade mechanisms provided for in a manner
consistent with WTO rules. This will also further extend to the
policy makers negotiating MEAs, providing the legal certainty
for the inclusion of trade measures in an MEA, if that is the
most appropriate method of achieving the environmental objectives.
27. Whilst the WTO has an important role to play
in promoting sustainable development and environmental benefits,
environmental issues cannot be resolved solely within the WTO.
Other international institutions have more relevant expertise
and are better placed to take the lead in tackling these issues,
primarily the MEA Secretariats. However, it is important that
clear and formalised mechanisms for observership and information
exchange between the WTO and the MEA Secretariats are agreed as
part of the DDA negotiations. The EC will continue to press for
these negotiations to be concluded.
Recommendation 13 (Para 81) Moves to address
environment-trade issues may ultimately prove inadequate unless
the WTO can be used to ensure that sustainable development is
more fully considered in trade negotiations, and unless MEAs are
able to protect the environment without the risk of contravening
WTO rules. Although we accept that the Government may be correct
in saying that a new body may create new problems, the current
lack of progress on formulating a coherent approach to these issues
within the WTO suggests that an alternative approach may be needed.
28. The Government recognises and shares the
Committee's concern about the integration of sustainable development
considerations in WTO negotiations. For this reason, the EC and
the UK continue to press in the CTE negotiations for recognition
of the mutual supportiveness of WTO rules and trade-related measures
in MEAs. However, it is important to note that WTO rules do not
prevent countries from introducing environmental legislation,
and nor do they seek to assert legal primacy over MEAs; the two
bodies of law are deemed to be separate but equal. The focus of
negotiations within the WTO has been to develop a set of principles
to guide the relationship between the two and to ensure greater
coherence between them as separate but mutually supportive bodies
of international law. At present, approximately 10% of the total
of around 200 MEAs require or permit the employment of trade measures
to limit environmental harm or to incentivise participation by
non-parties to the agreement. Trade measures take many forms,
including bans, quotas, labelling requirements and requests for
information prior to export. MEAs that include trade provisions
include the Convention on the International Trade in Endangered
Species (CITES), the Cartagena Protocol on Biosafety and the Montreal
Protocol (on ozone-depleting substances).
29. In addition, environmentally-related exemptions
are included in many of the WTO agreements, allowing trade measures
to be taken to protect human, animal or plant life (e.g. GATT
Article XX b). Such measures are allowed, but must be justified
on the basis of a risk assessment, must not arbitrarily discriminate
against another WTO member (e.g. on the basis of country of origin)
and should be the least trade-restrictive measures reasonably
available to achieve the environmental objective intended.
30. Successive rulings by panels convened under
the Dispute Settlement Understanding of the WTO have affirmed
the importance of the principle of sustainable development in
interpreting WTO agreements. To date, panels have ruled that the
principles of sustainable development should be used to inform
both the reading of WTO commitments of members and WTO rules (e.g.
US/Gasoline, which ruled that clean air was a potentially exhaustible
resource and therefore that measures to stop pollution were permissible
under WTO rules). Other cases have affirmed the precautionary
principle can be used to ban imports considered to pose a risk
(EU-Hormones), and to allow products to be banned on the basis
of the process and production methodology used (US-Shrimp II case,
2001, which was a response to the US banning imports of shrimp
caught in ways that endangered turtles). So it is inaccurate to
suggest that WTO treaties prevent MEAs from operating effectively
or constrain countries from protecting their environment through
legislation.
31. For these reasons, the Government continues
to believe that no new institution is necessary and that the most
effective approach will be to work through the established mechanism
of the CTE (SS) to ensure greater coherence between trade and
environmental law and a more formalised and closer working relationship
between the WTO and the MEAs.
Recommendation 14 (Para 81) We call on the Government
to raise this issue with the EC and other EU Member States, with
a view to the adoption of a policy to ensure interactions between
international organisations can be made more mutually supportive.
32. The Government has an established policy
of encouraging all the multilateral institutions of which it is
a member to pursue reforms which will improve their capabilities
and their ability to co-operate effectively to address key international
challenges. Modern, effective and transparent multilateral institutions
with the capability to act quickly and in collaboration will be
essential to helping countries adapt to the economic, social and
environmental consequences of globalisation. We will continue
to encourage the multilateral institutions to co-operate closely
and to develop mechanisms, such as mutual observership or information
sharing that can facilitate this.
33. With regard to the WTO, this issue was considered
by the Sutherland Report , which considered how links between
the WTO and other multilateral institutions, particularly the
World Bank and IMF, could be strengthened. The report made a number
of specific recommendations. However, at the time the report was
published, WTO members decided to postpone consideration of its
recommendations as the Doha Round negotiations were in progress.
At the present time, we do not think it appropriate to raise the
question of specific reforms within the WTO or within the EU,
although we retain a close interest in developments, and the UK
is prepared to play an active role in any process agreed by WTO
members to consider the recommendations of the Sutherland Report
in this and other areas.
Recommendation 15 (Para 91) Although the Government
acknowledges that there may be some negative environmental consequences
of the Round, we are surprised that it does not appear to be more
concerned. WTO Members have failed to consider adequately the
environmental impacts of the negotiations, making it likely at
this stage that the legacy of a completed Round will include a
loss of biodiversity and increased greenhouse gas emissions. We
urge strongly the Government and EC to pursue aggressively a more
sustainable outcome. Failure to address these issues will give
the lie to the EU and UK Government assertions that they are at
the forefront of action on climate change and sustainable development.
34. The Government is very concerned about potential
negative environmental consequences of the Round, and for this
reason has fully supported the EC's SIA process, which seeks to
identify such consequences, and capacity building programmes,
to address them. The EC was instrumental in incorporating environmental
considerations into the Doha mandate and has been one of the most
proactive delegations in pushing forward this agenda. At the
same time, we must recognise the positions of other delegations
and the need to reach a conclusion to the Doha Round that is acceptable
to all WTO members.
Recommendation 16 (Para 96) The EU has displayed
a lack of political will to address sustainability issues by,
for example, failing to remove agricultural market distorting
measures within the EU. Until the EU has the political will to
ensure that our negotiation positions are fully consistent with
sustainable development objectives, we cannot expect other WTO
Members to take these issues seriously. The UK Government and
the EU must demonstrate clear leadership on this, even when it
may be against our short-term economic interests to do so.
35. The Government does not agree that the EU
has shown a lack of political will to address sustainability issues.
Both the UK and the EU remain fully committed to securing an
ambitious, pro-development outcome to the DDA negotiations. The
UK Government believes that in order to reach a final DDA agreement,
the EU will have to reduce agricultural market distorting measures
within the EU and allow greater agricultural market access to
the EU. We believe that this will help achieve a balanced and
sustainable outcome to the DDA. However, other EU Member States
and WTO members have different views of what constitutes a balanced
and sustainable outcome. We need to recognise the difficult position
of the EC in reaching a position that balances these views within
the EU and one which forms part of an agreement with the wider
WTO membership. The UK is working closely with the EC and other
Member States to deliver this.
36. The UK Government vision for the Common Agricultural
Policy (CAP) is to ensure the competitiveness and market-orientation
of the European agriculture sector, which is not subsidised in
ways that distort international trade, but subsidises wider public
goods, for example environmental protection. The DDA is aiming
to significantly reduce trade-distortion in agriculture. Some
progress has already been made, for example agreement was reached
at the Hong Kong Ministerial meeting in December 2005 to end agricultural
export subsidies by 2013 (contingent on a final balanced DDA deal).
37. The EC has already taken, and will continue
to take, steps to reform the structure of its agricultural subsidies
to make these more sustainable and less trade-distorting. Within
the EU this has largely been achieved through decoupling, the
ending of the link between production and subsidy payments, whilst
allowing payments which deliver public goods such as environmental
benefits. Once fully implemented, these reforms should achieve
a better equilibrium between supply and demand in both the EU
and the global agricultural markets, reducing overproduction and
artificial price distortion, as well as the practice of dumping
surplus agricultural products on world markets. The UK Government
has consistently supported this reform process, and will continue
to do so.
Recommendation 17 (Para 99) We commend the Government
for pushing for more action to reduce agricultural tariffs and
quotas. Although the EU and the US have sought to address this
imbalance in international trade, they have not gone far enough.
As it is widely held by WTO Members that agriculture can help
raise people out of poverty, it is very disappointing that more
has not been offered by the EU and US. A lack of movement on these
key issues has now, in part, caused the suspension of these negotiations.
The UK Government should do its utmost to ensure that the Round
does not fail in its stated development aims, and do more to fight
for the interests of the poorest people. This not only means that
the Government should work to improve the EU offer, but should
also use our special relationship to seek to ensure that the US
goes much further.
38. The Government remains committed to doing
all we can to secure an ambitious, pro-development outcome for
the DDA. We share the disappointment that a deal has not yet
been reached, and would like to see further progress on the reduction
of agricultural tariffs and quotas in particular.
39. The group of Least Developed Countries already
has 100% Duty-Free Quota-Free access to EU markets, except for
arms and ammunition, sugar and rice (the latter two have quotas,
which are due to be phased out by 2009). The WTO Hong Kong Ministerial
Conference in December 2005 provisionally agreed a minimum of
97% duty-free quota-free access to all developed markets, as part
of a final Doha deal. We continue to discuss with all our partners
to ensure this offer can be both confirmed and improved.
Recommendation 18 (Para 105) As it is now known
that liberalisation in the agricultural sector may have serious
consequences for some developing countries, it is paramount that
the G33 proposals to protect developing country agriculture are
taken seriously. This is needed to ensure that the Doha Development
Round can truly lead to gains for the poorest countries. We are
convinced that a level of special and differential treatment must
be granted to developing countries in agricultural products in
order to prevent the most vulnerable in these countries from being
devastated by trade liberalisation.
40. Special and Differential Treatment (S&DT)
measures are a key part of the Doha negotiations. They aim to
enable developing countries, especially small and vulnerable economies,
to integrate gradually and sustainably into the global trading
system.
41. The Government strongly supports agreement
of robust Special and Differential Treatment measures in the Doha
negotiations. These measures should be designed so that they are
flexible, enabling developing countries to adapt them according
to need. Both EC and UK officials discuss these measures regularly
with G33 and other interested partners.
42. Needs vary under different parts of the Doha
negotiations, so measures should be tailored accordingly. Given
the aim of integration into the global trading system, they should
not lead to wholesale and long-term exemptions that could lead
to a two-tier or multi-tied system. A good example is found in
Article 10 of the Uruguay Round Sanitary and Phytosanitary Agreement,
which allows for the phased introduction of new sanitary or phytosanitary
measures and longer timeframes for compliance on products of interest
to developing country members, so as to maintain opportunities
for their exports.
43. DFID has funded a range of work on operationalising
Special and Differential Treatment concepts, including work to
propose possible indicators for identifying Special Products in
agriculture negotiations, and support for dissemination of the
results. Special Products classification enables countries to
specify particular products for protection from immediate international
competition. Further support will be considered.
Recommendation 19 (Para 105) The Government and
EC must actively engage with the G33 proposals and urge those
resistant to it to change their stance. Failure to do this could
lead to the completion of a Round which exacerbates poverty and
is therefore likely to accelerate environmental damage. Such an
outcome could be considered a fundamental betrayal of the poorest
people on Earth.
44. We refer the Committee to our response to
recommendation 18.
Recommendation 20 (Para 107) Although Aid for
Trade will greatly assist poor countries in developing their capacity
for trade, this does not preclude the need for some of the poorest
countries to be able to protect their agricultural sector, or
to ease slowly into the global market.
45. We refer the Committee to our response to
recommendation 18.
Recommendation 21 (Para 110) We welcome the
statement in the Aid for Trade recommendations that it should
take full account of sustainable development goals. However we
are concerned that there is little in the way of specific examples
of how the programme will indeed be made sustainable. The EC and
UK Government should make strongly the case for the inclusion
of a specific commitment to the strengthening of domestic capacity
in environmental analysis, regulation and enforcement in developing
countries. This is required to help avoid environmental degradation
being an outcome of the programme.
46. We agree that strengthened environmental
analysis, regulation and enforcement is required in developing
countries, as part of the Aid for Trade package, to help avoid
environmental degradation being an outcome of increased and improved
trade. As far back as November 2001, the Doha Ministerial meeting
recognised, "the importance of technical assistance and capacity
building in the field of trade and environment to developing countries,
in particular the least-developed among them".
47. Aid for Trade is in its early stages. The
WTO Director General, Pascal Lamy, is in the process of forming
a Consultative Group to take forward the recommendations of the
Aid for Trade Task Force. The Consultative Group will operationalise
those recommendations and the UK is encouraging the Group to take
full account of sustainable development goals.
48. Both the EAC report and the Aid for Trade
Task Force recommendations note the importance of the Paris Declaration
on Aid Effectiveness and the commitment to apply environmental
assessments and strengthen environmental capacity. This commitment
is echoed in the 2006 White Paper on International Development
(page 67), which commits the UK to, "help partner countries
identify and respond to environmental opportunities and risks,
for example by helping them to undertake strategic environmental
assessments". The challenge therefore is to strengthen work
on governance, growth, trade and country-driven planning so that
it can also achieve pro-poor environmental management. There are
several good examples of how UK and international support can
be used to support environmental objectives:
- In 2005 the G8 committed to supporting improvements
to climate observation networks in Africa to address gaps in climate
data. This will be supported by developing the ability to analyse
and use that data so relevant national and sectoral plans and
action can be properly informed.
- DFID is helping develop 'environmental wealth
diagnostics' and similar tools to ensure that Poverty Reduction
Strategies (PRSs) and national development processes are informed
of environmental opportunities and sensitivities. DFID has already
reviewed how environmental issues have been included in four PRSs.
- In Ghana, DFID helped to launch the strategic
environmental assessment of the first PRS. DFID is now providing
technical support to enhance the capacity of the government body
responsible for drafting the new PRS.
- In Tanzania, DFID and UNDP helped the government
develop its ability to address poverty and environment links in
its growth and poverty reduction strategy. Assistance included
developing poverty-environment indicators as part of the strategy's
poverty monitoring system, working with the Vice President's Office,
and with local stakeholders.
- DFID has been working with the OECD-DAC and several
multilateral financial institutions to develop a joint approach
to strategic environmental assessment, which enables the environmental
implications of policies and programmes to be assessed and managed.
Recommendation 22 (Para 116) It is essential
that relevant MEA secretariats are granted observer status on
the WTO Agriculture Committee. MEA secretariats must also be able
to contribute effectively to the negotiations, to ensure more
effective consideration of the environment in its deliberations.
49. The Government believes that it may be helpful
for MEA secretariats to be granted observer status on the WTO
Agriculture Committee. The Government recognises that it would
be beneficial for MEA secretariats to work with all WTO members
to ensure proper consideration of the environment in agriculture
deliberations.
Recommendation 23 (Para 117) Seeking to integrate
environmental concerns more fully into WTO agricultural negotiations
will seem like hypocrisy if we do not fully integrate this issue
into all UK policies. The fact that policy documents are still
produced by UK Government departments which fail adequately to
account for the environment makes it harder to argue a case for
more sustainable practices in the WTO. It also raises questions
as to the Government's commitment to sustainable development in
practice.
50. The Government is committed to ensuring that
the principles of sustainable development, including the potential
impact of policies on the environment, are incorporated into policy
making.
Recommendation 24 (Para 124) In the short-term,
dealing with the question of food miles and the impact of increased
global trade on climate change is too thorny an issue for the
WTO. The Government should act to remove the most egregious of
imbalances in the international trade regime as part of a longer
process to start dealing with climate change through the WTO.
51. The Government is aiming for an ambitious
and pro-development outcome to the Doha Round and has been working
closely with the EC and other partners to achieve this. As the
evidence to the Committee on this issue revealed, the relationship
between increased global trade and its potential impact on climate
change is complex and one on which we are gathering further information
to inform policy development.
Recommendation 25 (Para 125) As other Members
of the WTO are unwilling to deal with climate change in the short-term,
and given its pressing nature, the UK Government and the EU must
themselves do much more to tackle emissions from international
transport. In line with our previous reports, we recommend that
transport emissions be better accounted for through, for example,
taxation of aircraft fuel, the robust inclusion of aviation in
the EU emissions trading scheme and the reduction of emissions
from shipping at European ports. The Government should also explore
the potential to help tackle this issue through consumer awareness
programmes linked to labelling of country of origin. Eventually
we consider it necessary to ensure that all the external costs
of products are internalised in their final price.
52. The Government agrees that reducing emissions
from transport is essential to tackling the problem of climate
change. The Government supports the inclusion of the aviation
sector in the EU Emissions Trading Scheme (EU ETS), and welcomed
the EC's publication of a legislative proposal to include aviation
in the EU ETS in December 2006.
53. The EU ETS sets an overall cap on carbon
emissions and clear targets for business sectors. Participants
are allocated or have to buy tradable emissions allowances. This
enables the market to determine the best way to make reductions
in emissions that contribute to climate change. Businesses that
emit less carbon dioxide than their allocation are able to sell
allowances on the carbon market to businesses that need to buy
allowances to cover extra emissions. This approach will allow
the environmental costs of aviation to be covered through a mixture
of emissions reductions within the sector and purchase of reductions
that can be produced more cheaply and easily by other sectors.
The advantage of emissions trading is that in an industry with
minimal abatement options, such as aviation, it guarantees a specific
environmental outcome in a way that other instruments do not.
It also ensures that the emissions reductions required to achieve
a particular environmental outcome take place in as cost-effective
a manner as possible.
54. The current EC proposal would expand the
ETS to include all internal EU flights from 2011, extending to
all flights arriving at or departing from EU airports from 2012.
It also aims to tackle the nitrogen oxide effects of aviation
through a proposal published by the end of 2008. The Government
does, however, also recognise that trading may not provide a total
solution. In view of this, we will continue to explore and discuss
the options for the use of other economic instruments for tackling
aviation's climate change impact.
55. We recognise that the exemption of aviation
from fuel tax is anomalous, but this exemption stems from International
Civil Aviation Organisation (ICAO) policy and hundreds of bilateral
air services treaties that cannot be unilaterally amended. At
the last ICAO Assembly, European members succeeded in getting
recognition for the first time that policy on the exemption of
aviation fuel from taxation has been called into question in some
states that impose taxes on other forms of transport modes and
sources of greenhouse gases. However, the great majority of ICAO's
member states still oppose any change. Without international consensus
on fuel taxation, a unilateral approach would not be effective
as market and environmental distortions could result. For example,
carriers could purchase fuel in other countries and carry the
additional payload to avoid paying duty (and increase emissions).
56. The success of land based emissions trading
schemes raises the possibility of developing an appropriate market
based approach to reduce atmospheric emissions from ships. Developing
an appropriate emissions trading scheme to incorporate the globally
mobile shipping industry will require input from all stakeholders.
A successful emissions trading scheme for shipping will need to
incorporate as a minimum the following critical components:
- Measurement and verification of emissions
- Trading rules
- Enforcement
- Administration of the scheme
57. The complexity and variability of the shipping
industry adds to the size of this task, but experience in other
industries suggests that the benefits available from implementing
an emissions trading scheme are worth this investment.
58. The ratification of International Maritime
Organisation (IMO) MARPOL Annex VI (the international convention
for preventing pollution from ships) ensures that the first international
legislation restricting atmospheric emissions from shipping activity
comes into effect. Additional regional legislation was passed
by the European Parliament in April 2005, also enforcing the reduction
of sulphur oxide from ships. Both regulations encourage the development
of pollutant abatement technologies to reduce emissions, as an
alternative to the use of lower sulphur fuel while inside the
Sulphur Emissions Control Areas (SECAs).
59. In existing trading schemes, emission reductions
are generated by actions such as installing more advanced pollution
control technology or switching to cleaner fuels. IMO MARPOL Annex
VI allows the use of onboard technology as a method of reducing
sulphur oxides (exhaust gas scrubbing for example) and nitrous
oxides (selective catalytic reduction or humid air motors for
example) to comply with the requirement for reduced emissions.
Such technologies have the potential to significantly reduce emissions
well below the legislative limits, and could provide the basis
for developing emissions trading schemes for shipping.
60. The benefits that may be achieved by the
use of market mechanisms for shipping has been reviewed in a report
commissioned by the EC and undertaken by NERA Consulting. In its
recommendations, the 2004 NERA report notes that further work
is necessary to develop the details of appropriate schemes, and
suggests that three approaches to emission trading be investigated;
voluntary port dues differentiation, offsetting and credit based
schemes.
61. The EU ETS Directive lists transport as one
of the sectors that should be considered when assessing whether
to expand the scheme in its current review. We therefore feel
that it is appropriate for the EC to start a serious debate now
around the potential inclusion of surface transport and for further
work to be carried out as part of this process. Emissions trading
in the surface transport sector could potentially be a cost-effective
way for the transport sector to reduce its climate change impact.
However, it will be important to take account of how emissions
trading might work alongside other important policy measures at
our disposal for reducing greenhouse gas emissions from the transport
sector, such as biofuels obligations, tailpipe emissions targets
and consumer information. The best way to tackle transport emissions
is likely to be a combination of a number of such measures. It
will also be necessary to look at the potential impact on carbon
price, fuel price and industrial competitiveness of including
surface transport in the EU ETS.
62. Country of origin labelling is unlikely to
be a robust indicator of emissions associated with transport.
For example, shipping is very efficient whereas airfreight has
the highest green house gas emissions on transportation method.
Production method is also a factor; some goods can be produced
in developing countries using less carbon than the often carbon-intensive
methods used in developed countries. Research suggests that some
flowers flown in from Africa, for example, use less energy overall
than the same flowers produced in Europe because they are not
grown in heated greenhouses. The issue is also complicated by
other environmental considerations such as use of water and pesticides.
A scheme labelling products purely on the basis of country of
origin could therefore be very misleading.
Recommendation 26 (Para 132) We believe that
in the short term there is a case for the liberalisation of environmental
goods and services, although we are sceptical as to the extent
to which any agreed list produced could be considered sustainable.
Key to this whole debate is ensuring that the goods and services
listed are relevant to developing countries. There may also need
to be flanking measures adopted so that developing countries will
not be negatively affected.
63. The Government is committed to working towards
an ambitious pro-development outcome to the DDA, including in
the negotiations on the environment dossier. We believe that significant
liberalisation in the trade in environmental goods and services
will bring benefits to developing countries, many of which face
significant environmental challenges. Liberalising environmental
markets will increase the speed of diffusion of technologies that
remove pollutants or low levels of carbon and other greenhouse
gases, as well as creating economic opportunities for developing
countries, for example through developing markets for biofuels.
64. We agree with the Committee that it is important
to ensure that the goods and services listed are relevant to developing
countries. The EC list which has been submitted to the CTE(SS)
has specifically attempted to include products of export interest
to developing countries.
65. The importance of liberalising trade in environmental
goods and services was highlighted by the Stern Report on climate
change, which identified the need to harness market forces in
order to create a global price for carbon and a global market
for low carbon technologies, as well as incentivising investment
in these technologies.
Recommendation 27 (Para 132) Ultimately we feel
that there must be a much tighter linkage between trade policy
and sustainable development. The Government should initiate a
debate on whether it would be possible to develop a more sustainable
global trade system. This could focus on the formulation of sustainability
indicators by which to classify different products or services.
Classifications could then be used to lead more sustainable trade
through labelling schemes, or more directly through tariffs on
the basis of sustainability. We accept that these issues are challenging,
but the Government must start to look for more long-term solutions
to environment-trade problems.
66. As mentioned in our initial submission to
the Committee, the principle of sustainable development is embodied
in the first paragraph of the treaty establishing the WTO. The
Government also believes that the WTO has taken many steps to
ensure that international trade rules are established on a sustainable
basis and contribute to the broad objective of sustainable global
economic growth. The development focus of the Doha Round, and
the inclusion of the environment for the first time in these negotiations
with an ambitious mandate are evidence of this; much would be
achieved through a successful conclusion of the DDA. Environmental
issues have also been considered in a number of cases brought
to the WTO's Dispute Settlement Understanding, and the judgements
made in a number of cases (e.g. those cited in our response to
recommendation 13) indicate the importance the WTO attaches to
the concept of sustainable development.
67. We accept, however, that there is more that
could be done to build closer links between trade and sustainable
development. The Government is working to improve the evidence
base on sustainable production and consumption. We are developing
roadmaps for ten products, to assess their lifecycle impacts.
This evidence will inform the development of interventions (short-,
medium- and long-term) to help transform the product (or market)
towards a more sustainable future
68. The development of sustainability indicators
and the use of these to develop labelling schemes would pose a
range of difficulties. Firstly, this is an issue that would require
international agreement, at a minimum within the EU, but possibly
within the WTO, on what indicators should be used, to which products
they should be applied and what information would need to be included
in the labelling. Gaining agreement on these issues would be likely
to be very difficult in practice. There is also the question of
how such a set of indicators would fit with, and what they would
add to existing mandatory EU labelling rules and voluntary labelling
schemes such as Fairtrade or for organic farming. There is also
the question of how such a scheme and consequent regulatory or
non-tariff barriers to trade would affect developing countries,
and whether imposing additional barriers would be consistent with
our broad development objectives. Previous experience suggests
that increasing trade barriers is not the answer, and that trade
liberalisation complemented by flanking measures offers the most
sustainable outcome over the long term.
Recommendation 28 (Para 135) The fact that the
EU has adopted a stance against the liberalisation of natural
resources in order to avoid negative environmental impacts is
very positive and we commend the UK Government and EU for this.
69. The Government welcomes the Committee's support
for the EU and UK position.
Recommendation 29 (Para 137) We are heartened
that the revised EU Sustainable Development Strategy includes
a commitment to incorporate the principles of sustainable development
into its international trade policy. It is essential that these
do not become empty words and that they are actually translated
into concrete action.
70. The Government and the EU are committed to
ensuring that the commitments in the EU Sustainable Development
Strategy to incorporating the principles of sustainable development
into its international trade policy are realised. Within the
WTO negotiations, the EC has been active in promoting the sustainable
development agenda, and the EU Trade Commissioner, Peter Mandelson,
reaffirmed this commitment in a recent speech . In the same speech
Mandelson also underlined that the EC would be pursuing the same
sustainable development agenda in any new FTAs it makes.
Recommendation 30 (Para 138) We fear that there
is still a lack of consideration of sustainable development issues
in some EU negotiating positions and call on the Government and
EU to urgently reassess our positions to ensure that they are
fully compatible with the revised Sustainable Development Strategy.
71. The EU has committed to integrating sustainable
development principles into its negotiating positions, and the
Trade SIAs are a significant tool in working towards this objective.
The Government supports this approach. Whilst the negotiating
mandates and Council directives set the broad framework for EC
negotiators in the DDA and other trade negotiations, EC negotiating
positions are continuously reassessed and adjusted in the light
of developments in the course of trade negotiations, and in consultation
with EU Member States. This offers the opportunity to review the
EC's negotiating positions, and to ensure that these are consistent
with wider sustainable development objectives, including those
of the Sustainable Development Strategy. The Government will continue
to take a close interest in this issue and in ensuring that a
final DDA outcome is consistent with the principles of sustainable
development.
Recommendation 31 (Para 140) We reluctantly accept
that there will be occasions when the economic or development
benefits of a policy will mean that it is adopted, even where
there will be negative environmental impacts. It is therefore
imperative that adequate emphasis is placed on the need to adopt
flanking measures to mitigate negative environmental impacts.
Indeed, without the use of effective flanking measures, it is
unlikely that trade liberalisation can be sustainable. The significance
of such measures makes it extremely important that their effectiveness
is evaluated following adoption.
72. The Trade Sustainability Impact Assessment
Stocktaking Conference, which was hosted by the EC in March 2005
identified more effective use of flanking measures as an area
where further action was needed. Following the conference, the
EC undertook to consider whether it would be possible to make
funds available to assist with this. At UK level, we have commissioned
some ex post research to assess the effectiveness of flanking
measures already in place. The research includes case studies
of three developing countries and is due for completion in March
2007. Once complete, we will share the conclusions with other
EU Member States and make them publicly available.
Recommendation 32 (Para 144) We greatly welcome
the use of SIAs in trade negotiations. Nevertheless we are concerned
that its full findings are not being incorporated into our negotiating
positions. Given that the EU SIA anticipates that the outcome
of Doha will be negative for the global environment, and will
have variable social benefits, the EU could fail in its commitments
to more sustainable trade. It is paramount that the principles
established in the Sustainable Development Strategy, and the recommendations
highlighted in the SIA, are brought into Doha to ensure a more
sustainable outcome. This may involve a change of negotiating
stances where possible, such as on agricultural subsidies, or
the full implementation of an effective range of flanking measures
to offset any negative impacts.
73. The UK strongly supports the use of Sustainability
Impact Assessments (SIAs), designed to analyse the social and
environmental impact of any potential trade agreement and feed
in to final negotiations, and fully recognises they have an overall
positive impact. This is an important means to ensure sustainable
development is appropriately reflected in the overall DDA outcome.
We agree with the Committee's view that the findings of SIAs could
be better integrated into the policy making process. We therefore
welcomed the Commission's stocktaking conference in March where
this was discussed as one of the key issues, and fully support
the Commission's intention to explore ways of improving their
integration.
Recommendation 33 (Para 146 ) We are concerned
that in what could have been the end stages of the Doha Round,
the EU's primary method for ensuring that trade agreements will
be sustainable, SIAs, could be described as a work in progress.
It is of utmost importance that our trade policies are sustainable
and we therefore urge the Government to ensure that the effectiveness
of the SIA process is fit for purpose by calling for its complete
reassessment.
74. We acknowledge the Committee's concern regarding
the current effectiveness of trade SIAs. The Government, along
with other Member States, are working together to ensure there
is continual improvement in the process. It has been fully accepted
by the Commission that issues such as the timing of a trade SIA
and increased involvement of developing countries need to be addressed.
However, it must be recognised that SIAs have been hugely beneficial
and have influenced the EU's negotiating position.
75. The Commission has committed to carrying
out SIAs on any new FTAs. This will be an opportunity to address
some of the problems that have been hitherto identified in the
SIA process.
Recommendation 34 (Para 150) Although we are
concerned at the shift of emphasis onto bilateral and regional
trade agreements from the WTO and the multilateral trading system,
we do believe that these provide a unique opportunity for the
UK Government and EU to demonstrate its commitment to sustainable
development, particularly in the short term. We should pursue
innovative agreements that seek to address global environmental
challenges through trade, such as free trade in energy efficient
goods.
76. The Government shares the Committee's view
that achieving a successful outcome to the DDA and supporting
the WTO and the multilateral trading system must remain the first
priority of the EU's trade policy. FTAs must act as building blocks
towards future multilateral negotiations, and not undermine the
WTO. This view is shared by the EC, which stated that "The
world needs a strong multilateral trading system. It is the most
effective means of expanding and managing trade for the benefit
of all…there will be no European retreat from multilateralism"
. For this reason, the UK and the EC welcomed the agreement of
the WTO General Council on 14 December 2006 to implement a new
transparency mechanism for FTAs until the Committee on Regional
Trade Agreements has had time to complete its review of the existing
rules on FTAs (set out in Article XXIV of the GATT and Article
V of GATS), which may lead to a further revision of the rules
as part of a final DDA agreement. The UK and EC will continue
to follow this review closely.
77. However, as the Committee recognises, the
new FTAs with India, South Korea, the ASEAN countries that the
EC has requested negotiating mandates for, as well as potential
future agreements with the Community of Andean Nations and Central
American Common Market countries, offer an opportunity to advance
the objective of sustainable development. The Government has urged
the EC to ensure that the environmental and developmental implications
of the new FTAs are considered in parallel with the economic benefits
of an agreement. We are confident that the approach set out in
the recent EC Communication Global Europe: Competing in the World,
embodies these principles and will ensure that new FTAs facilitate
sustainable development.
"In considering new FTAs, we will need to work
to strengthen sustainable development through our bilateral trade
relations. This could include incorporating new co-operative provisions
in areas relating to labour standards and environmental protection.
We will also take into account the development needs of our partners
and the potential impact of any agreement on other developing
countries, in particular the potential effects on poor countries'
preferential access top EU markets. The possible impact on development
should be included as part of the overall impact assessment that
will be conducted before deciding to launch FTA negotiations.
In line with our position in the WTO, we will encourage our FTA
partners to facilitate access by least developed countries to
their market, if possible by granting duty and quota free access".
78. The EC is currently consulting on the text
of the negotiating directives for the FTAs with India, South Korea
and the ASEAN countries. The Government has already emphasised
the importance of pursuing a high level of ambition with regard
to sustainable development; the Commission and other EU Member
States also support this objective. We will continue to press
for this, and to support this Commission in this aspect of the
subsequent FTA negotiations.
Recommendation 35 (Para 151) Should agreement
be reached on the Doha Round, we believe that the WTO, and the
international trade system itself, will be ripe for an urgent
reassessment with regards to its interaction with the environment
and sustainable development. The current system must be improved
to make it better equipped to deal with the wide-ranging environmental
and development consequences of international trade.
79. As set out in our responses to recommendations
12-14, the Government continues to believe that it is unnecessary
to create new institutions or to seek radical changes to existing
mechanisms, which have worked effectively, and have the confidence
of the international community. In addition, we do not believe
that an international consensus exists on the need for radical
WTO reform. The challenge is to ensure that all multilateral institutions,
including the WTO and the MEAs, improve their capabilities and
coherence to enable them to respond effectively to globalisation.
The Government is committed to taking this work forward across
all the multilateral institutions to achieve this, although the
particular circumstances of each institution and the external
environment in which it operates must be taken into account in
pursuing this work.
Recommendation 36 (Para 152) The Government and
the EC should now focus its efforts on getting the Doha Round
restarted, with the ultimate goal being to achieve a pro-poor,
environmentally sustainable conclusion. Anything less than this
will means that the developed world will have reneged on its commitment
to making international trade work for, and not against, those
people who need it most.
80. Achieving an ambitious, pro-development outcome
to the DDA remains the top priority of both the Government and
the EC. We welcomed the resumption of informal negotiations in
Geneva in November 2006, and continue to work within the EU and
with other WTO members to ensure that these negotiations make
progress towards a final agreement that delivers real liberalisation
in global markets and benefits for developing countries.
81. The Government remains committed to ensuring
progress on issues outside the Single Undertaking of the DDA,
such as Aid for Trade. Aid for Trade builds on the commitments
made by the G8 at Gleneagles in 2005 and reiterated at St Petersburg
in 2006. G8 and WTO members have a responsibility to fulfil those
promises. The Government welcomed the adoption of the recommendations
of the Aid for Trade Task Force by the WTO General Council on
10 October 2006, and continues to press for these to be implemented,
within the EU and bilaterally with non-EU nations. The UK has
pressed for a commitment from the EC to take forward the negotiations
on Aid for Trade and to take forward work on other areas of importance
to developing countries, such as the EU's implementation of 100%
DFQF access for Least Developed Countries by 2008. We are pleased
that the EC has committed itself to doing this.
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