Trade and Environment Review 2006: Environmental Requirements and Market Access for Developing Countries: Developing pro-Active Approaches and Strategies

As multilateral, regional and bilateral trade negotiations on trade liberalization result in further tariff reductions, discussions on market access are increasingly focusing on the growing use of non-tariff measures, including environmental requirements. Some analysts and policy-makers believe environmental and related health requirements (ERHRs) are long overdue to counter unsustainable trends in production and consumption; others warn that such requirements run the risk of being turned into a new form of versatile non-tariff barrier (NTB) that could hamper developing country exports. One key question therefore is how to foster environmental, not trade, protection. Another important question is: How can developing countries benefit from consumer preferences for environmentally preferable products? Against this background, this Trade and Environment Review analyses the relationship between environmental requirements and market access for developing countries. The first two chapters attempt to conceptualize the key issues at stake, provide practical information and identify possible actions, at the national and multilateral levels, that could assist developing countries in strengthening their capacities to respond to emerging ERHRs and take advantage of new opportunities. The Review also attempts to respond to the need for more sector-specific analysis. Chapter 2, for instance, analyses adjustment strategies in developing countries to new environmental requirements for electrical and electronic equipment in international markets. This is a very dynamic export sector in which some Asian developing countries are major global suppliers. The adjustment strategies also need to address problems related to the growing domestically generated waste from electrical and electronic equipment. Chapter 3 discusses market opportunities for environmentally preferable products that may result from new ERHRs, with special emphasis on organic agricultural exports from developing countries. Although the theme of environmental requirements and market access for developing countries is not part of the current WTO negations as provide in paragraph 32(i) of the Doha Ministerial Declaration, it is an important part of the Doha work programme and is included in the NTB-related negotiations on Non-Agricultural Market Access (NAMA). It is also an area in which UNCTAD has been particularly active through all three pillars of its work - consensus building through intergovernmental deliberations, policy analysis and technical cooperation/capacity building (TC/CB). One of the outcomes of the UNCTAD XI process has been the launching of a Consultative Task Force on Environmental Requirements and Market Access for Developing Countries (CTF) as a project-based activity. The conceptual background to and possible ways in which the CTF could assist developing countries in reducing potentially negative impacts of new ERHRs on market access and in harnessing development and trade opportunities that might arise from such requirements are discussed extensively in this Review.