The author argues in favour of establishing international rules that will provide a meaningful framework for ‘bona fide’ food aid.

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The Commerce investigation had been launched in response to a complaint from the Coalition for American Solar Manufacturing (CASM), a group of seven solar panel manufacturers led by SolarWorld Industries America that had together petitioned the US to investigate Chinese solar imports last October. (See Bridges Weekly, 9 November 2011)

The seven-company coalition had argued that Chinese companies were deliberately selling products abroad at below-market prices, a practice known as dumping.

In last Thursday’s preliminary determination, the US agency found that Chinese producers/exporters sold solar cells in the United States at prices that were between 31.14 and 249.96 percent lower than their normal price.

As a consequence, the majority of Chinese exporters/producers will face a cumulative duty around 250 percent to account for this price difference. Sixty-one exporters will be subjected to anti-dumping duties of roughly 31 percent.

The announcement quickly prompted outcry from Chinese government officials, who deemed the Commerce Department decision to be “unfair.”

“By deliberately provoking trade friction in the clean energy sector, the United States is sending the world a negative signal about trade protectionism,” Shen Danyang, a spokesman for the Chinese Ministry of Commerce (MOFCOM), said. MOFCOM has not yet outlined how it will respond.

According to calculations by Bloomberg New Energy Finance, the US decision will effectively raise the price of Chinese-made panels to US$1.11 per watt, making them 17 percent more expensive than their non-Chinese counterparts.

The duties announced last week do not immediately go into effect; rather, they must be confirmed both by Commerce and the US International Trade Commission this fall. If the final determinations are affirmative, the US may enforce the duties from 19 November onwards, as well as retroactively for 90 days.

Rift intensifies within US solar industry

The case has divided the US solar industry, pitting solar panel manufacturers against companies that purchase these panels for use in solar energy projects.

For his part, Gordon Brinser, president of SolarWorld Industries America and the leader of the Coalition for Solar Manufacturing, praised the decision.

“Commerce’s careful measures could help thwart China’s illegal drive to control the solar market and supplant manufacturers and jobs in America,” he said.

Meanwhile, the Coalition for Affordable Solar Energy (CASE) - a coalition of over 100 US firms that formally opposed the CASM case - continues tocampaign against the anti-dumping duties, insisting that an increase in the price of solar panels will lead to a fall in the number of service-related jobs that make up a large part of the US solar industry.

“Today SolarWorld received one of its biggest subsidies yet - an average 31 percent tax on its competitors,” Jigar Shah, president of CASE, said. “What’s worse, it will ultimately come right out of the paychecks of American solar workers.”

Final decision on countervailing duties forthcoming

In the same complaint, the CASM had also alleged that Chinese companies had received unfair government support; with regards to this second claim, the Commerce Department tentatively announced in March that it would indeed be imposing anti-subsidy, or countervailing, duties against Chinese manufacturers (see Bridges Weekly, 21 March 2012). Final determinations regarding the countervailing duties are expected by late July.

However, the legitimacy of these countervailing duties could soon be thrown into question, given an ongoing controversy over whether the Commerce Department can indeed apply these duties against imports from non-market economies (NMEs), such as China.

Earlier this year, Washington enacted a law aimed at preserving Commerce’s ability to impose countervailing duties on NMEs after the US Court of International Trade had denied this possibility in 2011. (See Bridges Weekly, 7 March 2012) However, the new law was later challenged on constitutional grounds, and has now been sent back to the Court of International Trade for review.

The case is closely tied to the issue of “double remedies” - in other words, the case where cumulatively applied countervailing and anti-dumping duties remedy the same governmental support. Double remedies could potentially occur in the current solar spat.

Proposal for US local content requirement

Additional legislation targeting Chinese solar panels could soon hit the floor of the US Congress, following the announcement last week of a proposal that would bar foreign-made solar panels from qualifying for a 30 percent tax credit.

The proposal, authored by US Senators Charles E. Schumer and Sherrod Brown - both Democrats - would see the addition of a requirement whereby 70 percent of the parts of the solar panel would need to be made in the US in order to qualify for the tax credit. Should the final point of manufacture be the US, however, then only 50 percent of the parts would need to be US-made.

“This hard-hitting plan will level the playing field for US solar producers so that they can compete, create jobs and become a global leader in this rapidly-growing industry,” Schumer explained.

ICTSD reporting; “WTO dispute strains the limits of friendship and fair trade,” PV MAGAZINE, 21 May 2012; “US ruling on solar panels ‘unreasonable’,” CHINA DAILY, 19 May 2012; “Solarworld to Lodge China Dumping Complaint In Europe Mid-Year,” BLOOMBERG, 18 May 2012; “US Solar Tariffs on Chinese Cells May Boost Prices,” BLOOMBERG, 18 May 2012; “China ‘caught red-handed’ on US solar anti-dumping charges,” PV MAGAZINE, 18 May 2012.

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US dolphin-safe labelling practices under scrutiny

While the three judges sided with a previous WTO panel in their overall conclusion that the US label is inconsistent with the WTO’s Agreement on Technical Barriers to Trade (TBT), they overruled the earlier report on important points. Both parties had appealed the September 2011 panel ruling, challenging certain issues of law and legal interpretation by the panel. (See Bridges Weekly, 25 January 2012)

According to the three Appellate Body judges, the label discriminates against Mexican tuna by banning a fishing practice known as “purse-seine” nets - encircling nets that temporarily set on dolphins to attract the tuna that swim below - which are used almost exclusively by Mexican fisheries. In other parts of the world, purse-seine nets are of no use, as tuna and dolphin swarms only swim together in the Eastern Pacific. In effect, this means that the majority of Mexican tuna is not eligible for “dolphin-safe” labels, even where independent veterinarians certify that no dolphins were killed or injured during the specific catch.

Mexico’s tuna fleet continues to use purse-seine nets, but is nonetheless compliant with international standards - most notably the Agreement on the International Dolphin Conservation Program (AIDCP). Mexico, the US, and others had negotiated the AIDCP in response to an earlier international trade dispute between the countries over a similar issue.

Unlike the previous panel, the Appellate Body sided with Mexico in finding that the differential treatment affects Mexico’s export competitiveness. The judges further denied Washington’s claim that the differential treatment was exclusively due to a legitimate regulatory requirement.

In relying heavily on the panel’s earlier assessment of marine science, the Appellate Body came to the conclusion that there is no regulatory justification for the label to ban exclusively purse-seine nets and no other fishing practices. In fact, the Appellate Body found that the existing requirements of the US dolphin-safe label are insufficient to address dolphins harmed outside the Eastern Pacific by countries using other fishing techniques.

“The measure at issue does not address adverse effects on dolphins resulting from the use of fishing methods predominantly employed by fishing fleets supplying the United States’ and other countries’ tuna producers,” the judges said in their finding.

While the court ruling only requires the US to bring its labelling practice into compliance, without specifying the conditions, the legal assessment makes clear that cosmetic changes will not be sufficient. Ultimately, the measure will have to apply in an even-handed manner to all fishing techniques and regions.

“Risks to dolphins resulting from fishing methods other than setting on dolphins could only be monitored by imposing a different substantive requirement, i.e. that no dolphins were killed or seriously injured in the sets in which the tuna was caught,” the judges said.

However, Mexico failed to convince the court that the AIDCP qualified as an international standard and thus appropriate benchmark. The TBT Agreement mandates that, where relevant international standards exist, technical regulations must adopt their design. In overruling the panel, the Appellate Body disagreed that the AIDCP was an international standard, criticising that its membership is only open to non-member countries upon invitation.

Labelling policy “mandatory”, though no import pre-condition

Of greater systemic importance is the Appellate Body’s general finding that the measure at issue - the US label, which also does not permit labels that deploy another standard - is a mandatory technical regulation and thus subject to the TBT Agreement. The US had disputed this position, pointing to the fact that eligibility for the label was not an importation or marketing requirement. Instead, Washington maintained, the importance of the label was exclusively the result of consumer preference.

In siding with the panel experts, the judges criticised the US measure for establishing a single and legally mandated definition of the term “dolphin-safe”, whatever context it may be used in. “In doing so, the US measure prescribes in a broad and exhaustive manner the conditions that apply for making any assertion on a tuna product as to its ‘dolphin-safety’, regardless of the manner in which that statement is made,” the ruling concludes, referring to the question of whether the measure is mandatory and voluntary.

The ramifications of this finding for other labels are yet to be seen. But experts immediately point to the dispute of what the term “organic” means and whether organic can include genetically-modified organisms. With another label dispute in the pipeline - an Appellate Body decision in the COOL dispute is set to be released this summer - this year is set to enlighten the critical relationship of trade, market access, and labels.

Further analysis on the US-Tuna II Appellate Body ruling will be made available in next week’s Bridges.

ICTSD reporting.

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Trade issues continue to play a role in international climate change negotiations. Last December’s Durban meet established a permanent forum on so-called “response measures,”  which deal with the social and economic impacts that countries could experience as a result of the policies and measures that other countries take to mitigate climate change. The issue has long been a hot-topic for several countries, given the traditional fears over protectionism and possible future hardships faced by oil-producing countries as renewable energy initiatives ramp-up.

The Bonn mid-year sessions will host the first meetings of the permanent forum, which will be convened by the Chairs of the Subsidiary Bodies. The issue of response measures has been particularly divisive between Annex I and non-Annex I countries, with several developed countries expressing concern that the concept could be used as a loophole for some developing countries to be less accountable for their emissions. The issue is expected to provoke intense debate as parties search for common ground.

The other major trade-related issue to emerge from Durban was the advancement of discussions on the operationalisation of the “Technology Mechanism,” which will play a central role in the development of climate mitigating technology and manage the process of technology exchange from Annex I to non-Annex I (developing) countries. The Mechanism has been one of the few UNFCCC issues that have been noticeably active over the past six months, and that progress is expected to continue in Bonn.

Response Measures

The majority of agenda items for Bonn are expected to focus on establishing an agenda and the negotiating structures required to operationalise the Durban Platform discussions. But while the bulk of issues facing the forum will likely fall under this “structural” umbrella, but sources close to the talks say the ambiguity of some language used in establishing the response measures forum could hold up progress.

According to the deal struck in Durban, the forum has been tasked with implementing the “Work Programme on the Impact of the Implementation of Response Measures,” and consolidating all discussions related to response measures under the UNFCCC.

Sources say there are questions as to whether the Forum will address the structure and function of the Forum itself or also other “related agenda items” - Kyoto Protocol Articles 2.3 and 3.14; UNFCCC Article 4, paragraphs 8 and 9; and UNFCCC Decision 1/CP.10 - which have strong economic and trade implications. The Chairs’ are reportedly expecting to experience difficulty adopting the provisional agenda because Parties will likely disagree on what related items will be discussed under the Forum.

Already this year, the Chairs of the Subsidiary Bodies - the Subsidiary Body for Scientific and Technological Advice (SBSTA) and the Subsidiary Body for Implementation (SBI), who will be convening the Forum - contacted parties asking them for their views on how to conduct the first meeting.

The Chairs asked for input on how to make the meeting “efficient,” “informative,” and “productive” and posed a series of questions regarding the organisational structure of the meeting, agreement on the sequence of issues to be considered, the likelihood of scheduling 2012-2013 workshops, and the financial implications of the work programme. Several parties have reportedly responded to the questions.

The Forum is tentatively set to meet for four 90 minute sessions in Bonn on 17 May, 18 May, 19 May, and 21 May.

Movement expected on Technology Mechanism

Discussions aimed at operationalising the Technology Mechanism will likely see progress over the next two weeks. The goal of the Mechanism - which was agreed upon at COP 16 in Cancun and further fleshed out in Durban - is to enhance action for technology development and transfer in support of climate change mitigation and adaptation. The policy body of the Mechanism - the Technology Executive Committee (TEC) - is already in place and has met twice. However, the Climate Technology Centre and Network (CTCN), the operational arm of the Mechanism, has not yet been established.

Earlier this year, the UNFCCC Secretariat issued a call for applications for prospective hosts for the Climate Technology Centre (CTC), which will steer the Network. In April, three candidates were shortlisted by an evaluation panel comprised of TEC members: a consortium led by the UN Environment Programme (UNEP), the Global Environment Facility (GEF), and Norway’s Det Norske Veritas. Six other proposals from organisations based in China, Costa Rica, Germany, India, Indonesia, and Iran did not make the short list. The panel report which outlines the decision is available here.

The Subsidiary Body for Implementation (SBI) at Bonn is expected to consider the report of the evaluation panel and particularly discuss the selection of the host for the Centre and the constitution of its advisory board. It will then forward a recommendation to the COP in Doha, Qatar for final consideration, which according to the UNFCCC Secretariat, should make the Mechanism fully operational by 2013.

Meanwhile, the Executive Committee agreed on a rolling work plan which sets out its activities for the next two years at its meeting last February (See Bridges Trade BioRes, 7 March 2012). The group’s next meeting is scheduled for 28-29 May - immediately following the meetings of the subsidiary bodies. It will feature a thematic dialogue on enabling environments and barriers to technology development and transfer in which ICTSD, the publisher of BioRes, will participate.

Common but not-so-differentiated responsibility?

The traditional developed-developing country divide is nothing new for international climate change meetings. But many questions are up in the air over how the second phase of the Kyoto Protocol will unfold and how the newly-established Durban Platform will manage the complex issue of Common but Differentiated Responsibility (CBDR), whereby only Annex I countries have quantified emissions reduction obligations.

The notion that developed countries are responsible for the lion’s share of the historical carbon emissions that were produced during their industrialisation process is a centrepiece of the Kyoto Protocol. But with increased emissions from industrial juggernauts like India and China - the latter of which is now the world’s largest polluter - over the past two decades, many developed countries are insisting that the concept be re-defined.

Many developed countries have insisted that the participation of all major emitters is essential to any international climate regime. The United States never ratified Kyoto primarily because of the lack of binding commitments from industrial developing countries and Canada, for its part, withdrew from the Protocol almost immediately after last year’s COP.

Emerging economies, however, are not keen to move away from the advantageous position afforded to them through CBDR. Leaders of the BRICS countries (Brazil, Russia, India, China, and South Africa) earlier this year underscored the fact that they view the principle as central to moving forward on climate change negotiations.

“We welcome the significant outcomes of [COP 17] and are ready to work with the international community to implement its decisions in accordance with the principles of equity and common but differentiated responsibilities and respective capabilities,” the BRICS Summit Delhi Declaration reads.

The Durban Platform, however, makes no mention of CBDR, and negotiations in Bonn will likely give some indication as to how the issue will move forward.

European financial woes

Traditionally the leader of developed country parties in making aggressive climate change commitments, the European Union is struggling with a range of complex internal issues, leading many observers to question whether these difficulties might soon prompt attitude changes from  the 27-country bloc.

Brussels continues to face widespread opposition from both developed and developing countries to its controversial decision to include aviation under its Emissions Trading Scheme (ETS), with India’s environment minister notably calling the move a “deal breaker” for global climate talks.

Europe’s commitment to the Green Climate Fund (GCF) - which aims to channel some US$100 billion annually by 2020 to help developing countries cope with the effects of climate change - was also called into question earlier this month when officials meeting in Bonn failed to commit to financing beyond 2012.

Many developed countries have been criticised for their slow uptake on their GCF commitments and for re-channelling official development aid into the fund. Oxfam, for its part, openly censured Brussels for the short-term commitment.

“At a critical moment in the fight against climate change, Europe looks to be sitting back rather than stepping up,” said Lies Craeynest, Oxfam’s EU climate change expert.

Climate change negotiations have historically been influenced strongly by geopolitical and economic realities. In the wake of major political and economic shakeups across Europe, and with the US rampingup for a general election in November, most observers say to expect no more than the expected in Bonn.

ICTSD Reporting.

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The June 2012 conference - set to be held in Rio de Janeiro, Brazil - marks 20 years since the landmark 1992 United Nations Conference on Environment and Development (UNCED).

With delegates now having had time to come to grips with the expanded ‘zero draft’ document since March’s negotiations, observers had expressed hope that progress would be made during this latest round of talks towards an outcome document that would secure a renewed commitment to sustainable development and help meet new and emerging challenges (see Bridges Weekly, 4 April 2012).

‘Zero draft’ sees little movement towards final version

Considerable efforts were made to bring the ‘zero draft’ outcome document down from 278 to 156 pages by the end of the first week. The second week saw progress slow considerably, with only 21 paragraphs being agreed ad referendum - pending agreement on the final text - by delegates. The remaining 400 paragraphs were left for the next round of ‘informal informals’ later this month.

The co-Chairs of the UNCSD Preparatory Committee - Ambassador John Ashe of Antigua and Barbuda and Ambassador Kim Sook of South Korea - had attempted to reduce and streamline the text by proposing compromise language for many of the more contentious paragraphs, which was referred to as the ‘new Co-Chairs’ suggested text’ (NCST) for the remainder of the negotiations.

The bracketed text covered a wide range of long-standing divisions between delegations over both of the conference’s twin themes: the green economy in the context of sustainable development and eradicating poverty; and the Institutional Framework for Sustainable Development (IFSD).

Along with traditional disagreements between developed and developing countries over existing and future development commitments, debates also continued between a number of developing country delegates over the future of IFSD and what, if any, should be the actionable outcomes of the Rio+20 conference.

At the close of the two weeks, many sides had expressed their frustration at the lack of constructive progress. During the final plenary, the Group of 77 and China (G77/China) grouping particularly emphasised the lack of compromise “from time to time” during the negotiations. According to Reuters, both civil society and private sector observers to the negotiations have criticised delegates for seemingly attempting to water-down some of the key proposals contained in the original ‘zero draft’ document in an attempt to avoid a political flop in Rio de Janeiro.

Delegates given chance for 11th hour agreement on outcome document

In his closing speech to the second round of ‘informal informals’, Sha Zukang - Secretary-General of the UNCSD (Rio+20) - issued a call to action to the delegates present, reminding them of the considerable work that still needs to be done.

He noted that the negotiating process in its current incarnation had failed and that “working methods need to change.”

“Our objective should be to arrive in Rio with at least 90 percent of the text ready,” he said. “The most difficult 10 percent should then be negotiated in Rio with the highest political support.”

During the closing plenary of the second round of ‘informal informals’, Co-Chair Kim spoke to delegates of a meeting which had taken place earlier in the day between the UNCSD Bureau and UN Secretary-General Ban Ki-moon, who stressed that Rio+20 was a “once-in-a-generation opportunity.”

This meeting prompted the UNCSD Bureau to announce that they would be scheduling an additional week of ‘informal informal’ negotiations, from 29 May to 2 June in New York. This week is designed to allow delegates the opportunity to reach a greater level of consensus on the outcome document prior to the official meetings in Brazil.

Co-Chair Kim also said that the Co-Chairs would jointly produce a new, streamlined text by 22 May to facilitate the third round of ‘informal informals’.

Ban, in an informal briefing to the UN General Assembly on Wednesday 9 May, commended the Bureau for scheduling additional negotiating days.

“I trust that this due process will unleash ambition, creativity, and the flexibility to get the job done,” he said. “After all, we cannot continue the same approach and get different results.”

“The time has come to shift gears to reach our destination in time,” he told member states, adding that countries should be “determined to confront the hard issues now - 100 percent of the issues - instead of kicking the can down to Rio.”

Sustainable Development Goals negotiations offer promise, observers say

While no agreement has yet been reached on the sustainable development goals (SDGs) - which were an initiative originally proposed by Colombia and Guatemala - sources note that the negotiations in New York saw broad support for their establishment. However, observers commented to Bridges, the politics surrounding the SDGs suggest that their launch will only be agreed at the very last minute in Rio. If so, sources suggest that a likely outcome would see a process to define the SDGs between 2012 and 2015, in order to coincide with the post-2015 Millennium Development Goals (MDGs) programme.

The SDGs have received backing from UN Secretary-General Ban Ki-Moon, who told the UN General Assembly on Wednesday that countries “should agree on launching a process to establish Sustainable Development Goals that build on the Millennium Development Goals.”

After Rio, the UN Secretary-General will appoint a High Level Panel of Eminent Persons to advise on the post-2015 way forward once the current MDGs expire, co-chaired by President Susilo Bambang Yudhoyono of Indonesia, President Ellen Johnson Sirleaf of Liberia, and Prime Minister David Cameron of the UK. Ban also said on Wednesday 9 May that he would be announcing the full panel following the Rio conference.

The issues that have seen the greatest overlap in the negotiations and have so far gained the most traction as possible priority areas that the SDGs could address include: food security; integrated water management; energy; sustainable and resilient cities; oceans; sustainable natural resource management; and sustainable employment.

Last week, the delegations of Colombia, Peru, and United Arab Emirates circulated a non-paper indicting these possible issue areas and the support for them received in various consultative processes since Johannesburg in 2002.

Next steps

With the additional week of ‘informal informal’ negotiations newly scheduled for 29 May - 2 June in New York, observers expect June to be a hectic month for all those involved in the Rio+20 preparatory process.

The third and final Preparatory Committee meeting of the UNCSD will take place on 13-15 June in Rio de Janeiro, ahead of the conference itself on 20-22 June.

ICTSD reporting; “Summary of the UNCSD Informal Informal Consultations: 23 April - 4 May 2012,” EARTH NEGOTIATIONS BULLETIN, 7 May 2012; “Green targets being watered down for UN summit - observers,” REUTERS, 1 May 2012.

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An earlier proposal by the administration of US President Barack Obama had outlined a US$30 billion cut; shortly thereafter, a budget proposal from the House Budget Committee had suggested a US$33 billion cut. (See Bridges Weekly, 21 March 2012)

The Senate Agriculture Committee’s bill, or the Agriculture Reform, Foodand Jobs Act of 2012, eliminates direct and countercyclical payments, making crop insurance the biggest budget item. Among the commodities, wheat, cotton, and feed grains would see the largest decrease in government payments. Although overall spending is widely expected to be lower, it is likely to become more trade distorting - moving away from direct payments to support that may influence planting decisions.

The proposed legislation also outlines reductions in outlays for direct payments and for nutrition and conservation programmes, while mandating increases in crop insurance, extension, and horticulture over a period of ten years.

To become law, a similar bill must also emerge from the Agriculture Committee of the US House of Representatives and then be reconciled with the Senate version before being put up for a vote in both chambers. The bill will then require presidential approval to become law; the 2008 Farm Bill was vetoed by then-President George W. Bush, only for Congress to override the veto.

In recent weeks, the House Agriculture Committee has been holding hearings on its version of the bill in Washington and across the country. Cuts in spending on food stamps, or the Supplemental Nutrition Assistance Program (SNAP), are expected to be a key difference between the House and Senate versions of the legislation. The Republican Chair of the House Agriculture Committee, Frank Lucas of Oklahoma, has recently put forth what he calls a “common sense” proposal that achieves savings by reducing costs and closing loopholes.

A finalised bill from the House will likely emerge in the coming weeks as legislators and the farm lobbies push to conclude a bill in both chambers before the current Farm Bill expires on 30 September.

Trade minimally important, observers say

According to some observers, discussions on trade negotiations, particularly at the WTO, have not played a significant role in the Farm Bill debate to date. In Senate testimonies earlier this year, trade or WTO commitments were only mentioned by commodity-specific lobbies and the American Farm Bureau Federation.

The Secretary of Agriculture, Tom Vilsack, referred to record exports of US$137 billion in 2011 and a historical record of 50 years of trade surpluses to underscore the importance of farming to the country’s trade position. A representative of the Rice Federation observed that increased spending in some developing countries will uncover “violations of WTO commitments,” while the National Cotton Council made the case that its proposals would resolve the US’ WTO dispute with Brazil. More recenttestimonies from the House were no different.

Urban Lehner, Vice President of DTN Progressive Farmer, summed up the attitude of legislators towards the WTO as being one of “who cares.” Representative Collin Peterson, a Democrat from the US state of Minnesota, is quoted as saying that the “WTO is irrelevant” to the Farm Bill if the US is within its commitments at the global trade body. Peterson added that the Doha Round of trade talks would likely be a failure if, as a “development round,” it encourages developing economies to view it as all take and no give.

Brazil weary of NCC proposal

The most discussed trade issue in the Farm Bill debate is perhaps a resolution to the United States - Upland Cotton dispute with Brazil. The high-profile dispute was put on hold in 2010, after the US agreed to pay Brazil US$147 million annually in exchange for the South American country refraining from putting into effect promised retaliation. Both countries also agreed that US farm legislation would be modified to resolve the dispute.

A Brazilian official, speaking on condition of anonymity, observed that the National Cotton Council’s STAX proposal will likely “not be accepted as a solution” to the US-Brazil cotton dispute. “We were disappointed with the markup from the Senate,” he added.

STAX is the Stacked Income Protection Plan for producers of upland cotton, a programme meant to make up for losses beyond what is covered under ordinary crop insurance. Ambassador Roberto Azevedo, Brazil’s representative to the WTO, had earlier written to Congressional agriculture committees describing how STAX and other proposals would be trade distorting.

The final Senate Bill is “very close” to the Council’s proposal, Mario Jales, a cotton expert at Cornell University, told Bridges. A minimum price, generally considered more trade distorting, is now absent from the bill and was present prior to the markup process. He added that the draft legislation does “very little” to reform the marketing loan rate program. The marketing loan provision was found to be the “most trade distorting” element in the United States - Upland Cotton case, according to Jales.

In the absence of a satisfactory resolution to the dispute, three members of the House, led by Ron Kind, a Democrat from Wisconsin, havesponsored legislation to end the US$147 million in annual payments to the Brazilian Cotton Institute. Critical of the STAX programme, Kind warned that it “will surely be challenged again by Brazil at the WTO.”

ICTSD reporting; “Trade Is Traded Off in the Farm Bill Debate,” THE PROGRESSIVE FARMER, 27 April 2012.

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El nuevo diseño es el resultado de incontables horas de investigación y consulta para modernizarnos y responder mejor a las necesidades de nuestra audiencia. La nueva revista es visualmente más ligera, requiere menos tinta para su impresión y está optimizada para facilitar su lectura en monitores, dispositivos móviles y tabletas.

En este primer número de la nueva etapa de Puentes incluimos una variedad de artículos sobre aspectos relevantes para la región en temas como propiedad intelectual, acuerdos comerciales, dimensión social de la globalización, cambio climático y medio ambiente.

Agradecemos el aporte de Johanna von Braun respecto a la negociación de los capítulos de propiedad intelectual en los TLC de los EE.UU. con Colombia y Perú; de Suyen Alonso Ubieta, editora de Puentes, en torno al Informe del Comercio 2011 de la OMC sobre los acuerdos comerciales preferenciales; y de Luis Alonso Sancho sobre la “diáspora” laboral como elemento para el desarrollo en América Latina.

En esta edición también incluimos las colaboraciones de Marisa Escobar, Francisco Flores López y Victoria Clark del Stockholm Environment Institutesobre desarrollo sin carbono en América Latina y el Caribe a través del uso de herramientas para la planificación de agua y energía; y de Roy Mora, Fernando Sáenz y Jean François Le Coq en relación a los conceptos de servicios ambientales y servicios ecosistémicos, y su aplicación práctica en Costa Rica.

Como siempre, agradecemos su preferencia. Próximamente dedicaremos un espacio a las cartas y sugerencias a los editores, por lo que los invitamos a enviarnos sus opiniones a puentes@ictsd.ch. Esperamos que nuestro esfuerzo y el de las instituciones que representamos sea de su agrado y que contribuya a nuestro objetivo de fortalecer el conocimiento de la relación entre comercio y desarrollo sostenible en América Latina.

Muchas gracias.

El equipo de Puentes

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Más destacados de ICTSD

This study examines how Russia’s WTO accession could affect agricultural trade and production. It finds that developing countries could gain from the accession, especially those exporting products such as beef, pork or sugar, and that grain importers could also gain from greater market stability if Russia respects new commitments on export restrictions.

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These and countless other issues highlight the need for attention and deeper dialogue to ensure policymakers are equipped with the knowledge they need to make well-informed decisions. This reality lies at the heart of what Bridges Trade BioRes stands for. Natural resources, sustainable energy, biodiversity, fisheries, forestry and other crucial environmental issues will continue to affect and be affected by trade and, as always, BioRes will endeavour to bring a balanced view to its wide range of regular readers.

In the 12 years that BioRes has been providing news, analysis and information to the trade and environment community, we’ve always endeavoured to be current, engaging, and useful. The release of the first issue of this year’s review takes these three tenets to heart.

The frequency of the review has been increased this year in response to readers’ expressed request for more commentary and analysis. Subscribers can, thus, expect a full magazine-style publication on a much more frequent basis. Our biweekly news periodical has also been overhauled to allow for more frequent news updates as stories unfold. Visit our “news stream” on our newly revamped homepage or visit us on twitter for regular updates. For a roundup of the salient trade and environment news items in the world today, explore the newsroom in every issue of BioRes.

The redesign of our periodical is the result of countless hours of research and consultation aimed at simply making the most pleasant reading experience possible. The new design is visually lighter, less ink-intensive when printing, and optimised for reading on computer screens, tablets, and mobile devices.

We hope you enjoy the changes and the articles presented in this issue. As always, we welcome your comments and feedback on what you read and may publish your remarks. Please write to us at biores@ictsd.ch

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Repsol uproar

Argentine President Cristina Fernández de Kirchner announced on 16 April that her country’s government planned to take a 51 percent controlling stake in the Spanish oil company, which would then be split between the Argentine central government and the country’s provinces in a 51-49 ratio.

The measure is currently making its way through the Argentine Congress, where it is expected to win approval and become law.

The Argentine President justified the move by arguing that Repsol has not sufficiently invested in new oil production, in turn causing Argentina to have to import more energy.

For its part, the Spanish oil company has argued that Buenos Aires’ recent transition to becoming an energy importer is instead the result of an unsustainable energy policy by Argentina.

Kirchner’s announcement quickly captured headlines, and led Spanish officials to caution that Madrid would push back in areas such as trade, energy, and diplomacy. Buenos Aires’ decision has also prompted concerns over the investment climate in Argentina, particularly by the US and Mexico, among others.

Following a cabinet meeting on Friday, Madrid announced that it would be offering incentives to prioritise the use of Spanish and EU biodiesel, which may in turn reduce imports of biodiesel from Argentina - the world’s leading supplier of soyoil and soy-based biodiesel.

Spanish biodiesel imports from Argentina amounted to 750 million euros in 2011, according to government statistics and Spain’s Renewable Energy Producers Association (APPA, by its acronym in Spanish).

Between January and March alone, Spain bought two-thirds of Argentina’s biodiesel exports, according to the private Argentine Biofuels Chamber (Carbio).

“If Spain’s government wants its own businesses to pay more for biodiesel, that’s a sovereign decision,” Kirchner said in response to the Spanish announcement. Buenos Aires can increase domestic demand for biodiesel to compensate, she added.

Argentina will not challenge such measures at the WTO, Kirchner said.

After Friday’s cabinet meeting, Spanish Deputy Prime Minister Soraya Sáez de Santamaría also pledged that “Spain will continue to seek diplomatic measures and actions in all forums.”

Spanish foreign minister José Manuel Garcia-Margallo has, for instance, called for international organisations, such as the World Bank, International Monetary Fund, and WTO to impose concrete measures to press Argentina “to return [to] the path of international rule of law.”

EU evaluating options

The EU, for its part, has also said that it will intervene on Spain’s behalf, according to Spanish trade secretary Jaime García-Legaz, speaking to Reuters last week on the sidelines of the G-20 trade ministers meeting in Puerto Vallarta, Mexico.

“There are going to be very clear interventions on the part of the European Union,” he said.

To that end, the European Parliament on Friday approved a non-legislative resolution asking the European Commission to consider partially suspending preferential trade treatment for Argentine exports.

MEPs also urged the Commission to use “all appropriate dispute settlement tools available at the WTO and G-20″ to respond to the move.

Spain is expected to soon ask the EU to file a WTO complaint against Argentina regarding the YPF seizure, according to senior government officials interviewed by Reuters. However, some trade observers have questioned whether such a complaint would be feasible, given that investment-protection pledges are not included in WTO rules.

“Unfortunately, there’s no real WTO angle to this,” an EU source in Geneva told Reuters. “This is a matter of investment and expropriation which is dealt with by the bilateral treaty.”

Spain and Argentina currently have a bilateral investment treaty that entered into force in 1992. Investment treaties provide protection to foreign investors by guaranteeing national and most-favoured nation treatment, and usually protect against expropriation without compensation. These treaties further give investors the chance to call for international arbitration to solve investor-state disputes.

“This issue is not a trade issue; this is an investment issue,” WTO Director-General Pascal Lamy said at a meeting of G-20 trade ministers last week.

De Gucht: Import curbs, YPF seizure ‘jeopardising’ trade, investment relations

Buenos Aires has also faced a barrage of criticism by many of its trading partners, including Brussels, in recent months over its strict import controls, with reports emerging in the past week that the EU may soon pursue a WTO complaint to challenge the import curbs.

The import policies, along with the YPF seizure, were strongly criticised in a letter sent by EU Trade Commissioner Karel De Gucht to Argentine foreign minister Héctor Timerman last week.

“Against this background, I wish to express the EU’s serious concerns about the overall business and investment climate in Argentina,” De Gucht said, according to Dow Jones Newswires.

“Regrettably, Argentina has not presented any valid justification for these [import restrictions] nor taken any real steps to remedy the situation,” the EU trade chief added, cautioning that the “situation [over YPF and the import curbs] is now at a point where it risks jeopardising our overall trade and investment relations.”

Argentina’s import control policies had previously come under fire at a meeting of the WTO Council for Trade in Goods last month, with the EU joining 13 other WTO members in lambasting the measures. (See Bridges Weekly, 4 April 2012)

ICTSD reporting; “G-20 Ministers, WTO Chief Don’t See Argentine Expropriation As Trade Issue,” DOW JONES NEWSWIRES, 20 April 2012; “El Gobierno tapona por decreto la importación de biodiesel de Argentina,” EL PAÍS, 20 April 2012; “Spain targets Argentine biodiesel in YPF reprisal,” 20 April 2012, REUTERS; “UPDATE 1-Spain has few ways to pressure Argentina over YPF,” REUTERS, 18 April 2012; “UPDATE 2-EU to back up Spain on YPF case -Spanish official,” REUTERS, 19 April 2012;  “Spain Retaliates Over Move by Kirchner to Grab Oil Firm,” WALL STREET JOURNAL, 20 April 2012′; “Spain Steps Up Argentina Pressure,” WALL STREET JOURNAL, 22 April 2012.

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