Bridges Trade BioRes • Volume 6 • Number 7 • 14th April 2006
RENEWABLE ENERGY, AIR POLLUTION ENVIRONMENTAL GOODS CONSIDERED AT WTO
RENEWABLE ENERGY, AIR POLLUTION ENVIRONMENTAL GOODS CONSIDERED AT WTO
At an informal meeting of the WTO Committee on Trade and Environment Special Session (CTE-SS) on 4-5 April, WTO Members evaluated proposals seeking expedited liberalisation for certain renewable energy and air pollution control products. The technical discussions — held under a mandate from Paragraph 31(iii) of the Doha Declaration to negotiate on "the reduction or, as appropriate, elimination of tariff and non-tariff barriers to environmental goods and services" — centred on proposed lists of products in the two categories submitted by the EU, Canada, Japan and Chinese Taipei. The lists, which were based on the Members’ earlier submissions of lists of products in all categories of use, were examined on a product-by-product basis to evaluate which products have a single, clearly environmental end use.
The move to limit discussions to the application of one criterion (single environmental end-use) and two categories had been proposed by a group of developing countries at the last meeting of the CTE-SS (see Bridges Trade BioRes, 3 March 2006). During the discussions many of the proposed products were criticised by developing countries as not having a clear, single environmental purpose. Brazil, China, Malaysia, Thailand and others suggested that the listed products had been included less for their environmental end-use, and more because they were major export products of the proponents. They noted that since most of the products are advanced industrial technologies not produced by most developing countries, the reduction of tariffs on these products would benefit primarily developed countries, and could even hurt developing countries because they would have to reduce their tariffs on these products. While some developing country governments would prefer not to spend valuable foreign exchange on imports of foreign technology, and would prefer to develop domestic capacity to produce these products, others suggest that lowered prices of environmental technologies would enable them to buy and use them more cheaply, thereby reducing costs and making environmental goals more feasible.
Still others suggested that the normal practice in WTO negotiations of using six-digit codes from the World Customs Organization’s harmonised system of tariff lines would identify products too broadly, because one six-digit product code could cover thousands of different kinds of products, some with and some without environmental end-uses. Instead, they suggested using eight-digit codes as a possible solution to make it easier for customs officials to apply reduced tariffs to specific environmental goods. The Members submitting the lists said that they would try to address these concerns in subsequent submissions.
While the technical discussions were held without prejudice to the approach to be taken in the negotiations, some developing country delegates expressed disappointment after the talks, saying that the list approach does not seem to offer the solution to developing country environmental problems that they are seeking from the talks. Many developing country delegates support India’s proposed "environmental project approach" to temporarily reduce tariffs for certain goods and services used in approved "environmental projects" (see Bridges Trade BioRes, 23 June 2005). However, delegates recognised a lack of capacity on environmental goods as a reason why most developing countries have not submitted lists, proposed changes to existing approaches, or put forth a new approach to talks under Paragraph 31(iii) that would enable them to achieve their sustainable development goals.
Another technical discussion on products in the categories of wastewater management and hazardous waste management will be held on 10-12 May. Sources suggested that the US, Brazil, India and China may present papers on approaches to the negotiations at the next formal meeting of the committee, scheduled for 14-15 June.
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