WTO Ministerial Section • Volume 3 • Number 15.5 • 8th September 2003
WORKSHOP 1: Trade and Sustainable Livelihoods
Special Issue - 8 September 2003 WORKSHOP 1: Trade and Sustainable Livelihoods back
The trade and sustainable livelihoods workshop focused on the linkages between trade policy, trade rules and sustainable livelihoods as well as the potential of sustainable trade initiatives as tools for poverty alleviation and environmental conservation. 25-50 participants from a range of countries representing poor communities, NGOs, international institutions, research institutes and donors participated in the seven workshop sessions.
The relevance of trade to sustainable livelihoods objectives
Setting a framework for the workshop stream, participants were introduced to ideas and perspectives on how sustainable livelihoods objectives are linked to international trade policy. Amongst others the crucial need to identify the barriers and conditions for entering global markets as well as to ensure that profits are distributed to the actual producers of agricultural commodities was pointed out. Workshop participants furthermore discussed to what extent the WTO is the main rule setting body. While some participants stressed the need to accept existing trade rules when entering international markets, others fundamentally questioned whether sustainable trade could be developed in this context. Participants agreed that the WTO is the main rule setting body and that it is necessary and indeed possible to influence its decision making process. The case of TRIPs and Health was mentioned as an example of what can be achieved if civil society groups work together with interested governments. Questions arose with regards to how the multilateral trading system could be influenced in such a way that it promotes sustainable livelihoods and the conservation of biodiversity. Several groups also pointed out that the environmental community need to build a positive and proactive agenda if it wants to successfully influence the trade policy debate. Commodity chains setting a framework for producers of Cotton, Coffee and Cocoa
The analytical framework of commodity chains was presented during the workshop as a useful way to analyse the connection between producers and markets as well as to determine who reaps the profits in a particular chain. Presentations on sustainable forest management, the commodity chains of cotton, coffee and cocoa, and the ensuing discussion made apparent that in most agricultural chains producers are squeezed by market dynamics. Discussions on how these dynamics develop touched upon the fact that although producers are the main users and custodians of natural resources and biodiversity, they do not receive enough profit from their production to take care of their surrounding environment in a sustainable manner. In most agricultural commodity chains both profit and power is located with intermediaries or larger processing firms, resulting in the marginalisation of the actual producer. Another point raised was that markets and trade rules do not differentiate between specific production processes or the particular needs of producers — the commodity chains approach allows for such a differentiation, and market differentiation along specific commodities is essential to change the dynamics in a particular commodity chain. During the workshop session participants discussed whether premium prices paid by consumers for products from sustainably managed resources are really sufficient to substantively improve the livelihoods of marginalised farmers. Often price premiums are too small to make it worthwhile for producers to change to more sustainable production practices. Against this background some participants stressed the need for a compensatory mechanism to re-balance market failures; a mechanism that would pay farmers not only for the products they produce, but also for conserving biodiversity and preserving ecosystem services.
Touching upon the subject of eco-labelling and certification, workshop participants discussed the market barriers faced by developing country farmers who engage in organic agriculture. Highlighting the competitive advantage of developing country farmers in organic agriculture, some participants stressed the need that developing country governments look afresh at the issue of process and production methods in the WTO. This point was raised in particular in relation to the ongoing negotiations on environmental goods and services. Some participants, however, warned that these negotiations should be handled with great care, considering their broader implications for public services such as water and sanitation in developing countries. As an alternative it was suggested to explore the extent to which geographical indications might be useful to distinguish agricultural products from ecologically sensitive regions such as Amazonia or Ramsar protected areas.
Sustainable trade initiatives - creating opportunities for sustainable livelihoods
Representatives from developing countries shared their experiences from various initiatives that use trade as a tool to alleviate poverty, foster the sustainable use of natural resources and the conservation of biological diversity. Experiences from these initiatives confirmed that there is indeed a large and rapidly growing market for sustainably produced products and services. There exist, however, many difficulties in efforts to connect producers to markets. Participants stressed the importance of creating links between rural and urban areas and creating new networks to assist small producers to engage efficiently in these markets. Representatives from Brazil, Mexico, Costa Rica and Guatemala briefed the workshop on their experiences in creating sustainable trade initiatives. One of the key questions raised in this regard was whether and how producers from sustainable trade initiatives could increase their market shares. In this context participants also pointed to the need for capacity building as well as the need to clarify in what way WTO rules support or undermine sustainable trade initiatives and how these can compete in markets shaped by large multinational companies. The discussion furthermore highlighted the importance of domestic and regional institutions in the development of such initiatives.
Labelling and certification - economic incentives opening spaces
With regards to economic incentives, labelling and certification schemes the workshop initially focused on the potential for developing environmental labelling schemes within the framework of Multilateral Environmental Agreements (MEAs). CITES and RAMSAR were cited as examples for ongoing efforts to develop such schemes that support local producers in environmentally sensitive areas. Concerns were raised with regards to how a meaningful standard could be defined and how meaningful links between the multiple existing labelling and certification schemes could be established. It was agreed that labelling and certification schemes could be an important tool to support the development of sustainable livelihoods and provide producers with positive incentives to manage natural resources in a sustainable manner. However, it was also highlighted that currently there was a lack of definition of what a useful standard is - in particular from the perspective of the conservation community. Participants furthermore recognised the concerns of developing countries that environmental standards could be used by developed countries to protect their markets. In this context the need for greater transparency and developing country participation in international standard setting bodies was stressed. In conclusion participants agreed that labelling and certification schemes provide opportunities for sustainable rural development and nature conservation and should thus receive greater attention by the conservation community. Trade policy supportive of sustainable livelihoods
During the final session workshop participants agreed that developing countries and the conservation community need to make use of all the available tools to promote sustainable livelihoods and sustainable trade. However, in doing so, attention has to be give to the specific concerns of developing countries and civil society such as market barriers that may arise from domestic environmental measures and the potentially negative impacts of the negotiations on environmental goods and services. The concluding remarks focused on the urgent need to create a knowledge community and a network of individuals and institutions working on issues of sustainable trade, sustainable livelihoods and biodiversity conservation from a developing country perspective. Finally, participants stressed the urgency to end agricultural dumping on world markets as part of efforts to eradicate poverty, improve livelihood conditions in rural areas and provide primary producers with opportunities and openings to engage effectively in trade on the basis of their competitive advantage.