Bridges Weekly Trade News Digest • Volume 5 • Number 43 • 20th December 2001
EU Signs Association Agreement with Algeria
Latest NAFTA Investor-State Claim Launched
US-based Crompton Corp. (formerly UniRoyal Chemical) has launched the latest investor-state suit against the Canadian government under the North American Free Trade Agreement (NAFTA). Their case alleges that the Canadian Pest Management Regulatory Agency (PMRA) contravened certain articles in NAFTA’s Chapter 11 (on investment rights and obligations) when it moved to phase out lindane - a pesticide produced by Crompton and historically used in canola seed production. Lindane, an organochlorine pesticide similar to DDT, has been associated with the development of breast cancer and nervous disorders and has been banned for all uses by seven countries, and severely restricted in another four (including the USA). It is also one of 27 pesticides on the PIC list (Prior Informed Consent) - which requires exporters to inform importing countries of a chemical’s legal status and potential hazards. Crompton Corp. is seeking 100 million dollars in damages. Lindane remains in widespread use throughout the developing world. The notice of intent, dated 6 November 2001, is posted on the website of the Canadian Department of Foreign Affairs and International Trade.
"US Chemical Company Seeking 100 Million in Damages" STRAIGHT GOODS, 8 December 2001; ICTSD Internal Files.
Caribbean Community Cautiously Supports FTAA
A two-day summit in Venezuela of the Association of Caribbean States (ASC) ended on 12 December with a cautious endorsement of the proposed Free Trade Area of the Americas (FTAA). The proposed FTAA would create an economic free trade area that spans the western hemisphere - comprising 33 of 34 countries (except Cuba). At the summit, Venezuelan President Hugo Chavez, alongside Cuba’s Fidel Castro, made clear their concerns that the FTAA, with economies such as Canada and the USA, could spell doom for the smaller economies in the proposed zone. Chavez took the point one step further by proposing that should developed countries not lower tariff barriers for developing country goods, an alternative agreement should be considered. He went on to suggest that such an agreement could be called the "Bolivarian Alternative for the Americas," after South American independence fighter and hero Simon Bolivar. In addition, he indicated his government’s intention to put the deal to a popular vote.
"Caribbean Leaders Endorse Trade Pact" AP, 12 December 2001.
On 19 December, the EU and Algiers concluded seven years of negotiations with an ‘Association Agreement’. This type of agreement — which the EU has signed with seven other countries — mandates the two countries to open up trade and provides for greater cooperation on a broad set of issues - ranging from education to fighting terrorism. In addition, the agreement binds Algeria to modernise its legislation in areas such as competition policy and intellectual property rights. As such, sources speculate that this is a preparatory step for Algeria to move from observer status to being a full member at the WTO. Critics, including as Amnesty International, condemn the EU over the agreement, saying it is turning a blind eye to abuses by Algeria’s security forces in return for support for the ‘coalition against terrorism’.
"European Union Wraps Up Trade Cooperation Deal with Algeria" AP, 19 December 2001.
Insurance Agreement Aims to Assist African Trade
On 11 December, the African Trade Insurance Agency (ATI) and insurance group Gerling signed a pact that will allow companies trading to and within Africa to obtain insurance against non-payments by buyers. ATI was established at last May’s Common Market for Eastern and Southern Africa (COMESA) summit, with start-up funding provided by the International Development Association - the concessional lending arm of the World Bank (see BRIDGES Weekly, 29 May 2001). The seven African countries that have joined the agency include Burundi, Kenya, Malawi, Rwanda, Tanzania, Uganda, and Zambia. The ultimate aim of the pact is the creation of a private sector and pan-African credit insurance company.
"Insurance pact aims at boosting trade in Africa" FT, 11 December 2001.
WIPO Committee: Countries Divided Over Need For New Legal Norms To Protect TK
Substantive discussion at the second meeting of the WIPO (World Intellectual Property Organization) Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore on 10-14 December in Geneva focused mainly on two subjects: operational principles for contractual agreements concerning access to genetic resources and benefit-sharing; and traditional knowledge as prior art. While there was little in the way of a debate and the atmosphere was non-confrontational throughout, there was a clear division between those countries that favour the creation of new legal norms (mainly from Latin America and the Africa Group) and those that do not, including the US and Canada . The latter group of countries considers that solutions should be sought within existing legal frameworks and, while willing to contemplate additional obligations, would prefer these to be non-binding. Industry representatives also shared this view by calling for non-binding obligations. The official documents on the second WIPO Intergovernmental Committee can be downloaded from the WIPO website. For further information, see BRIDGES Trade BioRes, 20 December 2001..
ICTSD Internal Files.
US Steps Up Pressure Over Biotech Rules
The US is reported to be losing patience with the continued EU de facto moratorium on the approval of genetically modified organisms (GMOs), with pressure mounting within the US to bring a case to the WTO. According to EC Environment Commissioner Margot Wallstrom, however, the ban — in place since 1998 — is likely to remain for at least another two years while EU member states continue to debate proposed labelling and traceability regulations (see BRIDGES Weekly, 31 July 2001). At the same time, environmental organisation Friends of the Earth International (FoEI) has attacked the US and Argentina for allegedly pressuring small countries, such as Bolivia, Sri Lanka and Croatia, to refrain from implementing strict import rules for GMOs. For further information, see BRIDGES Trade BioRes, 20 December 2001)
"U.S. said losing patience with EU ban on GMOs; pressure rises for WTO complaint," WTO Reporter, 13 December 2001; "US and biotech corporations impose genetically modified organisms worldwide under WTO threats," FoEI PRESS RELEASE, 17 December 2001.