Class 7 on Global Environmental Politics (topic: trade and environment). All slides courtesy of Prof. Dr. Joachim Monkelbaan

1. TRADE AND
ENVIRONMENT
INTERNATIONAL UNIVERSITY IN GENEVA
DR. JOACHIM MONKELBAAN

2. Today
1. Relations between trade and environment
2. Narratives in trade and environment
3. The WTO and sustainable development
4. Non-discrimination in the WTO
5. GATT Article XX exceptions
6. WTO dispute settlement cases
7. Trade and SDGs
8. Other relevant WTO agreements

3. RELATIONS BETWEEN TRADE AND
ENVIRONMENT
• Scale effect
• Composition effect
• Technique effect
• Direct effect
-> how does environment/do environmental regulations
affect trade?

5. NARRATIVES
• Argument: trade rules undermine environment; environmental
rules undermine trade
• Trade liberalization, especially through the multilateral trading
system makes possible a more efficient allocation and use of
resources and thereby frees and generates resources for
environmental protection; it also promotes import of ESTs and
trade in environmental goods and services (EGS)
• Sound environmental policies guarantee the current and future
sustainable use of resources necessary to maintain and increase
trade
• Hence: trade and environment are mutually supportive provided
policies in both areas are mutually consistent and coherent

6. WTO
Preamble:
‘all trade relations should be conducted with a view
to raising standards of living, ensuring full employment and
a large and steadily growing volume of real income and
effective demand, and expanding the production of trade in
goods and services, while allowing for the optimal use of
the world’s resources in accordance with the objective of
sustainable development, seeking both to protect and
preserve the environment and to enhance the means for
doing so in a manner consistent with their respective needs
and concerns at different levels of economic development.’
(1994 Marrakesh Agreement, Preamble, para 1)

7. PRINCIPAL WTO RULE:
NON-DISCRIMINATION
WTO members are free to adopt national environmental
protection policies provided that they
• do not discriminate between imported and domestically
produced like products (national treatment) and
• do not discriminate between like products from different
trading partners (most-favoured nation clause)

8. GATT ART. XX/GATS ART. XXIV (B):
GENERAL EXCEPTIONS
• Necessary to protect human, animal or plant life or health (verified by
“necessity” test)
• Relating to the conservation of exhaustible natural resources if such
measures are made effective in conjunction with restrictions on
domestic production or consumption (GATT only)
• Conditions for measures: measures should not be applied in a manner
which would constitute a means of arbitrary or unjustifiable
discrimination between countries where the same conditions prevail, or
a disguised restriction on international trade

9. WTO DISPUTE SETTLEMENT CASES
•Shrimp-turtle
•Tuna-dolphin

13. • The ultimate goal is to achieve a win-win-win situation: trade-environment-
development
• Policy coherence
Type of MEA trade measures:
• Trade bans/sanctions
• Export/import licenses
• Notification requirements
• Packaging and labelling requirements
CTE: of the 200 MEAs in force, only about 20 contain trade provisions

14. OTHER WTO AGREEMENTS
RELEVANT TO THE ENVIRONMENT
• General Agreement on Tariffs and Trade (GATT): Art. XX (general
exceptions)
• General Agreement on Trade in Services (GATS): includes
“environmental services”
• Agreements on Sanitary and Phytosanitary Measures and Technical
Barriers to Trade (SPS/TBT): major issue in protectionism
• Agreement on Agriculture: non-trade concerns, “green” box
measures
• Agreement on Subsidies and Countervailing Measures
• Agreement on Trade Related Intellectual Property Rights (TRIPS):
core issues are biodiversity and development and transfer of
environmentally sound technologies

15. ANY
QUESTIONS?
jmonkelbaan@iun.ch