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Environment and international trade

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  1. Introduction.
  2. Trade and environment in relation to each other.
    1. The problem of pollution and Environment protection.
    2. Environment and the developing countries.
  3. The legal frame provided by the WTO.
    1. Key provisions.
    2. Two examples of WTO rulings.
  4. Conclusion.
  5. Bibliography.

The warming of the planet and global climatic change has been the centre of heated debate for the last few years. The environmental problems, by the force of nature, somehow set themselves to the political agenda of the planet. In this paper I'd like to see if the concepts of trade and environment protection often cited as opposite are really antagonist, or if in the contrary, there could be a harmonious development of the two concepts. In my second part, I'd like to answer the question whether the WTO, faced to both aspects, chooses to favour trade over environment or if it has a pro environment sensibility. Pollution is commonly seen as the result of market imperfection. Indeed, the market is unable to adjust its prices to take into account two fundamental features of the human social life. The first of those features is the three functions of the environment, that is to say ?a consumption good, a supplier of resources and a receptacle of waste? (Butler, 2000, p434) and the second one is the public nature of a good like environment (no one owns for example what we could call fresh air).

[...] It reads as follows : ?that their relations in the field of trade and economic endeavour 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 and 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. [...]

[...] According to a 1999 report of the WTO on environment and trade ?trade liberalization can harm local environment in countries with a comparative advantage in polluting industries and improve the local environment elsewhere' (quoted by Charnovitz p529). This statement implies that countries possessing an advantage in polluting industries are highly likely to harm their environment in focusing only in this particular type of industry. A few years later, the position of the WTO, expressed in a report to the Cancun WTO Ministerial Meeting, has somehow changed: was generally recognized that improved market access for developing countries' products was key to the goal of achieving sustainable development' (quoted by Bernstein p253). [...]

[...] In response to such a disadvantage, liberal environmentalism tries ?through a conscious effort on the part of international policy elites to develop a set of ideas that changed the issue from one of preserving the environment to one that promoted economic growth, but of a sustainable kind, given natural support systems required for the economy' (Bernstein p247). In others words, upholders of environmental liberalism tend to push forward a certain dose of environmental protection, without seeking to the preservation of the world's economic order. [...]

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