Environmental considerations in a new multilateral agricultural negotiation, and associated Developing Country implications

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Abstract

This paper discusses the potential role for environmental considerations in agricultural negotiations in the next WTO trade round, from developing country perspective. For now, as a non-trade issue in the new negotiations, environmental considerations are not the dominant concern, which is food security; although conflicts have arisen over the issue of multi functionality (agriculture serving multiple purposes including providing support for the rural environment), whether export subsidies have any rationale on environmental grounds, and the environmental case for the elimination of fishing subsidies. If new agricultural disciplines remain focused on the Uruguay Round issues of tightening the existing structure of bound tariffs, and limitations on domestic supports and export subsidies, then environmental concerns could enter in all of these. I suggest that for the developing countries, available studies seemingly point to substantial gains for them from internalization of externalities related to their own rural/agricultural activities and seemingly, further, environmental concerns should dominate trade concerns. However, the agriculture disciplines from the Uruguay Round seemingly provide relatively inefficient instruments to achieve substantive internalization of their externalities. Also, allowing environmental concerns to enter runs the risk of market restricting justifications (multi functionality) adversely affecting their export access to foreign markets. Finally, among the list of items on the trade and environmental agenda (Art 20 exceptions, MEAs, lax standards, eco-labeling) few or none can be addressed adequately as part of an environmental negotiation, and so environment in an agricultural negotiation is no substitute for a wider trade and environment negotiation. The bottom line is to suggest that developing countries focus heavily on environmental issues, perhaps even more so than trade, but that a WTO negotiation on agriculture is not the best forum to seek a remedy.

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