Environmental trade barriers affect LDC exports — study

A number of environmental regulations pertaining to trade seem to be reversing prospects for developing countries in the midst of free global trading.

A study conducted by the United Nations’ International Trade Center (ITC) showed that in 1999 alone, 88 percent of the products being traded globally are subject to environmental trade barriers (ETBs). Traders from developing nations believe that in one way or the other, these regulations intervene in the potential access of the commodities in major markets.

Trade statistics gathered by the ITC indicate that at least 49 least developed countries (LDCs) are largely exposed to ETBs. Some 3,746 merchandise out of the 4,917 total goods examined in the world trade excluding services hurdle 115ETBs imposed by importing countries, according to the study. These account for $69 billion of world trade, the study shows.

Though only 43 of these ETBs are in force, they cover measures meant to protect the health and safety of wildlife, plants, animals and humans and some general policies such as the eco-labeling standard and the like. According to the ITC, any country can enforce such measures as WTO rules allow.

"As you know, WTO rules clearly permit countries to put up trade barriers for environmental reasons. The questions we tried to answer are: how widely are such sanctions applied, for what products, and what are their effects?" said Friedrich von Kirchbach of the ITC in an interview by the ITC Forum.

He said that around 40 percent of the products exported by LDCs are directly affected while only 20 percent from developed nations are subject to ETBs.

Of the ETB-affected merchandise, the ITC study revealed that boneless bovine cuts top this list, along with automobiles and motor vehicle parts, indicating that both agricultural and industrial products are clear targets of ETBs.

"We have listed 100 in all. The most important prominent are coniferous lumber, natural gas, footwear, medicines and telephones," Kirchbach said, citing other commodities prone to ETB sanctions.

The study however stated that while the data could spark debates on the impartiality of ETB sanctions, the value of trade directly affected by ETBs is only 13 percent of world trade.

"Of the 3,746 products I mentioned, 86 percent of the value of world exports bypasses these barriers. That means exporters focus their shipments on markets free of such restrictions," Kirchbach said.

There is also a need to look at the whole spectrum of ETBs and not simply on bans on imports, according to ITC. These include customs surcharges, technical regulations, quantity control measures or quotas and some monopolistic measures. – Philexport News & Features