Remarks by Gregory J. Spak

By Spak, Gregory J. | Proceedings of the Annual Meeting-American Society of International Law, Annual 2012 | Go to article overview

Remarks by Gregory J. Spak


Spak, Gregory J., Proceedings of the Annual Meeting-American Society of International Law


INTRODUCTION

Do export-led agricultural strategies necessarily conflict with international trade rules and the concept of sustainable development? Clearly not. One can easily imagine a situation in which a sovereign nation takes advantage of its natural resources (agricultural or otherwise) in a manner that is both sustainable and consistent with international trade rules. For example, there is nothing wrong with New Zealand taking advantage of its natural resources to develop an export-led economy, and there is no reason why many aspects of such a strategy would not be sustainable.

Equally easy to imagine are instances in which export-led economic strategies conflict quite directly with international trade rules and any principles of sustainable development. A country located above the Arctic Circle subsidizing the development of a pineapple export industry would likely do violence to both existing international trade rules and most conceptions of sustainable development. There are many examples between these two extremes in which the tension between an export-led strategy, international trade rules, and the concept of sustainable development becomes apparent in varying degrees. Whether consistency and coherence can be achieved in such cases is open to discussion.

The WTO offers a good forum for such discussions. The WTO Agreement already identifies sustainable development as one of the guiding principles of the liberalized trading system, and this principle has been reflected in some of the early decisions. However, sustainable development is never defined, and there is no guidance as to how the substantive trading rules can be applied to achieve sustainable development. There is ample room for improvement.

THE WTO IS THE APPROPRIATE FORUM

The WTO is the most appropriate and promising institution to address trade patterns that are unsustainable from the perspective of sustainable development. The WTO already contains some rules on these issues, and has hosted extensive negotiations among member governments, both since its inception in 1995 and more recently in the context of the Doha Round. Where the requisite political will exists, the WTO has proved itself to be an effective negotiating forum to confront difficult issues. In terms of enforcement, the WTO represents one of the most successful international legal systems, with a strong dispute settlement mechanism and a high rate of compliance.

Attempts to define the proper relationship between trade rules and sustainable development outside of the WTO would likely fail. Regional and bilateral agreements may contribute to some progress in the field, but they would be too limited in scope to rectify the problems arising in a global marketplace. While plurilateral agreements could perhaps achieve greater coordination among governments, like bilateral and regional agreements they would potentially suffer from a lack of comprehensiveness and a lack of consistency with WTO rules and jurisprudence.

WTO RULES ARE CURRENTLY INSUFFICIENT

There is "unevenness" in the current WTO rules beating on the issue of sustainable development. On the one hand, the Marrakesh Agreement Establishing the World Trade Organization (WTO Agreement) contains many specific rules, including those for lowering tariffs (GATT Article I), removing other import and export restrictions (GATT Article XI), and controlling trade-distorting subsidies (GATT Article VI, the Agreement on Subsidies and Countervailing Measures (ASCM), and the Agreement on Agriculture). By contrast, rules on permissible environmental and sustainable development policies are mentioned only generally, and currently the most relevant provisions are relegated to the General Exceptions of GATT Article XX. (1) There is no guidance as to how the goal of sustainable development should be balanced against the substantive trade disciplines when a conflict arises. Absent more specific rules, the adjudicatory bodies are not able fully to address the sustainability goals and arguments of responding parties when their policies and measures are challenged at the WTO.

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