The Last Round: The General Agreement on Tariffs and Trade in Light of the Earth Summit

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I. Introduction

The 1992 United Nations Conference on Environment and Development (UNCED) held in Rio de Janeiro dealt with an unprecedented number of issues. Nevertheless, several important matters were marginalized or ignored. For example, neither population nor agriculture issues were included in the U.N. General Assembly Resolution Betting up UNCED. The importance of other issues for sustainable development, for example the linkages between trade and environment, was not recognized fully in 1989. For this reason - and because governments engaged in what they hoped was the final phase of the "Uruguay Round" were manifestly unwilling to have trade issues considered in a forum dominated by concerns for sustainable development - the relationship between trade and environment was inadequately covered at UNCED.

Nevertheless, the linkages between trade and environment are liable to loom large over the implementation of UNCED decisions in the coming years, over Agenda 21(2) in particular. There can be no development without free trade, however, sustainable development requires important adjustments to the trade regime to ensure that international trade does not undermine the environmental regimes which are being established nationally and internationally.

Because trade and environment linkages were virtually ignored at UNCED, one might reasonably assume that the Earth Summit holds few lessons for trade regimes. Nothing could be further from the truth. The UNCED may come to be seen as a watershed in international relations for two areas: 1) UNCED may mark the eruption of vastly complex issues of environmental management and sustainability into every nook and cranny of international economic relations, and; 2) UNCED may mark a change in the nature of international relations as they shift from the excessive focus on "security" during the Cold War era to the establishment of regimes that ensure the international management of environmental and economic relations. This suggests that dramatic changes will also occur in trade regimes, perhaps necessitating a world conference on the international economy comparable to UNCED in which those concerned with environment and sustainable development must participate but with more emphasis on sustainable development.

For several decades, the General Agreement on Tariffs and Trade (GATT) has worked through a sequence of "Rounds." Rounds are comprehensive trade negotiations in which virtually all current issues concerning international trade are reviewed and negotiated. These Rounds have become increasingly complex as negotiators have sought to secure past gains from the erosion of time and changed circumstances while enlarging the scope of the regime to deal step by step with the limitations of the original Agreement. With every Round, the number of participants has grown markedly as the process of decolonization proceeded in the market economies. The collapse of the Soviet empire promises to bring another fresh crop of members(3) from the Second (formerly socialist) World with entirely new problems in their trading relations. The sheer weight of the negotiations raises the question whether future "Rounds" like the current Uruguay Round will be possible. There are, however, other reasons related to environmental management and sustainable development which also suggest that there will be no further Rounds and that those who formulate trade regimen will need to rethink the manner in which they conduct their business.

II. History of the GATT

The approach to trade negotiations through Rounds reflects the strange institutional character and origin of the GATT.(4) Originally, the Agreement was part of a broader regime for international trade, an International Trade Organization (ITO) as part of the Bretton Woods institutions, to be established by the Havana Convention. The countries concerned with negotiating the Havana Convention met in Geneva in 1948, some months before the scheduled Havana Convention. …