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Trade, Investment and Sustainable Development
Aimee
T. Gonzales
Exploration
of the linkages between trade, investment and sustainable
development has been characterised by widely diverging opinions on
the effect of liberalising trade and investment. At one end of the
spectrum are those who believe that liberalisation creates wealth
for all, which both increases human welfare and provides resources
for environmental protection. At the other end of the spectrum are
those who believe that trade and investment liberalisation conflict
with national policies and international agreements which are
designed to minimise the negative social and environmental impacts
of economic activities.
Since
the debate on the relationship between trade and sustainable
development began in earnest, more than five years ago, the middle
ground in this spectrum of opinions has become more densely
populated. While increasing numbers of people have accepted that
there are conflicts between trade and investment liberalisation and
sustainable development, more people have also accepted that a range
of policies can and should be designed to minimise those conflicts,
while maximising the potential of trade and investment to
contribute positively to sustainable development. To date, however,
little has been done on specifying what those policies are, or how
they relate to each other - i.e. how they are integrated.
There are a variety of reasons for the failure to develop
innovative, integrated policies which harness trade and investment
to sustainable development.
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Separation of jurisdictions and competence between different
inter-governmental organisations and ministries within
governments. Trade, economic, environment and development
policies have been made in separate national or international
boxes for so long, that integration efforts have initially
foundered on territorial disputes, lack of understanding,
absence of coordination mechanisms and inadequate allocation of
analytical and policy-making resources. |
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Failure to engage sufficiently all the major groups, including
business and industry and public interest NGOs, in this policy
integration process. |
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A lack of political will from national governments to adopt the
task of integrating environment and development policy
objectives into mainstream policies like trade and investment.
Some intergovernmental institutions, notably the WTO, have also
shown considerable resistance to this policy integration task. |
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Failure to adequately resource, or politically empower, the
intergovernmental body charged with leading policy coordination
and integration in this area - the Commission on Sustainable
Development (linked to the lack of political will at the
national level, noted above). |
Those institutional divisions and political and technical failings
have been compounded by having a moving target. The shape of the
world and national economies is changing rapidly under globalisation,
and governments appear to have fewer and less powerful policy tools
to manage those changes. And all the while worsening environmental
conditions and deepening poverty in many parts of the globe make
the need for sustainable development ever more urgent.
So
what should be our response to this inertia in the face of a crisis?
Having worked for more than six years on trade and sustainable
development, within the existing national and international
frameworks, WWF concluded that a new approach was necessary to make
concrete progress on truly integrated policy-making. Accordingly,
in 1996, WWF secured funds from seven national governments and the
European Commission to create an Expert Panel on Trade and
Sustainable Development (EPTSD).
The structure and composition of the EPTSD seeks to address the
four barriers to progress listed above. The 18 places on the panel
are divided equally between internationally recognised experts who
specialise respectively in trade, environment and development. Each
expert has the experience of policy integration across at least two
of these policy sectors, and some across all three. The composition
of the panel reflects a balance between countries at different
levels of development, and geographical regions.
The panel includes serving and former governmental and
inter-governmental officials, NGO representatives, business
representatives and analysts from independent policy think-tanks.
They all serve in their personal capacities, so that they are not
bound by any national or institutional positions on trade and
sustainable development issues.
Development Alternatives is honoured to be associated with the
Panel.
With our experience gained over the years on issues of environment
and development, we believe that we would be in a position to
contribute to developing better policy tools for a more equitable
global trade.
While the panel cannot directly generate the necessary political
will in governments to implement its policy recommendations, it is
hoped that the balance, quality and innovative nature of those
recommendations will be sufficiently persuasive to secure
implementation. The fact that the panel is wholly government
funded, and on a multilateral basis, indicates support for this
approach. The fact that it is wholly outside existing institutions
should help it avoid the constraints on thought and policy-making
which are to be found within some of those bodies.
The panel is designed primarily to contribute policy analysis and
formulation of use to the CSD, to help offset the lack of those
resources provided to this body. The CSD formally recognised the
utility of independent expert panels on “trade and environment” at
its third session.
The members of the panel have focused their work programme on
examining how environmentally damaging processing and production
methods (PPMs) and market access regulations can cause trade to
conflict with sustainable development objectives. The panel will
then develop integrated policy packages to redirect trade to support
sustainable development. Such packages could include, for
example, environmental policies, financial and trade measures and
technology transfer, which together shift trade flows onto a
sustainable footing.
Within this broad focus, the panel has chosen to work on specific
trade sectors, namely timber, textiles and electricity generation.
It is hoped that the work will lead to both generic policy
recommendations for the design of integrated policy packages, and
specific recommendations for individual sectors, fine-tuned in some
cases to specific locations. It is intended that the panel will
also address the role of foreign investment in sustainable
development, and has already begun to do so in the context of the
electricity sector.
The EPTSD is not so much a new institution as a new space, in
which the intricacies of the trade, environment and development
interface can be discussed, without national or institutional
constraints. The utility of its policy recommendations will depend
on the panelist’s expertise, freedom to innovate, and critically on
securing inputs from a broad cross-section of the official community
and civil society.
In
presenting the work of the panel, I am also asking you all to
contribute to it. While the panel cannot substitute for the many
national and multilateral policy and institutional reforms
necessary to direct trade and investment to support sustainable
development, it can with your help, inform, catalyse and accelerate
that reform process.
q
Aimee T. Gonzales
EPTSD Coordinator, Charles Arden-Clarke, Senior Policy Analyst, WWF
International, 1196 Gland, Switzerland.
For more information, comments or suggestions please contact:
Tel. +41 22 3649513 Fax +41 22 3645829
e-mail:
“aimee.gonzales@2wwfnet.org”
“caclarke@wwfnet.org”
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