International trade provides a central vehicle for expanding demand and supply of environmentally friendly goods and services and is vital for helping countries shift to “greener” development paths, experts said Wednesday at a panel discussion titled “Mainstreaming sustainability into trade and development policies: Towards the Rio +20 Summit.”
That will be the message UNCTAD sends to Rio +20, formally known as the United Nations Conference on Sustainable Development, scheduled for 20-22 June in Rio de Janeiro. The first “Earth Summit” was held in Rio in 1992.
Opening the panel debate on the fourth day of the UNCTAD XIII quadrennial conference here, UNCTAD Secretary General Supachai Panitchpadki recommended that two new initiatives be included in the follow up to Rio+ 20. One should address concerns about green “protectionism” by creating a “new institutional space, away from current trade negotiations and disputes, so evidence-based dialogue and solution sharing can be fostered,” he said. This initiative could be called the Global Trade and Green Economy Forum. A second initiative could assist developing countries in seizing the trade opportunities that will arise from the emerging global green economy by helping them to identify promising green export opportunities, he said.
Mr. Supachai said that while markets can help with the structural transformations needed to move towards a green economy, the role of governments as regulators and supporters of domestic industries remains essential. There is no single template for accomplishing the transition, he emphasized; “each country has to define its own path towards a green economy.” Trade can improve resource efficiency and spur the diffusion of “clean” technology by transmitting to businesses and developing countries the growing environmental and social preferences of firms and consumers in world markets, he said.
The critical issue is how economic growth can be pursued without increasing environmental risks, natural resource scarcities, social disparities, and poverty, panellists said.
“We are facing multiple challenges and crises that are clearly interconnected. Rio+20 should offer real opportunities to rethink the current perception of growth, consumption and production patterns, and well-being,” said Paul Magnette, Minister for Public Enterprises, Scientific Policy, and Development Cooperation of Belgium.
Hans Peter Egler, Head of the Division for Trade Promotion of the State Secretariat for Economic Affairs of Switzerland, said UNCTAD’s BioTrade programme, which helps win market access for developing country products made from the sustainable use of their biodiverse flora and fauna, is a good example of how open markets and changing consumer preferences can generate new business opportunities for participants in the green economy.
Elmer Schialer, Director of International Economic Negotiations of the Ministry of Foreign Affairs of Peru, described how the country’s biodiversity-based product exports had increased ten-fold over the last 10 years, reaching US$400 million in 2010. In the case of Indonesia, similar export values were achieved in relation to natural cosmetic products, he said. The involvement of local populations and small-scale producers with the support of the BioTrade Initiative has been a key driver for sustainable practices and has ensured equity and participation in such global value chains, he said.
National policies to support the green economy may be incompatible with multilateral trade rules, thus creating challenges, speakers noted. This lack of coherence can make it difficult for countries to establish effective green economy policies. Faisal Ismail, Ambassador of South Africa to the World Trade Organization, stressed the need to rebalance WTO rules so that they ease the transition towards a greener economy with tangible development gains for less-wealthy nations. Potential areas of review should include unilateral tax-border adjustments, technology transfer, flexibilities in trade-related aspects of intellectual property rights (TRIPS), and subsidy rules, he said.
Overall, panellists said that trade measures must be compatible with Rio principle 12, which calls on countries to refrain from using trade policy measures for environmental purposes as a way of arbitrarily or unjustifiably discriminating or restricting international trade. Alya Ahmed Saif Al-Thani, Ambassador of Qatar to the United Nations Office at Geneva, said that with open global markets and an enabling business environment, not only Qatar but all countries can find niche market opportunities allowing them to benefit from greener trade.
Participants described the negotiations leading up to Rio+20 as challenging because countries have different capacities for making the transition towards greener, more equitable economies. While most governments are positive about the benefits that can be realized, many remain genuinely concerned about the competitive disadvantages and potential market dislocations and social and financial hurdles that may arise from such a transition, speakers said.
Panellists concurred that a transition to a greener and more equitable economy is not a substitute for sustainability but an opportunity to make it a full part of the quest for development.