8:33 AM Mar 7, 1994

ENVIRONMENT POLICY NEEDS MORE ANALYSIS

Geneva 4 Mar (Chakravarthi Raghavan) -- Any reconciliation of trade and environment policies to be mutually supportive needs more policy analysis and conceptual work and this should be undertaken by the UN Conference on Trade and Development.

This was one of the outcomes of the Third Session of the Ad Hoc Working Group on Expansion of Trading Opportunities for Developing Countries, according to the summing up of the results of the session by the Chairperson, Magda Shahin of Egypt.

Another was that commodity-dependent developing countries in particular continued to lack the financial, human and institutional resources necessary to carry out successful diversification programmes which were of crucial importance for their economic growth.

Environmental measures and regional integration arrangements were two of the specific themes in the discussions on the expansion of export market opportunities.

On the environment measures issue, the Chair's summing up also brought out that there was a need to inform the private sector in developing countries about the new measures and trends in the field of trade and environment in order to ensure an easier compliance with newly established requirements.

For example, the summing up added, while efforts should be devoted to making sure that packaging and eco-labelling programmes did not become a new trade barrier, especially for developing countries, these countries also needed support in order to exploit new trading opportunities arising from the certification of products as "environmentally friendly" and to establish their own national eco-labelling programmes.

At a recent UNEP/UNCTAD informal meeting of a group of environment ministers from the North and the South, UNCTAD Secretary-General Kenneth Dadzie had suggested a special form of certification for "environmentally friendly" products produced by the developing countries and of joint initiatives and actions being considered by UNEP and UNCTAD in this behalf.

Developing countries, the summing up added, also need to adopt environmental standards to forestall imports of environmentally unacceptable products and to avoid the dumping in their markets of goods no longer accepted in the countries of origin.

The need for transfer of technology to developing countries to enhance their capacity to produce environmentally friendly products and to promote their trading opportunities in respect of new products and services arising from environmental concerns was also emphasized.

In accord with the mandate of Agenda 21, UNCTAD had an important role to play in conceptualization and policy analysis regarding the interface between environmental measures and trade.

Furthermore, the need for greater coordination between UNCTAD and other relevant international bodies, in particular the International Trade Centre (ITC) was stressed. UNCTAD and ITC had complementary roles to play in information dissemination and technical assistance for exploiting the new trading opportunities arising from new environmental measures and standards -- UNCTAD at intergovernmental level and the ITC at operational level.

On the question of regional integration arrangements, the Chair's summing up noted the rapid expansion and intensification of regional integration arrangements throughout all regions, including faster extension of groupings formed around major trading nations, emergence of mixed arrangements between developing countries and their major trading partners and a revival of integration among developing countries.

All these would have important implications for both participating countries and third countries and more specifically for export opportunities of developing countries.

The export opportunities for developing and other countries outside of the arrangements were highly dependent on the openness of regional integration schemes. The elimination of intra-regional barriers should be accompanied by reduction or removal of barriers in trade with third countries and, hence, regional and multilateral approaches should be complimentary.

Inward orientation of regional arrangements however might affect adversely the trading opportunities of non-member countries.

Ideally, regional integration schemes consistent with the multilateral trading system would promote intra-regional trade and, through higher economic growth, also stimulate trade with third countries and, in this way, new export opportunities would be crated for economies inside and outside such arrangements.

The full and speedy implementation of the results of the Uruguay Round could make a significant contribution to enhancing the outward orientation of regional integration groupings.

The effect of integration schemes on export opportunities of developing countries also depended on the economic dynamism and competitive strength of the export supply capabilities of both participating countries and third-country trading partners.

The Ad Hoc Working Group is scheduled to hold a final meeting from 4-8 July for the purpose of evaluating the impact of the Uruguay Round on the trading opportunities of developed countries.