World Trade Organization
The negotiations in this international organization concern trade issues. It has adopted some agreements which have a bearing on the environment. These agreements give either incentives for the production and trade of environmentally friendly products or disincentives for the opposite. For example, under one of the WTO agreements, 20 per cent of the cost of adaptation to environmental requirements can be subsidized.
The Marrakesh Ministerial
Decision on Trade and Environment
WTO Trade Ministers meeting in Marrakesh agreed to establish a WTO Committee on Trade and Environment with a broad-based remit covering all areas of the multilateral trading system - goods, services and intellectual property. The Committee has been given both analytical and prescriptive functions: to identify the relationships between trade and environmental measures in order to promote sustainable development; and to make recommendations on whether any modifications to the provisions of the multilateral trading system are required.
Two important parameters have guided the Committee's work. One is that WTO competence for policy coordination in this area is limited to trade and those trade-related aspects of environment policies which may result in significant trade effects for its members. In other words, there is no intention that WTO should become an environmental agency, or that it should become involved in reviewing national environmental priorities, setting environmental standards or developing global policies on the environment; that will continue to be the task of national governments and of other intergovernmental organizations better suited to the task. The second parameter is that if problems of policy coordination to protect the environment and promote sustainable development are identified through the Committee's work, steps taken to resolve them must uphold and safeguard the principles of the multilateral trading system to which govern-ments agreed in the Uruguay Round negotiations.
While it is true that WTO cannot become directly involved in the formulation of the environment policy of national governments, it can indirectly influence these policies by setting certain standards for production processes etc. for goods and commodities traded in international markets. It can also facilitate the adherence of developing countries to these standards by providing them with certain monetary incentives.