Environmental Law and Policy in Namibia: Towards Making Africa the Tree of Life (Third Edition)
TRADE, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Oliver C. Ruppel
1 Introducing the International Trade, Environment and Development Debate
Issues related to international trade and the environment undoubtedly are of significance to developing countries because they argue that developed countries have depleted resources and indulged in environmentally harmful practices during the past century, in order to achieve unprecedented high standards of living.1 The developing countries therefore demand a general but differentiated responsibility, seeking open trade and compensation for adopting environmentally restraining policies.2 Upon further reflection on the link between economic growth activities, environmental protection and social development, the triangular debate on these topics will be highlighted briefly, by introducing the various perspectives.3
1.1 The Trade Perspective
Trade creates the wealth, which increases human well-being. Trade can be good for the environment because it creates wealth that can be used for environmental improvement, and the efficiency gains from trade can mean fewer resources used and less waste produced. Increased economic growth leads to more environmental protection and a higher standard of living. The exchange of goods introduces new technologies, which reduce emissions and save raw materials and natural resources.
1.2 The Environmental Perspective
The environment actually represents a higher order than trade and the status quo seriously threatens the earth’s eco-systems. Developing countries try to protect themselves against costly environmental demands. In contrast, the wealth created by trade will not necessarily result in environmental improvements. Trade liberalisation is deemed to cause greater harm, leading to exports of natural resource allocation to other countries and thereby causing increased environmental degradation.4
1.3 The Development Perspective
Developing countries’ top priority should be to reduce poverty. Openness to trade (market liberalisation) and investment may be a key to doing so by increasing exports, even though the link between market liberalisation and economic growth does not happen automatically. Developed countries protect their industries with subsidies, special trade rules and tariff systems which place at a disadvantage exporters in developing countries. Demands that developing countries comply with the environmental standards of developed countries are unfair, particularly if they are not accompanied by technical or financial assistance. Priorities differ; in Africa, for example, clean water is paramount and, historically, developed countries caused most of the environmental damage in the first place.
1.4 Sustainable Development: The Answer to the Dilemma?
Principle 11 of the 1972 Stockholm Declaration states that
[t]he environmental policies of all States should enhance and not adversely affect the present or future development potential of developing countries, nor should they hamper the attainment of better living conditions for all, and appropriate steps should be taken by States and international organisations with view to reaching agreement on meeting the possible national and international economic consequences resulting from the application of environmental measures.
In its 1987 reportOur Common Future , the Brundtland Commission defined sustainable development as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs”.5 Since the 1992 UN Conference on Environment and Development in Rio de Janeiro, the principle of sustainable sevelopment has influenced a broad number of international instruments, both of legal and non-legal in nature.
It aims at embracing and balancing ecology, economy, conservation and utilisation and has become a worldwide governing politicalLeitmotiv for environment and development. It can be broadly understood as a concept that is characterised by (i) the link between the policy goals of economic and social development and environmental protection; (ii) the qualification of environmental protection as an integral part of any developmental measure, and vice versa; and (iii) the long term perspective of both policy goals, that is the States’ inter-generational responsibility.6
Apart from the question, whether the principle of sustainable development actually enfolds normative quality,7 the concept reflects the idea of distributive justice and can play an important role in the process of bridging the North-South divide in international and developmental relations.8 Sands formulated an “integration approach”, where economic and social development must be an integral part of environmental protection, and vice versa.9
Although many African countries are classified as least-developed countries, the southern African region is endowed with numerous natural resources, fisheries, and minerals. In turn, environmental challenges include among other things, land degradation, poor land use and land management, exploitation of natural resources, water scarcity, bio-diversity loss and climate change. In this regard poverty and challenges of governance often collide with different interests in society and political pressures.10
The former executive Director of the United Nations Environmental Programme (UNEP), Klaus Töpfer, stated that “sustainable development cannot be achieved unless laws governing society, the economy, and our relationship with the Earth connect with our deepest values and are put into practice internationally and domestically.” The problem continues to lie, however, in that such laws “must be enforced and complied with by all of society, and all of society must share this obligation”.11 But how can the law work for everyone equitably (developing and developed countries), reduce poverty, retain wealth and at the same time protect the environment?
The Commission on Legal Empowerment of the Poor came up with an analysis and a few reasonable suggestions in its 2008 report:
Though many have shared in this prosperity, far too many of the world’s people have been left behind, still living in deprivation, taking talent unused to the grave. Sub-Saharan Africa is not on track to achieve any of the Millennium Development Goals and extreme poverty on every continent. … The Commission argues that four billion people around the world are robbed of the chance to better their lives and climb out of poverty, because they are excluded. … The Commission believes poverty is manmade, by action and inaction, and a failure of public policies and of markets. The Commission sees that in rich countries people are more likely to enjoy access to justice and other rights – as workers, businesspeople, and owners of property. The recent, and vast, creation of wealth rests upon various legal protections, norms, and instruments governing such things as business organisations, corporations, tradable assets, labour contracts, workers associations, venture capital, insurance, and intellectual property. While the same protections and instruments exist in many developing countries, the overwhelming majority has no way to access them. …Because the poor lack recognised rights, they are vulnerable to abuse by authorities that discriminate, seek bribes, or take the side of powerful interests who may wish to prevent the poor from competing economically or seek to evict them from their land. …The majority of humanity is on the outside looking in, unable to count on the law’s protection and unable to enter national, let alone global markets. … Transforming a society to include the poor requires comprehensive legal, political, social, and economic reforms. In the short term, reform is unlikely to seem an easy option. … Legal empowerment is not a substitute for other important development initiatives, such as investing more in education, public services, and infrastructure, enhancing participation in trade, and mitigating and adapting to climate change: instead, it complements such initiatives, multiplying their impact by creating the conditions for success. … While the Government is the key responsible actor, the ‘duty bearer’ in human rights terms … the United Nations and the broader multilateral system can help by lending their full support. The international non-governmental community can do the same. More specifically global multilateral agencies such as the World Bank, UNDP, ILO, FAO and UN-HABITAT; regional political organisations, regional banks, and regional UN institutions; civil society and community-based organisations; the business community; religious communities and indigenous spiritual traditions; and various professional associations …. The world as a whole will benefit as more and more states undertake the reforms needed to empower the poor. Such initiatives will help to reduce the pressures created by refugee migrations, under-development, famines, environmental neglect, health emergencies, and strife. In an interdependent world, we will all do better if our neighbours are both able to count on the protections of law and expected to live up to their responsibilities under it. After all, our era is one of seismic shifts, not only in the economic order but also in the creation of a global public domain. Myriad ungoverned interactions flow between states, from the obvious to the near invisible, from the malign to the beneficent. Some must be curbed, some controlled, some eased and encouraged. Yet, as at the national level, our global institutions remain blind to much of reality, equipped rather for yesterday than today, hampering our attempts to grapple with each new problem we face. Who can deny that we all share a responsibility to protect: one which we are far from meeting? Whether for climate change, trade, migration, or security, the world will expect fair rules for the 21st century, rules offering protection and opportunity for all in accordance with shared human rights obligations.12
It is also important to acknowledge that not only rests the responsibility on national governments and international organisations but also on corporate businesses to enter into a new era of sustainable development. At the unveiling of the world’s first Integrated Reporting Guidance document in Johannesburg, South Africa on 25 January 2011, the Chairman of the South African Integrated Reporting Committee, Judge and Professor Mervyn King, rightfully stated as follows:
Companies don’t operate in a vacuum, they operate in the society we find ourselves in, and the situation we find ourselves in. And the one situation is the planet which is in crisis. We have used the natural assets of the planet faster than nature can regenerate them, so the great companies in the world … by means of integrated reporting need to tell their stakeholders in future more transparently how they had worked out a long-term strategy on sustainability issues.13
The importance of a harmonised interplay between trade and sustainable development is well reflected in the universally applicable (applicable to all countries, not just developing nations and emerging economies) sustainable development goals (SDGs) that have been proposed by the UN Open Working Group14 and which are universally applicable (to all countries, not just developing nations and emerging economies).
At the United Nations Sustainable Development Summit on 25 September 2015, world leaders adopted the 2030 Agenda for Sustainable Development, which includes a set of 17 Sustainable Development Goals (SDGs) to end poverty, fight inequality and injustice, and tackle climate change by 2030. The Sustainable Development Goals, otherwise known as the Global Goals, build on the Millennium Development Goals (MDGs), eight anti-poverty targets that the world committed to achieving by 2015. The MDGs, adopted in 2000, aimed at an array of issues that included slashing poverty, hunger, disease, gender inequality, and access to water and sanitation. Enormous progress has been made on the MDGs, showing the value of a unifying agenda underpinned by goals and targets. Despite this success, the indignity of poverty has not been ended for all.15
The new SDGs, and the broader sustainability agenda, go much further than the MDGs, addressing the root causes of poverty and the universal need for development that works for all people. All 17 Sustainable Development Goals are relevant to Namibia. SDG Number 1 on poverty and Number 10 on inequality are particularly central.
2 The Role of Trade for Sustainable Development and the Reduction of Poverty in Africa16
Human rights and good governance have an impact on the domestic investment climate, which contributes to growth, productivity and the creation of jobs, all factors essential for economic growth and sustainable reductions in poverty. The furtherance of economic development, reduction of poverty and the promotion of human rights in fact go hand in hand. The aforementioned relationship has grown closer over the past few years due to increasing discussions in the world community on related matters and issues. The connection can be seen as a two-way relationship insofar as economic development is obliged to respect human rights in a democratic society. Conversely, human rights can be given more effect through economic growth, as a possible outcome of economic growth is the increasing availability of resources, resulting in the reduction of poverty and a higher standard of living.17
States have committed themselves to respecting human rights by acceding to specific human rights treaties, conventions or declarations on the international, regional and sub-regional level; including the International Covenants on Civil and Political Rights and on Economic, Social and Cultural Rights and the African Charter on Human and Peoples’ Rights.18 On 10 December 2008, on the 60th Anniversary of the Universal Declaration of Human Rights, the United Nations adopted the Optional Protocol to the International Covenant on Economic, Social and Cultural Rights (ICESCR) bringing the possibility of international justice one step closer for millions of excluded people, groups, communities and peoples worldwide. The Optional Protocol is important because it promises to provide victims of economic, social and cultural rights violations that are not able to get an effective remedy in their respective domestic legal systems with an avenue for redress. Both human rights and good governance have an impact on the investment climate, which again contributes to productivity and the creation of jobs, all essential for economic growth, sustainable development and the reduction of poverty.19
The Committee on Economic, Social and Cultural Rights (CESCR) has stated that poverty has always been one of the central concerns of the Committee.20 Given the magnitude of the problem, it is often unrealistic for governments to tackle this daunting task without assistance. To achieve sustainable development a holistic approach must be adopted to deal with the concerns of the poor.21 A need exists for African governments to accelerate the process of creating enabling environments for the private sector to play an effective role in reducing poverty. To create such environments, countries and regions must ensure the efficient functioning of their markets, facilitate sufficient access of the poor to such markets and create the best possible conditions for competitiveness of their firms.22 In particular, enterprises in the informal sector are to be considered as part of the enterprise entity, which contributes to the development process.23
The evidence of African poverty and growth rates leaves little room for doubt about the need for financial assistance and an improved trade climate. China, for example, is providing substantial funds for investment and development in many African countries. China follows a ‘purely capitalist’ approach, not attempting to assist in the facilitation of social or political change through the pursuit of wealth and although this approach seems appealing to many African leaders,24 it is questionable because it does not attempt to improve social welfare in the targeted countries.25
Far more than any unconditional investment and development aid, trade can prove to be the catalyst, given favourable conditions, to uplift millions of people from poverty. African countries could gain disproportionately from further global trade reform but it is widely acknowledged that a level playing field does not yet exist in the current world trade system, at least not to the required extent. Developing countries still face numerous hurdles, including high tariffs against their exports and subsidised competition. Nevertheless, the participation of developing countries in the global trading system is the most effective way of encouraging development and helping to alleviate poverty. A key objective of the on-going round of WTO negotiations, the Doha Development Round, is to assist developing countries more fully to reap the benefits of international trade. The liberalisation of agriculture in particular is hoped to provide significant benefits to developing countries in Africa.26 Countries in Southern Africa are more or less in a permanent food security crisis, and policy formulation and response must be geared toward this reality on a continuing basis.27 When addressing the World Economic Forum in Cape Town on 10 June 2009 South African President Jacob Zuma had the following to say:
African agriculture has suffered for decades from the huge subsidies provided to developed country agriculture. The continent is rich in natural resources, including agricultural land. The continent has the opportunity to diversify markets and products, including building the requisite infrastructure and systems for intra-Africa trade.
In the aforementioned spirit, free trade agreements (FTAs) can also bring about economic benefits by reducing barriers to trade and investment between participating parties. They can open markets faster than would otherwise be possible through the WTO and build on the commitments already agreed in the WTO.28 Over two-thirds of WTO members are developing and least-developed countries. Members could gain access to a range of special provisions and assistance contained in the rules of the WTO. The WTO’s Committee on Trade and Development and its Sub-Committee on Least-Developed Countries monitor the implementation of provisions designed to assist developing and least-developed countries. The committees also monitor the substantial amount of training and technical assistance provided to developing countries by the WTO.29 Yet, the design of the multilateral trade regime needs to shift from one which overemphasises a market access perspective to one which prioritises enabling (or at least not disabling) the domestic policy space available to developing countries to make a range of diverse, including unorthodox, policy choices and pursue the concomitant strategies. It should also not be evaluated on the basis of whether it maximises the flow of goods and services, but on whether trade arrangements, current and future, maximise possibilities for human development, especially in developing countries. An implication is that multilateral trade rules will need to adjust ‘one-size-fits-all’ solutions that really only suit a few powerful members. The global trade governance framework requires additional asymmetric rules in favour of the weakest members. In the long run, such rules will be beneficial for both developed and developing countries.30 Trade rules therefore have to allow for diversity in national institutions and standards. Countries should have the right to protect their own institutions and development priorities where necessary, and no country has the right to impose its institutional preferences on others. In order to create a trade regime friendly to poverty reduction and human development, governments must have the space to design appropriate policies.31
Article 11 of the International Covenant on Economic, Social and Cultural Rights, is concerned with the right to food and advocates “taking into account the problems of both food importing and food exporting countries, to ensure an equitable distribution of world food supplies in relation to need. Between the weak and the strong, poor and the rich, liberty is the oppressor and the law is freedom.”32 Negotiating and implementing such rules is the WTO’s basic mission, and its primary vocation in so doing is to regulate, and not to deregulate, as is often thought. It also presupposes the existence of social policies, whether to secure redistribution or provide safeguards for the men and women whose living conditions are disrupted by changes in the international division of labour. It does not suffice unless it is accompanied by policies designed to correct the imbalances between winners and losers; and the greater the vulnerability of economies, societies or individuals, the more dangerous the imbalances. It does not suffice unless it goes hand in hand with a sustained international effort to assist developing countries to build the capacity required to take advantage of open markets.33 Lamy further pinpoints the importance of coherence, which he sees as:
... the political commitment of citizens, of civil society, of trade unions, between the local and the global. Today the world needs more coherence in the organisation of government between national and global, more coherence between the different islands making up the archipelago of international governance.34
In his remarks to the Trade Negotiations Committee on 19 October 2010 Lamy said that:
... the foremost challenge facing us all … is to take the Doha negotiations to a higher gear by going deeper and wider in the discussions, as a prelude for the give and takes that will be required to build a final package.35
This final package will hopefully reflect the beneficial role world trade could potentially play in sustainable development and the reduction of poverty in Africa. Trade can be a powerful source of economic growth. Trade liberalisation is not automatically or always associated with economic growth, let alone poverty reduction or sustainable development. Signing up to unbalanced agreements has the potential to lead to violations of economic and social rights of people.36 Recent Economic Partnership Agreements (EPA) negotiations between various states in Africa and the EU have proven that trade and investment liberalisation is not always linked with development strategies,37 let alone with mechanisms which guarantee labour and other human rights. Moreover, regional integration
... can only be meaningful if it facilitates the integration of existing economic blocs in Africa by promoting intra-regional trade and encouraging diversification and the establishment of linkages between production units across the continent, thus effectively creating a larger regional market. The resulting increased productivity and product competitiveness will place Africa on a better footing to participate gainfully in reciprocal inter-regional trade. To the extent that the current EPA process undermines Africa’s regional integration initiatives, it will not further the integration of African countries into world trade.38
3 Regional Integration and Natural resources in Southern Africa
The wealth of natural resources in southern Africa can only promote sustainable economic growth and contribute to poverty alleviation if there is an effective legal framework for environmental protection in place.39 The spirit of the Chapter is eloquently captured in the following message of United Nations Secretary-General, Ban Ki-moon (May 2011):
For most of the last century, economic growth was fuelled by what seemed a certain truth: the abundance of natural resources. The world mined its way to growth and burned its way to prosperity. Those days are gone. In the twenty-first century, supplies are running short and the global thermostat is running high. Climate change is showing us that the old model is more than obsolete. It is in fact extremely dangerous. How do we lay the foundation for future growth? How do we lift people out of poverty while protecting the planet and ecosystems that support economic growth? How do we regain the balance? All of this requires rethinking. We have to be prepared to make major changes – in our lifestyles, our economic models, our social organisation, and our political life. We have to connect the dots between climate change and issues such as water, energy and food. The challenge is great – but, so too, is the opportunity. The sustainable development agenda is the growth agenda for the twenty-first century.40
The United Nations General Assembly specifically proclaimed ‘poverty eradication as an overriding theme of sustainable development for the coming years.’41 Poverty is a major factor to consider when formulating workable legal frameworks. Thus far, Africa remains poor regardless of its high concentration of natural resources. Susswein identifies “ineffective and inefficient, as well as narrowly focused, economic and environmental policies” as the culprits in increasing poverty and environmental degradation.42
Endowment of SADC Countries with Natural resources
petroleum, diamonds, iron ore, phosphates, copper, feldspar, gold, bauxite, uranium
diamonds, copper, nickel, salt, soda ash, potash, coal, iron ore, silver
cobalt, copper, niobium, tantalum, petroleum, industrial and gem diamonds, gold, silver, zinc, manganese, tin, uranium, coal, hydropower, timber
water, agricultural and grazing land, diamonds, sand, clay, building stone
graphite, chromite, coal, bauxite, salt, quartz, tar sands, semiprecious stones, mica, fish, hydropower
limestone, arable land, hydropower, unexploited deposits of uranium, coal, and bauxite
arable land, fish
coal, titanium, natural gas, hydropower, tantalum, graphite
diamonds, copper, uranium, gold, silver, lead, tin, lithium, cadmium, tungsten, zinc, salt, hydropower, fish; note: suspected deposits of oil, coal, and iron ore
fish, copra, cinnamon trees
gold, chromium, antimony, coal, iron ore, manganese, nickel, phosphates, tin, uranium, gem diamonds, platinum, copper, vanadium, salt, natural gas
asbestos, coal, clay, cassiterite, hydropower, forests, small gold and diamond deposits, quarry stone, and talc
hydropower, tin, phosphates, iron ore, coal, diamonds, gemstones, gold, natural gas, nickel
copper, cobalt, zinc, lead, coal, emeralds, gold, silver, uranium, hydropower
coal, chromium ore, asbestos, gold, nickel, copper, iron ore, vanadium, lithium, tin, platinum group metals
Source: Compiled by author based on CIA World Fact Book athttps://www.cia.gov/library/publications/the-world-factbook/fields/2111.php
A sound legal framework can play a vital role in regulating sustainable poverty alleviation strategies across the region, but utmost success seems unattainable without national governments’ dedication to achieving the same goal. Regional integration is an essential precondition for more effective regional environmental policy because the environment knows no national boundaries. Regional integration is a path towards gradually liberalising the trade of developing countries and integrating them into the world economy.43 At first glance it appears that the promotion and protection of the environment is not within the focal range of a regional economic community (REC). However, environment related matters play a vital role. The relationship between environmental protection and economic development has become closer over the past few years due to increasing discussions in the world community on the issue.44 This connection can be seen as a two-way relationship insofar as economic development is obliged to respect the environment in a democratic society. Conversely, environmental protection can be given more effect through economic growth, as one outcome of economic growth is the increasing availability of resources, resulting in the reduction of poverty and a higher standard of living. Here the principle of sustainable development comes into play. On the one hand, Africa is endowed with natural resources, fisheries, and minerals.45 On the other, its environmental challenges include inter alia, climate change, land degradation, poor land use and land management, and over-exploitation of natural resources, water scarcity and loss of bio-diversity. In this regard poverty and challenges of governance often collide with different interests in society and political pressures.46
The role regional integration can for example play with regards to the impact of climate change is as multifaceted as the concept itself. With reference to the Cotonou Partnership Agreement it was proposed to define regional integration as “the process of overcoming, by common accord, political, physical, economic and social barriers that divide countries from their neighbours, and of collaborating in the management of shared resources and regional commons.”47 The process of regional integration is thus characterised by arrangements for enhancing cooperation through regional rules and institutions entered into by states of the same region.
The stimulation of growth and income levels, for example, potentially enable nations to have opportunities to generate additional resources to address environmental issues more effectively.48 Increasing awareness about the negative effects of climate change and ongoing communication among international institutions, as well as public dialogue, necessarily leads to revision of and amendment to traditional frameworks. These also lead to fruitful discussions, for example, on new trade and climate change related measures such as carbon labelling or similar standards or regulations or on the imposition of border carbon adjustments, a measure to impose border taxes on the embodied carbon of imported goods, set at the level of equivalent domestic taxes.
Regional integration furthermore provides an opportunity to enhance political stability by establishing regional organisations which play an increasing role in defusing conflicts within and between countries and in promoting human rights. In terms of climate change related matters, such organisations are of the utmost relevance, especially when it comes to climate change related disaster management and environmentally induced migration. In this context, regional integration may serve as a tool to maintain political stability by building trust, enhancing understanding between groups and deepening interdependence.
Regional cooperation in environmental related matters including knowledge and technology transfer is another important link between regional integration and environmental protection. Such cooperation can address further interrelated challenges of a trans-national dimension such as food security, biodiversity, natural resources, and disease and pest control. One example in this regard is the considerable hydroelectric, solar and wind energy potential that exists in Southern Africa. Since many African countries share relevant resources, such as cross-border river basins, a regional approach is best suited to attract respective investment.
In the light of the fact that the global village with international trade as one foundation has become a reality, it is commendable, that the ‘trade versus environment’ debate has shifted to one of mutual support between trade and environment, even though it might, at a first glance, appear to be a forced marriage.
4 The WTO and the Environment
In the first place, the WTO is concerned with reducing trade barriers and eliminating discriminatory treatment in international trade. However, nowadays world trade law is also framed by the concept of sustainable development. Although environmental issues have not been negotiated as a separate topic during the Uruguay Round, the agreement establishing the WTO (unlike the GATT) has anchored the objective of sustainable development and the need to protect and preserve the environment within its Preamble:
Recognizing that their relations in the field of trade and economic endeavour should be conducted with a view to raising standards of living, ensuring full employment and a large and steadily growing volume of real income and effective demand, and expanding the production of and trade in goods and services, while allowing for the optimal use of the world’s resources in accordance with the objective of sustainable development, seeking both to protect and preserve the environment and to enhance the means for doing so in a manner consistent with their respective needs and concerns at different levels of economic development.
Although this statement in the Preamble is more of a policy goal than a binding principle, it has significant weight in decision-making and dispute resolution and can make an important difference to the agreement’s operation in practice. The importance of the citation of sustainable development in the Preamble has, for example, been highlighted by the WTO’s Appellate Body in the so-called Shrimp – Turtle Case.49 Nowadays, world trade order is de facto closely related to international environmental policy and its institutions. Environmental degradation and pollution are largely induced by economic activities and international trade flows.
But what is the WTO’s relationship to the environment? At first glance, the WTO provides a forum for negotiating agreements aimed at reducing obstacles to international trade and ensuring a level playing field for all, thus contributing to economic growth and development.50 The WTO is not an environmental protection agency. So far, its competence in the field of trade and environment is limited to trade policies and to the trade-related aspects of environmental policies that have a significant effect on trade. However, in addressing the link between trade and environment, the two fields can complement each other. Overall, the GATT/WTO rules already provide significant scope for members to adopt national environmental protection policies. The right of governments to protect the environment is confirmed by WTO agreements under certain conditions. This is regulated by way of exceptions that allow governments under certain conditions to implement policies to protect the environment but which affect trade. Trade liberalisation for developing country exports, along with financial incentives and technology transfers, are necessary to help developing countries generate the necessary resources to protect the environment and work towards sustainable development. Improved co-ordination on trade- and environment-related issues at the national level between trade and environmental officials, as well as increased co-ordination at the international level, could enhance mutual support between the trade and environmental regimes.
4.1 The Primary Objectives of the WTO
Today, the WTO with its 161 members51 sees itself primarily as a forum for governments where international trade agreements are negotiated. The WTO provides a system of trade rules covering goods, services and intellectual property, as well as a legal and institutional framework for the implementation and monitoring of these agreements, and a venue for settling disputes arising from the interpretation and application of WTO agreements. Administering WTO trade agreements, monitoring national trade policies, providing technical assistance and training for developing countries and co-operating with other international organisations are further functions of the WTO.52 More specifically, the WTO’s main activities are:
- Negotiating the reduction or elimination of obstacles to trade (import tariffs, other barriers to trade) and agreeing on rules governing the conduct of international trade (e.g. anti-dumping, subsidies, product standards, etc.);
- administering and monitoring the application of the WTO’s agreed rules for trade in goods, trade in services, and trade-related intellectual property rights;
- monitoring and reviewing the trade policies of members, as well as ensuring transparency of regional and bilateral trade agreements;
- settling disputes among members regarding the interpretation and application of the agreements;
- building capacity of developing country Government officials in international trade matters;
- assisting the process of accession of some 30 countries who are not yet members of the organisation;
- conducting economic research and collecting and disseminating trade data in support of the WTO’s other main activities;
- educating the public about the WTO, its mission and its activities.53
The WTO’s founding and guiding principles remain the pursuit of open borders, the guarantee of the most-favoured-nation principle and non-discriminatory treatment by and among members, and a commitment to transparency in the conduct of its activities. The opening of national markets to international trade, with justifiable exceptions or with adequate flexibilities, will encourage and contribute to sustainable development, raise people’s welfare, reduce poverty, and foster peace and stability. At the same time, the liberalisation of markets must be accompanied by sound domestic and international policies which contribute to economic growth and development according to each member’s needs and aspirations.54
Again, the WTO is not an environmental protection agency. However the fields of trade and environment can complement each other. Trade liberalisation for developing country exports, along with financial and technology transfers, are necessary in helping developing countries generate the necessary resources to protect the environment and work towards sustainable development; coordinating trade and environment issues should be emphasised. An improved coordination at the national level between trade and environmental officials, as well as increased coordination at the international level could contribute to enhancing mutual supportiveness between the trade and environment regimes. The WTO’s primary mandate is not to protect the environment but to promote trade. Although the first paragraph of the WTO agreement explicitly refers to the objective of sustainable development, aspiring:
... both to protect and preserve the environment and to enhance the means for doing so in a manner consistent with their respective needs and concerns at different levels of economic development.55
However, WTO members should not operate on the assumption that the WTO itself has the answers to environmental problems. Trade regulations are not, and cannot be, a substitute for environmental regulations.
4.2 The 2001 Doha Declaration and the Environment
The 2001 Doha Declaration envisages trade, the environment and sustainable development to as mutually supportive. The declaration was adopted at the Doha Ministerial Conference in 2001 emphasising the relationship between existing WTO rules and specific trade obligations set out in multilateral environmental agreements (MEAs). The negotiations shall be limited in scope to the applicability of such existing WTO rules as among parties to the MEA in question. The negotiations shall not prejudice the WTO rights of any member that is not a party to the MEA in question; procedures for regular information exchange between MEA Secretariats and the relevant WTO committees, and the criteria for the granting of observer status; the reduction or, as appropriate, elimination of tariff and non-tariff barriers to environmental goods and services. The Committee on Trade and Environment was instructed, in pursuing work on all items on its agenda within its current terms of reference, to give particular attention to the effect of environmental measures on market access, especially in relation to developing countries, in particular the least-developed among them, and those situations in which the elimination or reduction of trade restrictions and distortions would benefit trade, the environment and development; the relevant provisions of the Agreement on Trade-Related Aspects of Intellectual Property Rights; and labelling requirements for environmental purposes. The importance of technical assistance and capacity building in the field of trade and environment to developing countries, in particular the least-developed among them was stressed.56
Agenda 21 promulgated that international trade and environmental laws should be mutually supportive. In this context, the relationship of the WTO rules and MEAs is not always clear.57 Of the many MEAs currently in existence, over 20 incorporate trade measures to achieve their goals. Such trade-restricting measures may conflict with WTO rules (this problem is reflected in the Chile – Swordfish case).58
The relationship is monitored by the Committee on Trade and Environment (CTE), which was established in April 1994. The CTE has the mandate to identify the relationship between trade measures and environmental measures in order to promote sustainable development, and making appropriate recommendations on whether any modifications of the provisions of the multilateral trading system are required. The CTE is composed of all WTO members and a number of observers from inter-governmental organisations. It reports to the WTO’s General Council. In November 2001, at the Doha Ministerial Conference, it was agreed to launch negotiations on certain issues related to trade and environment. These negotiations are conducted in a Committee established for this purpose, the Committee on Trade and Environment Special Session (CTESS).59
The relationship between MEAs and WTO regulation is mostly not so problematic in cases, where all WTO members concerned are at the same time parties to the specific MEA in question. Then the case can be dealt with under the general obligations of public international law. WTO regulations will in general terms not hinder Members, which are parties to an MEA to apply it accordingly. More problematic are cases in which one of the parties concerned is not a WTO member, respectively not a party to the MEA in question.60
4.3 The Committee on Trade and Environment
The WTO’s Committee on Trade and Environment (CTE) was established in 1994 by the Marrakesh Ministerial Decision on Trade and Environment.61 As subsidiary body of the General Council of the WTO, the CTE is responsible for implementing the mandate the council was given by the Decision on Trade and Environment. The CTE meets several times a year and membership is open to all WTO Members. Observer governments and observers from inter-governmental organisations are invited to participate in CTE meetings. Originally, the CTE was endowed with broad mandates “to identify the relationship between trade measures and environmental measures in order to promote sustainable development”, to
to to make appropriate recommendations on whether any modifications of the provisions of the multilateral trading system are required, compatible with the open, equitable and non-discriminatory nature of the system….62
The CTE wasinter alia mandated to discuss:
- the links between the multilateral trading system and MEAs; relations between the WTO and taxes applied for environmental protection;
- relations between the WTO system and prescriptions established for environmental purposes with regard to products, norms, technical regulations and prescriptions on packaging, labelling and recycling;
- provisions of the WTO relating to the transparency of trade measures applied to the environment and environmental measures that have an impact on trade;
- the interrelationship between dispute settlement mechanisms established by MEAs and those provided by the multilateral trading system;
- the effects of environmental measures on market access;
- intellectual property; and,
- the export of prohibited products.
Some of the items contained in the original ten items programme are being negotiated in the course of the Doha negotiations.63 Considering its mandates and the items of its work programme, the CTE is an important institution to find a balance between trade and environment in general, and more particularly between legal implications of the trading system and multilateral environmental agreements.
4.4 WTO Agreements and their Environmentally Relevant Provisions
4.4.1 The General Agreement on Tariffs and Trade (GATT)
The General Agreement on Tariffs and Trade (GATT) covers international trade in goods. The workings of the GATT agreement are the responsibility of the Council for Trade in Goods (Goods Council) which is made up of representatives from all WTO member countries. GATT 1994, Articles I and III deal with non-discrimination. One component of the principles of non-discrimination is the Most-Favoured-Nation (MFN) clause (Article I). It regulates that WTO members are bound to treat the products of other members not less favourable than accorded to the products of any other country. No country may give special trading advantages to another or to discriminate against it. This means that all members are on an equal footing, and all share the benefits of any move towards lower trade barriers. The MFN principle ensures that developing countries and others with little economic leverage are able to benefit freely from the best trading conditions, whenever and wherever they are negotiated. Another principle of non-discrimination is the National-Treatment (NT) Principle (Article III); it regulates that once goods have entered a market they must be treated no less favourably than equivalent domestically-produced goods. Non-discrimination in terms of environmental concerns ensures to prevent the abuse of environmental policies and of their usage as disguised restrictions on international trade.
Moreover GATT Article XI provides for an elimination of quantitative restrictions. Article XI has been violated in the context of a number of environmental disputes in which countries have imposed bans on the importation of certain products; it therefore has relevance for trade and environment discussions. Most importantly, Article XX grants general exceptions from the aforementioned GATT rules. Article XX(b) lists measures necessary to protect human, animal or plant life and health; Article XX(g) lists measures relating to the conservation of exhaustible natural resources. WTO members may be exempted from GATT rules in specific instances. However, measures must be necessary (necessity-test). If the conditions set by Article XX are fulfilled, they must still pass the test of the introductory clause (Chapeau) of Article XX. According to the Chapeau measures may not be pronounced as arbitrary and unjustifiable discrimination between countries where the same conditions prevail and they may not constitute a disguised restriction on international trade. GATT rules provide significant scope for members to adopt national environmental protection policies. GATT rules impose only one requirement in this respect, that of non-discrimination. WTO members are free to adopt national environmental protection policies provided that they do not discriminate between imported and domestically produced like products (NT principle), or between like products imported from different trading partners (MFN clause). Non-discrimination is one of the main principles on which the multilateral trading system is founded. It shall secure predictable access to markets, protect the economically weak from the more powerful, and guarantee consumer choice.64
4.4.2 The General Agreement on Trade in Services (GATS)
The General Agreement on Trade in Services (GATS) is among the World Trade Organisation’s most important agreements. The agreement, which came into force in January 1995, is the first and only set of multilateral rules covering international trade in services. It has been negotiated by the member governments, and sets the framework within which firms and individuals can operate. The GATS has two parts: the framework agreement containing the general rules and disciplines; and the national schedules which list individual countries’ specific commitments on access to their domestic markets by foreign suppliers.65 GATS contains a general exceptions clause in Article XIV, similar to that of GATT Article XX. In addressing environmental concerns, GATS Article XIV(b) allows WTO members to maintain policy measures inconsistent with GATS if this is necessary to protect human, animal or plant life or health. This must not result in arbitrary or unjustifiable discrimination and may not constitute disguised restriction on international trade. GATS Article XIV Chapeau is identical to that of GATT Article XX.
4.4.3 The Agreement on Technical Barriers to Trade (TBT)
The Agreement on Technical Barriers to Trade (TBT) attempts to ensure that regulations, standards, testing and certification procedures do not create unnecessary obstacles. Technical regulations and product standards may vary from country to country. Many differing regulations and standards make life difficult for producers and exporters. If regulations are set arbitrarily, they could be used as an excuse for protectionism.66 The TBT aims to avoid unnecessary obstacles to trade. Product specifications, whether mandatory or voluntary (known as technical regulations and standards), as well as procedures to assess compliance with those specifications (known as conformity assessment procedures), should not create unnecessary obstacles to trade. Article 2.2 provides for legitimate objectives for countries to pursue protection of human health or safety; protection of animal or plant life; and protection of the environment.
4.4.4 The Agreement on Sanitary and Phyto-sanitary Measures (SPS)
The Agreement on Sanitary and Phyto-sanitary Measures (SPS) deals with the following problem: How do we ensure that our country’s consumers are supplied with food that is safe to eat and safe by the standards considered appropriate? And at the same time, how can we ensure that strict health and safety regulations are not being used as an excuse for protecting domestic producers?67 The SPS Agreement is very similar to the TBT Agreement, but covers a narrower range of measures. It covers measures taken by countries to ensure the safety of foods, beverages and feedstuffs from additives, toxins or contaminants, or for the protection of countries from the spread of pests or diseases. It recognises the right of members to adopt SPS measures but stipulates that they must be based on a risk assessment, should be applied only to the extent necessary to protect human, animal or plant life or health, and should not arbitrarily or unjustifiably discriminate between countries where similar conditions prevail. The SPS objectives aim to protect human or animal life from risks arising from additives, contaminants, toxins or disease-causing organisms in their food, beverages and foodstuffs.
4.4.5 The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)
The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) introduced intellectual property rules into the multilateral trading system for the first time. Ideas and knowledge are an increasingly important part of trade. Most of the value of new medicines and other high-technology products are contained in the amount of invention, innovation, research, design and testing involved. Films, music recordings, books, computer software and on-line services are bought and sold because of the information and creativity they contain, not because of the plastic, metal or paper used to make them. In the past, products were traded as low-technology commodities now contain a higher proportion of invention and design in their value; for example, branded clothing or new varieties of plants. Creators can be given the right to prevent others from using their inventions, designs or other creations and to use that right to negotiate payment in return for others using them. These are intellectual property rights. They take a number of forms. For example books, paintings and films are protected under copyright; inventions can be patented; brand names and product logos can be registered as trademarks; and so on. Governments and parliaments have given creators these rights as incentive to produce ideas that will benefit society as a whole. The extent of protection and enforcement of these rights varies around the world; as intellectual property became more important in trade, these differences became a source of tension in international economic relations. New internationally agreed upon trade rules for intellectual property rights were seen as a way to introduce more order and predictability, and for disputes to be settled more systematically.68 TRIPS stipulates patents are available for inventions in all fields of technology. It however also regulates the permissible exceptions thereto in Section 5, Article 27.69
4.4.6 The Agreement on Subsidies and Countervailing Measures (SCM)
The Agreement on Subsidies and Countervailing Measures (SCM) disciplines the use of subsidies, and it regulates the actions countries can take to counter the effects of subsidies. Under the agreement, a country can use the WTO’s dispute-settlement procedure to seek the withdrawal of the subsidy or the removal of its adverse effects. Alternatively, a country can launch its own investigation and ultimately charge extra duty (countervailing duty) on subsidised imports found to be detrimental to domestic producers.70 The Agreement on Subsidies and Countervailing Measures applies to non-agricultural products and is designed to regulate the use of subsidies. Certain subsidies referred to as ‘non-actionable’ are generally allowed. Under Article 8 of the Agreement on non-actionable subsidies, direct reference had been made to the environment. Amongst the non-actionable subsidies that had been provided for under that Article were subsidies used to promote the adaptation of existing facilities to new environmental requirements (Article 8.2(c)). However, this provision expired in its entirety at the end of 1999. It was intended to allow members to capture positive environmental external factors when they arise.
4.4.7 The Agreement on Agriculture
The Agreement on Agriculture was negotiated in the Uruguay Round (1986-1994) and is a significant first step towards fairer competition and a less distorted sector. WTO Member governments agreed to improve market access and reduce trade-distorting subsidies in agriculture. It seeks to reform trade in agricultural products and provides the basis for market-oriented policies. In its Preamble, the Agreement reiterates the commitment of Members to reform agriculture in a manner which protects the environment. Under the Agreement, domestic support measures with minimal impact on trade (known as green box policies) are excluded from reduction commitments (contained in Annex 2 of the Agreement). These include expenditures under environmental programmes, provided they meet certain conditions. The exemption also enables members to capture positive environmental external factors.
4.4.8 The Environmental Goods Agreement
In 2014, various WTO members launched plurilateral negotiations for an Environmental Goods Agreement. The negotiations relate to promoting trade and investment that is needed to protect the environment, and to developing and disseminating relevant technologies.
The first phase of the negotiations aims to eliminate tariffs or customs duties on a range of environmental goods. The next phase could address the bureaucratic or legal issues that could cause hindrances to trade and environmental services.71 The talks aim at securing a tariff-cutting deal on selected environmental goods, and they build on a list72 of specific environmental goods put together by countries of the Asia-Pacific Economic Cooperation forum. Included are goods such as wind turbines, air quality monitors and solar panels. Meanwhile, several participating countries have presented indicative lists of product nominations related to cleaner and renewable energy, as well as energy efficiency, among others. The talks on an Agreement on Environmental Goods are ongoing and the outcomes remain to be seen. In any event, the talks will contribute to the movement of sustainable development and environmental concerns towards the centre of discourse among WTO members.
4.5 The WTO’s Dispute Settlement Body
The Dispute Settlement Body (DSB) is the WTO’s judicial body. The dispute settlement mechanism of the WTO, one of the pillars of the multilateral trading system, is governed by Articles XXII and XXIII of GATT, and the Dispute Settlement Understanding (DSU). In simplified terms, the full dispute settlement process can be subdivided in four phases:73 The process begins with consultations between the countries in dispute. If consultations fail, the process enters the second stage, the panel. Panels consist of three or five experts from different countries who examine the evidence and issue a report. The report becomes the Dispute Settlement Body’s (DSB) ruling or recommendation unless a consensus rejects it. The third stage of the dispute settlement process is an appeal to the Appellate Body, if so requested by one or both parties to the dispute. The respective appeals report has to be accepted or rejected by the DSB. The final stage is that of adoption and implementation of the DSB’s rulings and recommendations. The number of cases that went for dispute settlement has amounted to 500 as of 11 November 2015 with “just over half have reached the litigation stage, suggesting that the system’s requirement for the members concerned to try to find a solution by consulting with each other helps to avoid many cases entering the litigation phase.”74 The majority of cases relate to the European Union and the United States.
Historically, Africa’s involvement in the dispute settlement process of the WTO is rather small. Although the involvement of developing countries in WTO related cases has increased significantly and account for over 40% of the cases, it is mostly the large Asian and Latin American countries which are making use of the dispute settlement process. While African countries have been respondents in nine cases (Egypt in four cases and South Africa in five cases), no African country has so far initiated proceedings under the DSU.75 The participation as third party is slightly higher, as 18 African countries have participated in proceedings as third parties.76
The reasons for Africa’s minor role in the proceedings under the DSU are manifold.77 Although Africa’s share in world trade is growing,78 its share (2.8% of world exports and 2.5% of world imports in the decade from 2000 to 2010)79 is still small compared to that of other regions. With a narrow range of primary export products (mainly fuels and mining products),80 it is understandable that the participation of African countries in the dispute settlement system is currently limited.81
Further reasons for Africa’s limited participation through litigation under the DSU are the agreements granting preferential access to key trade markets, such as the Lomé Conventions and the Cotonou Agreement, European Partnership Agreements (EPAs) or the United States’ African Growth and Opportunity Act (AGOA). Moreover, African priorities at this stage are focused on market access negotiations rather than on taking disputes to the WTO’s judicial body. However, it is predictable that the African share of world trade will increase, and as such, there may be need to resolve disputes that arise. With increasing economic development and regional integration strengthening the position of African economies, combined with a growing base of legal expertise in trade related issues, the participation of African countries in the dispute settlement system will undoubtedly improve.
4.6 Some Environmental Case References
A few of the environment-related cases that have been brought before the GATT/WTO dispute settlement mechanism are listed below in brief.
4.6.1 United States – Canadian Tuna (1982)82
An import prohibition was introduced by the United States after Canada seized nineteen fishing vessels and arrested US-fishermen for harvesting Albacore tuna, without authorisation from the Canadian Government, in waters considered by Canada to be under its jurisdiction. The United States did not recognise this jurisdiction and introduced an import prohibition to retaliate against Canada under the Fishery Conservation and Management Act.
The Panel found that the import prohibition was contrary to GATT Article XI:1, and was not justifiable under Articles XI:2 and Article XX(g).83
4.6.2 Canada – Salmon and Herring (1988)84
Under the 1970 Canadian Fisheries Act, Canada maintained regulations prohibiting the exportation or sale for export of certain unprocessed herring and salmon. The United States complained that these measures were inconsistent with GATT Article XI. Canada argued that these export restrictions were part of a system of fishery resource management aimed at preserving fish stocks, and therefore were justified under Article XX(g).
The panel found that the measures maintained by Canada were contrary to GATT Article XI:1 and were justified neither by Article XI:2(b), nor by Article XX(g).85
4.6.3 United States – Tuna (Mexico) (1991, not adopted)86
The US Marine Mammal Protection Act (MMPA) required a general prohibition of the “taking” and importation into the United States of marine mammals, except when explicitly authorised. The Act governed, in particular, the taking of marine mammals incidental to harvesting, yellow fin tuna in the Eastern Tropical Pacific Ocean (ETP), an area where dolphins are known to swim above schools of tuna. Under the MMPA, the importation of commercial fish or products from fish which were caught using commercial fishing technology which results in the incidental killing or injury of ocean mammals in excess of US standards, were prohibited. In particular, the importation of yellow fin tuna harvested with purse-seine nets in the ETP was prohibited (primary nation embargo), unless the competent US-authorities established that the Government of the harvesting country had a programme regulating the taking of marine mammals, comparable to that of the United States, and the average rate of incidental taking of marine mammals by vessels of the harvesting nation was comparable to the average rate of such taking by US vessels. The average incidental taking rate (in terms of dolphins killed each time in the purse-seine nets) for that country's tuna fleet were not to exceed 1.25 times the average taking rate of US vessels in the same period.
Imports of tuna from countries purchasing tuna from a country subject to the primary nation embargo were also prohibited (intermediary nation embargo). Mexico claimed that the import prohibition on yellow fin tuna and tuna products was inconsistent with Articles XI, XIII and III. The United States requested the panel to find direct embargo was consistent with Article III and, the alternative, was covered by Article XX(b) and (g). The United States also argued that the intermediary nation embargo was consistent with Article III and, the alternative, wasjustified by Article XX(b), (d) and (g) because the tuna was caught in a manner harmful to dolphins.
The panel found that the import prohibition under the direct and the intermediary embargoes did not constitute internal regulations within the meaning of Article III, were inconsistent with Article XI:1 and were not justified by Article XX(b) and (g). Moreover, the intermediary embargo was not justified under Article XX(d). Allowing the American import measures, the import prohibition, would undermine the multilateral trading system.87
4.6.4 United States – Gasoline (1996)88
Following the 1990 amendment to the Clean Air Act, the US Environmental Protection Agency (EPA) promulgated the Gasoline Rule on the composition and emissions effects of gasoline, in order to reduce air pollution in the United States. The Gasoline Rule permitted only gasoline of a specified cleanliness (“reformulated gasoline”) to be sold to consumers in the most polluted areas of the country. In the rest of the country, only gasoline no dirtier than that sold in the base year of 1990 (“conventional gasoline”) could be sold. The Gasoline Rule applied to all US refiners, blenders and importers of gasoline. It required any domestic refiner which was in operation for at least six months in 1990 to establish an individual refinery baseline, which represented the quality of gasoline produced by that refiner in 1990. EPA also established a statutory baseline, intended to reflect average US 1990 gasoline quality. The statutory baseline was assigned to those refiners who were not in operation for at least six months in 1990, and to importers and blenders of gasoline. Compliance with the baselines was measured on an average annual basis.
Venezuela and Brazil claimed that the Gasoline Rule was inconsistent,inter alia , with GATT Article III, and was not covered by Article XX. The United States argued that the Gasoline Rule was consistent with Article III, and, in any event, was justified under the exceptions contained in Article XX(b), (g) and (d).
The panel found that the Gasoline Rule was inconsistent with Article III, and could not be justified under paragraphs (b), (d) or (g). The appeal on the panel’s findings on Article XX(g), the Appellate Body found that the baseline establishment rules contained in the Gasoline Rule fell within the terms of Article XX(g), but failed to meet the requirements of the Chapeau of Article XX.89
4.6.5 Chile – Swordfish (WTO/ITLOS, 2000)90
Swordfish migrate through the waters of the Pacific Ocean. During their extensive journeys, swordfish cross jurisdictional boundaries. For ten years, the European Community and Chile were engaged in controversy over swordfish fisheries in the South Pacific Ocean, resorting to different international law regimes to support their positions. However, the European Community decided in April 2000 to bring the case before the WTO, and Chile before the International Tribunal for the Law of the Sea (ITLOS) in December 2000.
With regard to the proceedings at the WTO on 19 April 2000, the European Community requested consultations with Chile regarding the prohibition on the unloading of swordfish in
Chilean ports established on the basis of the Chilean Fishery Law. The European Community asserted that its fishing vessels operating in the South East Pacific were not allowed, under Chilean legislation, to unload their swordfish in Chilean ports. The European Community considered that, as a result, Chile made transit through its ports impossible for swordfish. The European Community claimed that the above-mentioned measures were inconsistent with GATT 1994, and in particular Articles V and XI. On 12 December 2000, the Dispute Settlement Body (DSB) established a panel further to the request of the European Community. In March 2001, the European Community and Chile agreed to suspend the process for the constitution of the panel (this agreement was confirmed in November 2003).
Proceedings started on 19 December 2000 at the ITLOS by Chile and the European Community. Chile requested,inter alia , the ITLOS to declare whether the European Community had fulfilled its obligations under UNCLOS:
- Article 64 - calling for cooperation in ensuring conservation of highly migratory species;
- Articles 116-119 - relating to conservation of the living resources of the high seas;
- Article 297 - concerning dispute settlement; and
- Article 300 - calling for good faith and no abuse of right.
The European Community requested,inter alia , the Tribunal to declare whether Chile had violated:
- Articles 64, 116-119 and 300 of UNCLOS, as well as
- Article 87 - freedom of the high seas including freedom of fishing, subject to conservation obligations; and
- Article 89 - prohibiting any State from subjecting any part of the high seas to its sovereignty.
On 9 March 2001, the parties informed the ITLOS that they had reached a provisional arrangement concerning the dispute and requested that the proceedings before the ITLOS be suspended. This suspension was recently confirmed. The case therefore remains on the docket of the Tribunal.
4.6.6 United States – Shrimp: Initial Phase (1998)
To date, seven species of sea turtles have been identified worldwide. They spend their lives at sea, where they migrate between their foraging and their nesting grounds. Sea turtles have been adversely affected by human activity, either directly (exploitation of their meat, shells and eggs), or indirectly (incidental capture in fisheries, destruction of their habitats, pollution of the oceans). In early 1997, India, Malaysia, Pakistan and Thailand brought a joint complaint against a ban imposed by the United States on the importation of certain shrimp and shrimp products. The US Endangered Species Act of 1973 (ESA) listed as endangered or threatened the five species of sea turtles that occur in US waters and prohibited their take within the United States, in its territorial sea and the high seas. Pursuant to ESA, the United States required that US shrimp trawlers use ‘turtle excluder devices’ (TEDs) in their nets when fishing in areas where there is a significant likelihood of encountering sea turtles. Section 609 of Public law 101-102, enacted in 1989 by the United States, provided,inter alia , that shrimp harvested with technology that may adversely affect certain sea turtles may not be imported into the United States, unless the harvesting nation was certified to have a regulatory programme and an incidental take-rate comparable to that of the United States, or that the particular fishing environment of the harvesting nation did not pose a threat to sea turtles. In practice, countries having any of the five species of sea turtles within their jurisdiction and harvesting shrimp with mechanical means had to impose on their fishermen requirements comparable to those borne by US shrimpers, essentially the use of TEDs at all times, if they wanted to be certified and to export shrimp products to the United States.
The Panel considered that the ban imposed by the United States was inconsistent with Article XI and could not be justified under Article XX. The Appellate Body found that the measure at stake qualified for provisional justification under Article XX(g), but failed to meet the requirements of the Chapeau of Article XX, and, therefore, was not justified under Article XX of GATT 1994.91
4.6.7 United States – Shrimp: Implementation Phase (2001)
Malaysia introduced an action pursuant to Article 21.5 of the Dispute Settlement Understanding (DSU), arguing that the United States had not properly implemented the findings of the Appellate Body in the Shrimp – Turtle dispute. The implementation dispute revolved around a difference of interpretation between Malaysia and the United States on the findings of the Appellate Body. In Malaysia’s view, a proper implementation of the findings would be a complete lifting of the US ban on shrimps. The United States disagreed, arguing that it had not been requested to do so, but simply had to revisit its application of the ban. In order to implement the recommendations and rulings of the Appellate Body, the United States had issued Revised Guidelines for the Implementation of Section 609 of Public Law 101-162 Relating to the Protection of Sea Turtles in Shrimp Trawl Fishing Operations (the Revised Guidelines). These Guidelines replaced the ones issued in April 1996 that were part of the original measure in dispute. The Revised Guidelines set forth new criteria for certification of shrimp exporters. Malaysia claimed that Section 609, as applied, continued to violate Article XI:1 and that the United States was not entitled to impose any prohibition in the absence of an international agreement allowing it to do so. The United States did not contest that the implementing measure was incompatible with Article XI:1, but argued that it was justified under Article XX(g). It argued that the Revised Guidelines remedied all the inconsistencies that had been identified by the Appellate Body under the Chapeau of Article XX.
The implementation panel concluded that the protection of migratory species was best achieved through international cooperation. However, it found that the Appellate Body had instructed the United States to negotiate (not necessarily to conclude) an international agreement for the protection of sea turtles with the parties to the dispute. The panel found that the United States had indeed made seriousbona fide efforts to negotiate such an agreement and ruled in favour of the United States. Malaysia subsequently appealed against the findings of the implementation Panel. It argued that the panel erred in concluding that the measure no longer constituted a means of “arbitrary or unjustifiable discrimination” under Article XX. Malaysia asserted that the United States should have “negotiated and concluded” an international agreement on the protection and conservation of sea turtles before imposing the import prohibition. The Appellate Body upheld the implementation panel’s finding and rejected Malaysia’s contention that avoiding “arbitrary and unjustifiable discrimination” under the Chapeau of Article XX.92
4.6.8 Brazil – Measures Affecting Imports of Re-treaded Tyres (2007)93
On 20 June 2005, the European Community (EC) requested consultations with Brazil on the imposition of measures that adversely affect exports of re-treaded tyres from the EC to the Brazilian market. The EC would like to address the following measures:
- Brazil’s imposition of an import ban on re-treaded tyres;
- Brazil’s adoption of a set of measures banning the importation of used tyres, which are sometimes applied against imports of re-treaded tyres, despite the fact that these are not used tyres;
- Brazil’s imposition of a fine of 400 BRL per unit on the importation, as well as the marketing, transportation, storage, keeping or keeping in deposit or warehouses of imported, but not for domestically re-treaded tyres; and
- Brazil’s exemption of re-treaded tyres imported from other MERCOSUR94 countries from the import ban and from the above-mentioned financial penalties, in response to the ruling of a MERCOSUR panel established at the request of Uruguay.
The EC considers that the foregoing measures are inconsistent with Brazil’s obligations under Articles I:1, III:4, XI:1 and XIII:1 GATT 1994.
- Brazil justifies its foregoing by Articles XX(b) and (d), XXIV GATT 1994.
- Upon Brazil’s acceptance Argentina joined the consultations on 20 July 2005.
- Brazil justifies its foregoing by Articles XX(b) and (d), XXIV GATT 1994.
- On 6 March 2006, the European Communities requested the Director-General to compile the panel.
Did Brazil impose an import prohibition on re-treaded tyres inconsistent with Article XI:1 GATT 1994? The Panel found that the prohibition on granting of import licences is an import prohibition inconsistent with the requirements under Article XI:1 GATT 1994.
Was Brazil's import prohibition justified under Article XX(b) GATT 1994 to protect human, animal or plant life or health? Risks are posed to human life or health by the accumulation of waste tyres. The accumulation of waste tyres cause mosquito-borne diseases and tyre fires cause toxic emissions. The Panel finds that risks posed by mosquito-borne diseases such as dengue, yellow fever and malaria to human health and life exist in Brazil in relation to the accumulation as well as transportation of waste tyres. The existence of risks to human life and health fall within the meaning of Article XX(b) GATT. The Panel found that Brazil’s policy of reducing exposure to the risks to human, animal or plant life or health arising from the accumulation of waste tyres – the import ban – falls within the range of policies covered by Article XX(b).
Was the measure ‘necessary’ within the meaning of Article XX(b)? The necessity of a measure should be determined through “a process of weighing and balancing a series of factors”:
- the relative importance of the interests or values furthered by the challenged measure;
- the contribution of the measure to the realisation of the ends pursued by it;
- restrictions on international commerce.
Comparison is to be undertaken between the challenged measure and possible alternatives. The Panel’s decisions on necessity are affirmative. The prohibition on the importation of re-treaded tyres contributes to the objective pursued by Brazil, as it can lead to a reduction in the overall number of waste tyres generated in Brazil because re-treaded tyres have a shorter lifespan than new tyres. This can in turn reduce the potential for exposure to the specific risks to human, animal, plant life and health. The Panel is of the view that alternative measures to the import ban (measures to reduce the number of waste tyres; measures to improve the management of waste tyres; other disposal methods e.g. land filling; stockpiling) are not reasonably available to Brazil in light of the level of protection Brazil pursues in relation to the health risks concerned. Stockpiled waste tyres pose similar types of risks such as mosquito-borne diseases and tyre fires to those posed by the accumulation of waste tyres in general and thus cannot constitute an alternative to the import ban.
When considering the Chapeau of Article XX, was the import ban on re-treaded tyres applied in a manner that resulted in discrimination? The Panel has determined that discrimination arises in the application of the measure at issue from two sources:
The MERCOSUR exemption can be considered to form part of the manner in which the import ban imposed by Brazil on re-treaded tyres, the measure provisionally justified under Article XX(b), is applied and that it gives rise to discrimination within the meaning of the Chapeau of Article XX, between MERCOSUR and non-MERCOSUR countries.
The importation of used tyres under court injunctions: in the case at hand, re-treaded tyres may beproduced in Brazil from importedcasings (while re-treaded tyres using the same casings cannot be imported). Court injunctions permitted imports ofused tyres. This results in discrimination in favour of tyres re-treaded in Brazil using imported casings, to the detriment of imported re-treaded tyres. Discrimination also arises from the importation of used tyres under court injunctions.
Was the discrimination in the application of the measure arbitrary / unjustifiable under the Chapeau of Article XX? Arbitrary means dependent on will or pleasure, based on mere opinion or preference as opposed to the real nature of things, capricious, unpredictable, inconsistent, unrestrained in the exercise of will or authority; despotic, tyrannical. Unjustifiable means, not justifiable, indefensible. The Panel’s decision on arbitrary or unjustifiable discrimination was as follows:
- The MERCOSUR exemption did not constitute arbitrary or unjustifiable discrimination. The Panel found, that, as of the time of the its ruling, the operation of the MERCOSUR exemption has not resulted in the measure being applied in a manner that would constitute arbitrary or unjustifiable discrimination
- The importation of used tyres through court injunctions was, however, considered to be unjustifiable. The Panel found that since used tyre imports have been taking place under the court injunctions in such amounts that the achievement of Brazil’s declared objective is being significantly undermined, the measure at issue is being applied in a manner that constitutes a means of unjustifiable discrimination.
Did the discrimination in light of the Chapeau of Article XX occur between countries where the same conditions prevail? The Panel concluded that since used tyre imports have been taking place under court injunctions at such frequencies that the achievement of Brazil's declared objective is being significantly undermined, the measure at issue is applied in a manner that constitutes a means of unjustifiable discrimination where the same conditions prevail.
Was the measure applied in a manner that constituted a disguised restriction on international trade under the Chapeau of Article XX? The imports of used tyres through court injunctions constituted such disguised discrimination. Since imports of used tyres take place in significant amounts under court injunctions to the benefit of the domestic re-treading industry, the import ban on re-treaded tyres is applied in a manner that constitutes a disguised restriction on international trade.
The MERCOSUR exemption did not constitute disguised discrimination. The MERCOSUR exemption, although it also has the potential to similarly undermine the achievement of the stated objective of the measure, has not been shown to date to result in the measure at issue being applied in a manner that would constitute such a disguised restriction on international trade. In conclusion, the Panel found that the importation of used tyres through court injunctions results in the import ban being applied in a manner that constitutes a means of unjustifiable discrimination and a disguised restriction to trade within the meaning of the Chapeau of Article XX. In light of this conclusion, the Panel found that the measure at issue was not justified under Article XX GATT 1994.
4.6.9 China – Measures Related to the Exportation of Various Raw Materials
The case was initiated by a request for consultations by the United States on 23 June 2009,95 deals with China's restraints on the export from China of various forms of raw materials. The consultations have been joined by Canada,96 the European Communities,97 Mexico98 and Turkey.99 The dispute deals with certain measures imposed by China affecting the exportation of certain forms of bauxite, coke, fluorspar, magnesium, manganese, silicon carbide, silicon metal, yellow phosphorous, and zinc. China is a leading producer of each of the raw materials which are used to produce everyday items as well as technology products. Four types of export restraints imposed on the different raw materials at issue have been challenged, namely export duties, export quotas, minimum export price requirements, and export licensing requirements. The DSB established a panel and Argentina, Brazil, Canada, Chile, Colombia, Ecuador, the European Union, India, Japan, Korea, Mexico, Norway, Chinese Taipei, Turkey and Saudi Arabia reserved their third-party rights. The United States considered that China was in
violation of Articles VIII, X, and XI of the GATT 1994; and several provisions of the Protocol on the Accession of the People's Republic of China (the Accession Protocol) by imposing temporary duties on exports of bauxite, coke, fluorspar, magnesium, manganese, silicon metal, and zinc; and by furthermore subjecting exports of yellow phosphorus to a duty in excess of thead valorem rate listed for item No. 11 in Annex 6 to theAccession Protocol . The European Union claimed that China has violated the obligation assumed under the note to Annex 6 to consult “with other affected WTO Members prior to the imposition” of the export duties on bauxite, coke, fluorspar, magnesium, manganese, silicon metal, and certain forms of zinc.
Article XX of the GATT 1994 and in particular its provisions relating to environmental matters play a major role in this case. China100inter alia argued that the export duty applied to fluorspar was justified pursuant to Article XX(g) because it is a measure relating to the conservation of an exhaustible non-renewable mineral resource, and is applied together with restrictions on domestic production and consumption. The export duties applied to coke, magnesium metal, and manganese metal are justified pursuant to Article XX(b) because they are necessary for the protection of human, animal, and plant life or health by virtue of their contribution to the reduction of the polluting and energy-intensive production of coke, magnesium metal, and manganese metal.
On 5 July 2011, the panel101 ruled in favour of the claimants and found that the wording of the Accession Protocol did not allow China to use the general exceptions in Article XX of the GATT 1994 to justify its WTO-inconsistent export duties and that even if China were able to rely on certain exceptions available in the WTO rules to justify its export duties, it had not complied with the requirements of those exceptions. The panel recommended that China bring its export duty and export quota measures into conformity with its WTO obligations such that the series of measures do not operate to bring about a WTO-inconsistent result.
Upon appeal the Appellate Body102 upheld the Panel's finding that there is no basis in China's Accession Protocol to allow the application of Article XX of the GATT 1994 to China's obligations under Paragraph 11.3 of the Accession Protocol. The Appellate Body report and the panel report, as modified by the Appellate Body report have been adopted by the DSB103 and China informed the DSB of its intention to implement the rulings and recommendations and rulings.
4.6.10 China – Measures Related to the Exportation of Rare Earths, Tungsten and Molybdenum104
On 13 March 2012, the US,105 Japan106 and the EU107 requested consultations with China under the WTO’s dispute settlement system. Canada has also requested to join the consultations.108 The case deals with China’s restrictions on the export of various forms of rare earths,109 as well as tungsten and molybdenum. Rare earths feature unique magnetic, heat-resistant and phosphorescence properties and are used, inter alia, to produce highly efficient magnets, phosphors, optical and battery materials. These materials are key components of products such as helicopter blades; wind-power turbines; energy-efficient light bulbs; motors for electric and hybrid vehicles; flat screens and displays; hard drives; medical equipment; and many others. Although reserves of rare earth elements are dispersed throughout the world with China holding only 50% of the world’s reserves, China has a near-monopoly position with more than 97% of the world’s rare earth production.110 The country has curbed output and exports since 2009 to conserve mining resources and protect the environment. The complaint relates to China’s restrictions in the form of export duties; export quotas; minimum export price requirements; export licensing requirements; and additional requirements and procedures in connection with the administration of the quantitative restrictions. The complainants claim that China’s measures are inconsistent with articles VII, VIII, X and XI of GATT 1994 and several provisions of China’s Protocol of Accession. It is argued that China administers export restrictions on various forms of rare earths, tungsten, and molybdenum, and that the requirements and procedures in connection with these export restrictions are administered in a manner that is not uniform, impartial, reasonable, or transparent.
On 29 August 2014, the DSB adopted the Panel and Appellate Body reports, which found that China’s export restrictions on rare earths, tungsten and molybdenum were in breach of China’s WTO obligations and were not justified under the GATT exceptions.
4.7 The WTO and the North-South Divide
Helping developing and least-developed countries secure a share in the growth of international trade commensurate with the needs of their economic development has steadily gained importance in recent years. Developing and least-developed country members can gain access to a range of special provisions and assistance contained in the rules of the WTO – in general, referred to as special and differential treatment. The WTO provides no explicit definition as to which country is considered to be a developing country. The status of a member as a developing country is to a large extent based on self-selection and members announce whether they consider themselves developing countries. In some cases, the developing country status is part of the accession negotiations.111 Least-developed countries, being those that have been designated as such by the United Nations,112 benefit from additional special and differential treatment.
Altogether, over two-thirds of WTO members are developing and least-developed countries. In recent years, they have participated more actively and efficiently in WTO negotiations and decision-making. In the course of recent negotiations, developing countries, including least-developed countries, have been able to make their voice heard and their concerns considered.113 Developing countries are represented in several (sometimes overlapping) negotiating groups, such as the African group or the group of least-developed countries. These groups aim to speak with one voice using a single co-ordinator or negotiating team and have gained in influence in WTO negotiations and decision-making. The standard procedure for decision-making in the WTO is based on consensus. Under WTO rules, this means that “the body concerned shall be deemed to have decided by consensus on a matter submitted for its consideration, if no Member, present at the meeting when the decision is taken, formally objects to the proposed decision.”114 Where consensus is not possible, the WTO agreement allows for taking decisions by voting on the basis of one country, one vote, and with a vote being won with a majority of the votes cast. This, however, is implemented only very exceptionally.
There is a broad variety of provisions granting special and differential treatment to developing countries.115 GATT for example contains a special section on trade and development. In very general terms, the WTO framework includes provisions allowing developed countries to treat developing countries more favourably than other WTO members, and provisions granting extra time for developing countries to fulfil their commitments under certain WTO agreements. Other provisions are designed to increase developing countries’ trading opportunities through greater market access, or require WTO members to safeguard the interests of developing countries when adopting domestic or international legislation. Moreover, provisions on technical assistance for developing countries are part of WTO efforts in favour of developing countries. Legal assistance and training of Government and other officials are special fields of support to developing countries In sum, it can be stated that the WTO’s legal framework contains numerous provisions for special and differential treatment for developing countries. Technical support forms an important pillar for dealing with the special needs of developing countries.
Concerns have been raised with regard to the effectiveness of the numerous provisions on special and differential treatment for developing countries, which have been considered as best-endeavour provisions that are not enforceable.116 Nevertheless, some of the developing countries do play an increasingly important and active role in the WTO as they become more important in the global economy. Integrating developing economies into the global trading system is an important and controversially discussed issue at multilateral trade negotiations, and remains one of the challenges facing the WTO. As to the challenges between sustainable development and trade, these are notably driven by advanced economies as well as civil society. For the time being, developing countries are wary of potential agreements on trade and the environment. The on-going negotiations on climate change are exemplary in this regard.
A very important factor in the current discussions on development, and on special and differential treatment in the WTO, is the Doha Development Round of negotiations. It was officially launched at the WTO’s Fourth Ministerial Conference in Doha, Qatar, in November 2001 and is currently at a crossroads. One fundamental objective of the Doha Development Agenda is to improve the trading prospects of developing countries. Although its future remains uncertain owing to controversies among members on many items on the agenda, one major step forward was the Bali Package concluded at the Ninth Ministerial Conference of the WTO in December 2013. The main issues of this conference included measures to support least-developed WTO member countries and a review mechanism for the special and differential treatment provisions applicable to least-developed countries and developing countries in all WTO agreements. Part II of the Bali Package relates to the work under the Doha Development Agenda. With regard to development and least-developed country issues, Part II of the Bali Package includes among others preferential rules of origin for least-developed countries; duty-free and quota-free market access for least-developed countries; and a monitoring mechanism on special and differential treatment. These are important achievements with regard to the Doha Development Round. However, an enormous amount remains to be accomplished (especially an encompassing agreement on agriculture) and the implementation of decisions remains a major challenge. As it is not unlikely that some issues, and in particular the issue of agriculture, is not going to be resolved in the current round, the focus of attention is shifting to mega-regional trading arrangements.
It is hoped that the outcomes of the on-going Doha negotiations will reflect the beneficial role that world trade could play in sustainable development and the reduction of poverty. A key objective of the on-going round of WTO negotiations is to assist developing countries more fully in reaping the benefits of international trade. The liberalisation of agriculture, in particular, is hoped to provide significant benefits to developing countries. Trade can be a powerful source of economic growth. But trade liberalisation is not automatically or always associated with economic growth – let alone poverty reduction or sustainable development.
In December 2013, WTO members concluded negotiations on a Trade Facilitation Agreement at the Bali Ministerial Conference, as part of a wider ‘Bali Package’. Since then, WTO members have undertaken a legal review of the text. In line with the decision adopted in Bali, WTO members adopted on 27 November 2014 a Protocol of Amendment to insert the new Agreement into Annex 1A of the WTO Agreement. The Trade Facilitation Agreement will enter into force once two-thirds of members have completed their domestic ratification process. The Trade Facilitation Agreement is expected to provide significant advantages for developing countries to couple intra-regional trade with infrastructure development efforts and to boost considerable growth potential that has so far largely remained untapped in Africa.117
4.8 Climate Change and WTO Law118
As a general message from the recently published Fifth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC), there is no doubt that we live in a world altered by climate change – one of the greatest challenges of the twenty-first century. Climate change poses risks to human and natural systems and has the potential to impose additional pressures on various aspects of human security.119 The risks and impacts related to climate change can be reduced by improving society in ways that decrease its vulnerability and lower the overall risk level (adaptation), and by reducing the amount of climate change that occurs (mitigation).
Developing global strategies for the sustainability of ecosystems in the face of human-induced impacts will be one of mankind’s greatest tasks, requiring new and intensive research efforts. It will pose many challenges to international law and global governance. A strong legal framework embedded in more effective global institutions will be required in future. International law, politics and social sciences – traditionally viewed as separate academic disciplines – need to become part of a more integrated, coherent, interdisciplinary and holistic interplay if they are to get a grip on climate change, arguably the most significant challenge of our time.
Environmental threats such as climate change have the potential to impose additional pressures on various aspects of human security. Intersecting with each other, these pressures include water stress and threats to land use and food security, health security, and environmentally induced migration, among others. Adverse climate events not only deepen poverty vulnerability in developing countries,120 they impact on all aspects of human security either directly or indirectly.
Ultimately, environmental damage may significantly affect economic growth and hamper sustainable development.121 For example, climate extremes exert substantial stress on low-income populations in particular. The poor are most vulnerable to multiple dimensions of climate change such as heat waves, sea level rise, the destruction of coastal zones and water shortages due to drought.122
The international trade regime under the WTO is also strongly related to the international climate change regime. In fact, both regimes recognise that climate change may provide opportunities as well as challenges for international development.123 The WTO is a remarkable example of institutional evolution and its dispute settlement system is as effective as it is impartial. However, similar to the international climate change negotiations, the Doha Development Round of multilateral trade negotiations have been complex and without sufficient success so far. Both negotiation processes seem to lack the necessary consensus of the parties involved. The only difference between the two negotiation processes lies in the fact that “the climate doesn’t have time for a Doha-like approach.”124
With regard to the persistence of global poverty and socio-economic inequalities, international trade rules often allow affluent countries to continue to protect their markets – with tariffs, quotas, anti-dumping duties, export credits and huge subsidies to domestic producers. This is at the expense of potential agricultural and textile exports from developing countries.125 International trade should therefore be considered as a means to an end, but not as the end in itself. An effective international trade regime must first and foremost be friendly to the environment, poverty reduction and sustainable development.126 Increasing awareness of the negative effects of climate change, and continuing communication among international institutions, as well as public dialogue, necessarily lead to rethinking and eventually to the adjustment of traditional frameworks. These also lead to fruitful discussions – for example, on new trade and climate-change-related measures, such as carbon labelling or similar standards or regulations on the imposition of border carbon adjustments, which impose border taxes on the embodied carbon of imported goods, set at the level of equivalent domestic taxes.127
World trade law “can both constrain and enable climate action”.128 It has the potential to promote community goals, namely the enhancement of economic development. However, a closer look at world trade law
sadly shows that accordingly solidarity is poorly implemented. The flaw is not in WTO law itself: WTO law allows developed countries to act in favour of developing countries.
But developed countries can choose not to implement relevant exceptions and too often implement them poorly.129
Moreover, both the policy-making and academic communities have been focusing on the role of the WTO.130 There has been much discussion on the ways in which the WTO exerts a negative influence on climate law and policy. This includes its potential ‘chilling’ effect on climate treaties, referring to the fact that parties to the climate regime have refrained from adopting multilateral trade measures (for instance, against non-compliers or non-parties).131 While WTO law may thus seem to constrain climate ambitions, attention has increasingly shifted to ways in which the organisation might contribute to climate change mitigation. One of these options is to pursue the reduction of fossil fuel subsidies,132 as called for by the G20 in 2010.133
Aiming to achieve a global agreement on aviation emissions, the European Union (EU) has since the beginning of 2012 included emissions from international aviation in the EU Emission Trading System (EU ETS), which applies to EU and non-EU airlines alike.134 The independent action by the EU sought to tackle international aviation emissions by including aviation in the EU ETS from 2012. In that year, an EU-wide cap on aviation emissions was set at 97% of the average annual emissions for the years 2004–2006. 85% of the emissions cap is given to airlines free of charge based on reported payload for 2010. 15% of the emissions cap is available through auctioning while additional allowances to cover growth have to be purchased from other sectors (open trading). With certain exceptions, the aviation ETS concerned all aircraft operators of all origins operating flights to, from and within the EU. The new EU ETS regulation restricting EU ETS to intra-European flights for the period 2013-2016 came into force on 30 April 2014.135 It has given rise to a boiling international dispute in which the EU has been accused of using unilateral trade measures, and of exercising extraterritorial jurisdiction in violation of international law,136 and of failing to reflect adequately the principle of common but differentiated responsibilities and respective capabilities in the design of its aviation scheme.137
Similar opposition is to be expected if the EU applies measures to emissions from international shipping. These are estimated to be responsible for 2.7% of the global CO² emissions in 2007.138 Since the International Maritime Organisation (IMO) is struggling to agree upon global action on measures such as a levy on CO² emissions or a cap-and-trade scheme for curbing emissions from shipping, the European Commission is considering including maritime transport emissions in the EU’s greenhouse gas reduction commitment.139 It becomes clear that powerful states can turn to unilateral action, rather than co-operation, to achieve their foreign policy goals.140 This in turn reflects that the international system is still characterised “by gross inequalities in power.”141
While the question of response measures remains sensitive in United Nations Framework Convention on Climate Change (UNFCCC) negotiations, the forum could provide for a multilateral dialogue to examine the implications of unilateral climate action designed to promote the ultimate objective of the UNFCCC. In some cases, the WTO dispute settlement mechanism could also enter the scene if the measure in question falls under WTO agreements:
In all cases, however, the focus should shift from the relatively simplistic choice between multilateral action, unilateral action or no action towards exploring ways in which interaction between a plural mix of legal regimes and jurisdictions in a global context can best serve the ultimate objective of the UNFCCC to avoid dangerous anthropogenic climate change.142
Thus, more international co-operation in economic areas is necessary to ensure more coherence and global welfare.143 As stated by Delbrück:
[I]t is not surprising that given the broad scope of subjects covered by international economic law in general and the law of the WTO in particular – cooperation in these fields show the variety of modes and mechanisms to implement obligations to cooperate.144
After all, while world trade has, no doubt, contributed significantly to greenhouse gas emissions, it also offers a variety of options in terms of new technologies and services, which will be crucial in mitigating further climate change.
5 Multilateral Environmental Agreements (MEAs) and the Multilateral Trading System
International environmental treaties or Multilateral Environmental Agreements (MEAs) as they are commonly referred to, regulate the relationships between states pertaining to the environment. Generally, the first objective of any MEA is the protection and conservation of the environment. International trade agreements focus on the exchange of goods, services and capital across international borders. That there isde facto a close interrelationship between trade and the environment can be taken from the respective legal documents: Environmental agreements contain trade measures and trade agreements provide for measures for environmental protection, as has been sketched in the previous section. This close relationship and a call for mutual supportiveness of trade and environment agreements with a view to achieving sustainable development has been emphasised by Chapter 2 of Agenda 21 and various environmental and trade agreements.
Different trade measures are provided for in MEAs, which are taken to protect the environment and have an impact on international trade flows. The most direct such measure is to prohibit or restrict trade in certain goods or products. Trade measures may be imposed in different forms, such as import or export licences, product standards, labelling, certification systems, notification procedures, taxes or subsidies. By applying trade measures, environmental agreements typically either aim to control and monitor trade activities with regard to the over-exploitation of natural resources, or to combat trade activities considered being sources of pollution.
The 1973 Convention on International Trade in Endangered Species (CITES) for example contains several trade measures to control the trade of species in danger of extinction or which might become endangered. The species to which the trade measures are applicable are specified in the annexes to CITES. Trade measures here include export and import licenses, quotas and certificates on the country of origin.
The 2000 Cartagena Protocol on Bio-Safety, agreed upon by the Parties to the 1992 Convention on Biological Diversity, is another important example of MEAs that have an impact on international trade flows. The Protocol provides for specific steps states may take to regulate trade in genetically modified organisms (GMOs) in order to ensure safety of international transfers and of the use of any living GMOs resulting from biotechnology as trans-boundary movements of GMOs may have adverse effects on the conservation of biological diversity. The import of living GMOs may thus be restricted as part of a detailed risk management procedure. The Protocol establishes trade control measures based on a compulsory procedure of notification by the exporting country.
The 1985 Vienna Convention for Protection of the Stratosphere was developed as a framework convention establishing general objectives and a basis for cooperation on ozone layer protection. In order to achieve the elimination of the production of ozone depleting substances, the 1987 Montreal Protocol on Substances that Deplete the Stratospheric Ozone Layer, established trade restriction measures. Certain substances are listed as ozone depleting and all trade in those substances is generally banned between parties and non-parties. Bans may also be implemented against parties as part of the Protocol’s non-compliance procedure.
Whereas the 1992 United Nations Framework Convention on Climate Change (UNFCCC) does not provide for specific trade measures, the 1997 Kyoto Protocol contains more detailed obligation related to the reduction of greenhouse gases and provides for trade affecting techniques such as tax impositions on carbon dioxide emissions, the adoption of certain treatment or emission rules for greenhouse gas emissions not covered by the Montreal Protocol or the elimination of subsidies adversely affecting the objective of the UNFCCC.
Aiming to protect human health and the environment against the adverse effects which may result from the production and management the 1989 Basel Convention on the Control of Trans-Boundary Movement of Hazardous Wastes and their Disposal contains trade measures establishing a notification and consent procedure for any envisaged trans-boundary movement of hazardous and other wastes. The Convention acknowledges the sovereign right of states to ban the entry of hazardous wastes in their territories and contains obligations concerning transport, disposal, packaging and labelling. Parties may only export a hazardous waste to another party that has not banned its import and that gives written consent to the import. In general, parties may not import from or export to a non-party. Parties are also obliged to prevent the import or export of hazardous wastes if there is an indication that the wastes will not be treated in an environmentally-sound manner at their destination.
The above examples of trade measures in MEAs show that measures generally designed to protect the environment may have a direct impact on the freedom of international trade. Although the provisions in the fields of trade and environment should mutually complement each other according to Agenda 21 and many other international rules, it may occur that MEAs and trade agreements address the same issues differently whereby conflicts between the two fields of international law may arise. In such instances, disputes may be resolved according to the procedures as described in the respective MEA. However, disputes on trade measures in MEAs could also be taken to the WTO’s DSB, especially, if the Party affected by the trade measure is not a party to the MEA, but a member of the WTO. So far, MEAs have not been challenged directly under the WTO’s DSU. However, conflicts may arise between WTO rules and trade related measures where trade restrictions provided for in MEAs are used by a party to the MEA against a non-party to the MEA if both parties are members of the WTO. In such cases, the MFN and national-treatment principles, as well as provisions on eliminating quantitative restrictions are potentially infringed.145 Neither the WTO’s legal framework nor the wordings of MEAs claim to be hierarchically superior to the other. On the contrary, the concept of mutual supportiveness of trade and environment agreements is emphasised by both regimes without offering express solutions to solve possible conflicts resulting from the coexistence of trade and environment agreements. Generally, it can be stated that in case of a conflict between MEAs and WTO rules, the rules of treaty interpretation under the Vienna Convention on the Law of the Treaties and general rules of interpretation would have to be applied in order to determine which rules would take precedence over others.146 So far, trade measures within MEAs have not been in the centre of attention of international trade proceedings. However, WTO members may choose to take a case relating to trade measures in MEAs to the DSB of the WTO. Included in the Doha development agenda, and thus subject to ongoing negotiations, is the task of clarifying the relationship between trade measures in MEAs and WTO rules, the responsibility for which has been given to the WTO’s Committee on Trade and Environment.
6 The Trade and Investment Environment in Namibia
Since Independence in 1990, Namibia has been a member of the WTO. As a member of the African Union (AU) African Economic Community, the Southern African Development Community (SADC), and the Southern African Customs Union (SACU), Namibia is committed to a liberal trade regime.
Namibia’s economy is closely linked to the economy of South Africa. The Namibia dollar is pegged to the South African rand and some common trade and investment policies make economic trends including inflation closely follow those in South Africa.
Several human development indicators show that Namibia has made considerable progress since Independence in 1990. Within the United Nation’s Development Index, for example, Namibia ranks 127 out of 187 states.147 Furthermore, Namibia has made considerable progress towards the achievement of some of the Millennium Development Goals (MDGs).
Despite the considerable progress made so far, poverty (28.7% of the population live on less than US$1 a day); the HIV/AIDS pandemic, tuberculosis and malaria; household food insecurity; and unemployment are among the main problems facing Namibia.148
6.1 Trade Policy Review Namibia 2015
Monitoring national trade policies is one of the WTO’s fundamentally important activities. The main surveillance mechanism is the Trade Policy Review Mechanism (TPRM). WTO members are reviewed, the frequency of each country’s review varying according to its share of world trade. Namibia was part of the Trade Policy Review of the Southern African Customs Union (SACU, including Namibia, Botswana, Swaziland, South Africa and Lesotho). The fourth review of the trade policies and practices of SACU took place on 4 and 6 November 2015. The basis for the review is a report by the WTO Secretariat and a report by the Governments of Namibia, Botswana, Swaziland, South Africa and Lesotho.
EXCERPTS FROM THE 2015 WTO TRADE POLICY REVIEW: SOUTHERN AFRICAN CUSTOMS
ANNEX 3 – NAMIBIA149
6.1.1 Trade Performance Overview
Namibia’s economy is highly dependent on international trade with an average trade to GDP ratio of 95.6% in the period 2011-13. In 2013, Namibia ranked 88th among world merchandise exporters (excluding intra-EU trade), and 85th among importers. In services trade, Namibia ranked 109th among exporters and 120th among importers.150
Namibia’s external current account recorded uninterrupted surpluses from independence till 2009, when the previous year's surplus of 3.2% of GDP turned negative. During 2009-13, Namibia’s current account deficit averaged 3.5% and was expected to reach 6.6% in 2014. Namibia has been running a growing merchandise trade deficit, from US$658 million in 2008 to US$2,394 million in 2014.
Mining, especially diamonds, dominates exports. Exports of diamonds alone accounted for 21.1% of total exports in 2013, up from 16.5% in 2008. Other exports include metal ores and metals, and fish, beverages and animal products. Namibia’s exports were traditionally highly concentrated towards South Africa and Europe, but this changed in 2013 following the relocation of De Beers’ London-based rough diamond sales to Gaborone. Exports to Botswana are up from 0.5% of total exports in 2008 to 13.7% in 2013, while those to the United Kingdom fell from 15% to 2.1% over the same period. Exports to EFTA countries, particularly Switzerland, have more than doubled from 4.2% of total exports in 2008 to 9.8% in 2013.151 With the exception of South Africa and Angola, exports to other African countries in the region have increased, albeit from a modest base.
The bulk of Namibia's non-mineral exports benefit from preferential access for beef, fish and grapes to the EU (about 10% of total export earnings).
Namibia’s main imports are food, fuel, automotive products and transport equipment. Chemicals, mining ores and non-electrical machinery are also important. Imports are mainly from South Africa: 61.8% of total imports in 2013, down from 67.8% in 2008. Imports from EU (28) almost halved from 2008 to 2013, while those from EFTA countries grew more than six-fold, from 0.9% to 6.2%. Imports from Botswana, Zambia and Tanzania increased over the period, though from a low base.
Balance-of-payments data indicate that, from 2008-13, Namibia was both a net importer and exporter of services (in contrast to the last review period when Namibia was usually a net exporter). In 2013, Namibia recorded a small deficit of US$54 million, down from a surplus of US$352 in 2012, reflecting an increasing deficit in transportation services and a declining surplus in other private services.
Investment, as measured by gross fixed capital formation, grew on average by 12% per year during 2008-13. Mining absorbs the bulk of private investment. Total investment flows into Namibia as a proportion of GDP averaged 6-7% per year over 2008-13, which places Namibia ahead of its SACU partners in terms of attracting FDI. According to the authorities, about 80% of the stock of FDI in Namibia comes from South Africa.152
6.1.2 Trade-related Legislation (also relevant to the Environment)153
Agronomic Industry Act, 1992; Meat Industry Amendment Act, 1992; Karakul Pelts and Wool Act, 1982; Agricultural (Commercial) Land Reform Amendment Act, 2003; Stock Brands Act, 1995; Meat Corporation Act, 2001; Agricultural (Commercial) Land Reform Amendment Act, 2013 and 2014; Tobacco Products Control Act, 2010
Plant Quarantine Act, 2008 (commenced 2012); Animal Health Act, 2011; Animal Identification Regulations, 2009; Controlled Wildlife Products and Trade Act, 2008
Flexible Land Tenure Act, 2012; Water resources Management Act, 2013; Communal Land Reform Amendment Act, 2013
Trade Practices Act, 1976; Merchandise Act, 1941; Competition Act (No 2), 2003; Companies Act (No 61), 1973; Companies Act, 2004 (entered into force 2010); Companies Administrative Regulations, 2010; Competition Act, 2003 (in force since 2008); Amendment of Tender Board Regulations, 2013
Export Processing Zones Act, 1995
Exports and imports
Customs and Excise Act, 1998; Value-Added Tax Amendment Act, 2002; Imports and Exports Control Act, 1994
Marine resources Act, 2000; Regulations Relating to the Exploitation of Marine resources, 2001
Foreign Investment Act, 1990 and 1993 amendments
Tender Board of Namibia Act, 1996; State-owned Enterprises Governance Amendment Act, 2008
Intellectual Property Rights
Copyright and Neighbouring Rights Protection Act, 1994; Patents and Design Act, 1952; Patents Act, 1978; Proclamation No. 17, 1923; Trade Marks in South West Africa Act, 1973; Industrial Property Act, 2012
Minerals (Prospecting and Mining) Amendment Act, 2008; Diamond Act, 1999; Petroleum Products and Energy Act, 1990; Petroleum Exploration and Production Act, 1991 Petroleum Products and Energy Act, 1999
Electricity Act (No. 2), 2000; Electricity Regulations: Administrative Electricity Act, 2000; Air Services Act, 1949 and 1998 amendments; Aviation Act, 1962 and 1998 amendments; Telecommunications Policy and Regulatory Framework for Namibia, 1999; Namibian Communications Commission Act (No. 4), 1992, as amended; Post and telecommunications Act (No. 19) 1992, as amended; Namibia Broadcasting Act, 1991; Road Traffic and Transport Act,1999; Road Traffic and Transport Regulations, 2001; Road Fund Administration Act, 1999; Namibia Ports Authority Act, 1994, as amended; Airports Company Act, 1998; National Transport Services Holding Company Act, 1998; Supervisory Authority Act (No. 3), 2001; Building Societies Act, 1986 (No. 2), 1986; Accommodation Establishments and Tourism Ordinance Act (No. 20), 1973; Casinos and Gambling Houses Act, 1994; Liquor Act (No.6), 1998 (as far as it apply to accommodation establishments); National Housing Enterprise Act (No. 5), 1993; Pension Funds Act (No. 24), 1956; Electricity Act (No. 2), 2000; Namibia Institute of Public Administration and Management Act, 2010; Statistics Act, 2011; National Planning Commission Act, 2013
Currency and Exchanges Act, 1933; Prevention of Counterfeiting and Currency Act, 1965; Bank of Namibia Act, 1997; Agriculture Bank of Namibia Act (No.13), 1994; Banking Institutions Act, 1998; Payment Systems Management Act, 2003; Financial Intelligence Act, 2007; Long-Term Insurance Act (No. 5), 1998; Public Accountants and Auditors Act (No. 51), 1951; Stock Exchanges Control Amendment Act (No. 26), 1992; Banking Institutions Amendment Act, 2010; Financial Intelligence Act, 2012; Financial Intelligence Regulations, 2012; Unit Trusts Control Amendment Act, 2011; Pension Funds Amendment Act, 2011 and 2014; Credit bureau Regulations, 2014; Long Term Insurance Amendment Act, 2011; Amendment of Long-Term Insurance Regulations, 2013; Amendment of Pension Funds Regulations, 2013; Inspection of Financial Institutions Amendment Act, 2011
Standards Act (No. 18), 2005
6.1.3 Environmentally Relevant Import Practices
The Directorate of Customs and Excise within the Department of Revenue Management of the Ministry of Finance, is responsible for, inter alia, facilitating the smooth movement and clearance of legitimate trade, the collection of revenues and preparation of accurate trade statistics, and the detection and interdiction of illicit activities, including cross-border movement of undeclared or under-declared goods and contraband such as controlled substances and drugs.
Namibia operates a system of import permits for a range of products that are managed by a number of different agencies.154 The Namibian Agronomic Board is responsible for the import permit system under the Agronomic Industry Act, No. 20 of 1992, for the importation of controlled agronomic crops - white maize, wheat, pearl millet, and horticultural products. Permits for white maize and pearl millet are only granted during the open border period once domestic production has been marketed to millers. The Namibian Agronomic Board notifies openings and closings of the border for these cereals. Floor prices for controlled cereals are set by agreement between producers and processors based on a five-year average of the South African Futures Exchange (SAFEX) adjusted to import parity prices from South Africa. A licence fee of N$36 is payable; permits are valid from one to three months (which may be extended).
Sanitary and phytosanitary provisions apply to animal, plant and dairy imports, such as livestock, meat, fish, and honey. The Animal Health Act, 2011 (Act No. 1 of 2011) replaced the Animal Diseases and Parasites Act (Act No. 13 of 1956). Regulations supporting the new Act are currently under preparation. The Act requires the issuance of a permit prior to the importation of animals, animal products and restricted material, and a health certificate prior to export. The Act also makes provision for animal movement control and traceability and enforcement. Compensation is payable by the Government if an animal, animal product, or restricted material is destroyed for the purpose of controlling a disease. All imports of livestock, semen and embryos require a veterinary import permit and livestock improvement permit issued by the MAWF.
Importers of live animals (such as cattle, sheep, goats and pigs) must be in possession of a veterinary import permit from the MAWF. The OIE Animal Health Code is used as the guideline for setting import requirements.155 Some imports are subject to the approval of other institutions, e.g. the Ministry of Environment and Tourism in the case of protected species. In the case of breeding material, a livestock improvement permit is also required. An import permit, issued in Windhoek (N$50 per permit), is required prior to the importation or conveyance in transit of any animal, animal product or restricted material.
Animals may only be imported from countries free from bovine spongiform encephalopathy (BSE) and foot-and-mouth disease (FMD) where vaccination is not practised. In practice, live animals are usually only imported from South Africa or occasionally Botswana. Veterinary staff based at the border are available 24 hours a day to verify compliance with import and export requirements. All shipments of animals or animal products are verified, even if an MRA is in place.156 Heavy fines (N$1 million or imprisonment for a term not exceeding 20 years) are levied in the event of contravention or failure to comply, if found guilty in a court of law. In the event of an immediate risk of a disease being introduced or further spread in Namibia from another country, emergency restrictions may be put in place to prohibit imports. A health certificate is required for the exportation of animals, animal products and restricted material. A quarantine regime is operable in Namibia only for pets.
The Plant Quarantine Act 2008 (Act No. 7 of 2008), which repealed the Agricultural Pest Act (No. 3 of 1973), and accompanying Regulations came into operation on 1 July 2012. The Act provides for the prevention, monitoring, control and eradication of plant pests; the movement of plants, plant products and other regulated articles; and the certification of SPS standards for exported plants and plant products.
All imports of plants, plant products and other regulated articles require a permit issued by the MAWF (N$150, valid for 21 days) and a phytosanitary certificate issued by the plant protection authority of the country of export. The Act makes provision for fines not exceeding N$20,000 or imprisonment for a period not exceeding 2 years, or both, in the case of contravention of import procedures. The Act also grants the Minister of the MAWF the authority to declare by notice in the Gazette quarantine stations, areas and pests. Compensation is payable by the Government in the event that a plant or plant product is destroyed or harmed as a result of measures taken under the Act to eradicate, contain, or limit the spread of a plant pest. Plants may not be imported from countries with fruit flies.
A phytosanitary certificate is required from the MAWF for the export of any regulated plant material (N$150).
The Ministry of Environment and Tourism operates an import permit system for the import of wild animals or plants or their parts, derivatives and products. The system is intended as an instrument to control and protect Namibia's fauna and flora as well as for statistical purposes. A certificate from the country of export's CITES Management Authority supporting and verifying the export of the product and a CITES export permit from the country of origin are required for such products. A fee of N$100 is payable and a permit is valid for six months.
For the import of general medicines a licence is required from the Namibian Medicine Regulatory Council. Licences are only granted to registered wholesalers and distributors. Once a licence is issued, the import of general medicines can be undertaken without an import permit. However, special import permits are required for the import of narcotics and psychotropic substances. A fee of N$1,000 is payable.
As of December 2014, all grain and primary processed grain products are only allowed to enter Namibia if accompanied by a phytosanitary certificate from the country of origin, a certificate of analysis on key parameters including moisture, foreign matter and aflatoxins, an official grade attestation by the country of origin (where applicable) and a valid plant health import permit and trade import permit.
The Food Safety Bill of 2007 is being considered for further development to become a law. Regulations to support the bill are being drafted to cover abattoir hygiene and meat inspection.
In 2014, the Government developed the Namibia Food Safety Policy to protect consumer health while facilitating trade in food. In order to achieve this objective, the policy ensures that control standards are established and adhered to as regards food production safety, food product hygiene, animal health and welfare, plant health, and preventing the risk of contamination from external substances. It also lays down conditions for regulations on appropriate labelling for these foodstuffs and food products. Consequently, a Government notice was issued to all importers of grain, fresh produce and their primary processed products, fertilizers, farm feeds and pest control products,157 regarding increased inspection controls at designated border posts with effect from 15 December 2014. The authorities indicate that these measures are necessary to ensure food safety and adherence to import permit conditions. Inspections at border posts are carried out by the Agro-Marketing and Trade Agency including collection of levies applicable at the point of termination of the imports.158
6.1.4 Environmentally Relevant Export Practices
Exporters of live animals (cattle, sheep, goats and pigs) and products thereof must obtain a permit from the Meat Board of Namibia. There is no charge for the permit. Exporters of controlled agronomic products (white maize, wheat, pearl millet, and horticultural products) are required to register with the Namibian Agronomic Board. A registration fee is charged depending on milling capacity.
Exports, except to SACU members, of nearly all products are subject to automatic licensing. A non-automatic permit is required for,inter alia , medicines; live animals and genetic materials; all ostrich-breeding materials; meat and game products; protected species under CITES; plants and plant products; firearms and explosives; minerals, including diamonds and gold; coins and bank notes; certain works of art and archaeological findings; and oysters.
Exports of sheep are subject to a 6:1 rule, i.e. six sheep must be slaughtered locally for each sheep exported live. In response to drought conditions in 2013, a number of measures were approved to ease export conditions for small stock. These included amending the local slaughter/export ratio restriction from 6:1 to 1:1, for a 90-day period from 15 August 2013 to 15 November 2013. Cabinet approved the amendment in 2014. Government will continue to maintain the 1:1 export ratio until the industry can develop a long-term small stock marketing strategy, to ensure value addition in the whole chain.
Under a five-year agreement between De Beers and the Government of Namibia (signed in 2007), the Namibia Diamond Trading Company (NDTC) was created to sell 16% of cuttable diamonds locally in an attempt to establish a local cutting industry. 10% of cuttable diamond production must be made available to local cutting and polishing companies. The Government is engaged in negotiations to increase this percentage.
Namibia applies the Kimberley Process Certification Scheme through the Namibia Diamond Trading Company of the Ministry of Mines and Energy, to certify that Namibia's rough diamonds are from areas free of conflict. Trade measures necessary to implement the Kimberley Process are covered by a WTO waiver.159
In November 2010, Namibia imposed a general levy of 0.8% on the export price of cattle, sheep, goats or pigs. As of 1 April 2004, an export levy is charged under the Customs and Excise Act, 1998 on the export of slaughter-ready mature bovine animals (30%ad valorem ), hides (30%) and goat skins (15%). The 15% levy on pickled sheep skins was withdrawn as of 15 December 2013. The 30% export levy on cattle was temporarily withdrawn as from 15 August 2013 as a result of the drought, but was reintroduced as of 15 November 2014.
Unprocessed diamonds are subject to a 10% export tax. Raw hides and skins (wet- and dry-salted), and goat skins are subject to an export levy of 60% and 15% respectively.
Namibia has announced the introduction of an export levy on primary commodities and natural resources (i.e. diamonds and minerals, and fishery and forestry products) in order to promote domestic value addition and increase revenue. The proposed levy rate is not expected to exceed 2% of the value of the goods exported. Legislation in this regard is expected to be tabled in Parliament during 2015.
Agriculture is Namibia’s second largest primary industry after mining (Section 1). Approximately 48% of Namibia's rural households depend on subsistence agriculture. Over the period reviewed, the performance of the agricultural sector was weaker than projected due to drought, weak links with available markets and high levels of competition with imported products. In the period 2007-12, total agricultural production declined by 2.3% on average annually.160 Agricultural production per capita declined by 3.7% on average annually between 2007 and 2012, compared to an increase of 2.4% over the preceding six years.161 Namibia continues to import more than 50% of the cereals and horticultural products consumed locally.
The Namibia Statistics Agency and the Ministry of Agriculture, Water and Forestry are conducting an agricultural census of both communal and commercial areas, the first since 1994/95.162
Cattle, goats, sheep and pigs contribute over 75% of overall agricultural output value. Cereals such as flour maize and millet experienced a decline in production since 2008, particularly in 2013 due to drought conditions.
The agricultural sector is one of four strategic sectors identified by the Government of Namibia in its fourth National Development Plan (NDP4) 2012/13-2015/16 due to its growth and employment generation potential. The stated desired outcome of NDP4 is average real growth in agriculture of 4% per annum over the plan's period. Food self-sufficiency and national food security remain key priorities. Strategies to be deployed to achieve the NDP4 outcome are: the continued promotion of the Green Scheme; initiatives to increase the land's carrying capacity for livestock; the establishment of agricultural fresh produce markets; and the establishment of other agricultural infrastructure such as silos (National Strategic Food Reserve Facilities) and research stations.163 According to the NDP4, Government interventions in the sector will continue to be substantial and will include allocations to agriculture in the budget, tax concessions, and increasing exports of Namibian agricultural products, for example through assisting livestock farmers in communal areas in accessing markets.
The focus on agriculture under the NDP4 goes beyond production to include large-scale development of the agribusiness and agro-industrial sectors. The intention is to continue to improve financial and technical support to agricultural activities, including the provision of farming tools and implements; technical expertise and advice; seed and fertilizer; and agriculture-related infrastructure.
The Ministry of Agriculture, Water and Forestry (MAWF) is responsible for implementation of the NDP4 objectives in the agricultural sector. The last white paper on agricultural policy dating from 1995 is being amended. Although the focus is on food security, the policy is multi-dimensional and covers food processing, value addition, increasing food production and maximizing opportunities.
In October 2011, the MAWF formulated an Agricultural Marketing and Trade Policy and Strategy with the aim of contributing to the achievement of the agricultural sector's objectives as reflected in Vision 2030 and NDP4. The main marketing objectives of the strategy include stimulating downstream agro-industries, improving competitiveness of the agricultural industries, increasing local products' share of the domestic market and increasing the contribution of agriculture to the national economy.
The Namibian Agronomic Board (NAB) is the official marketing board for controlled agricultural products (white maize, wheat and pearl millet or mahangu and their milled products, and fresh horticultural products). The board is funded by levies payable on the production and processing (milling) of controlled crops. Pearl millet (mahangu), wheat and white maize producers and millers pay a levy of 1.4% plus VAT on the selling price.
In February 2015, the MAWF announced increases in the general levies applicable to imports of pearl millet, wheat and white maize seeds (5% plus VAT on the landed cost, up from the 2012 rate of 0.95%). The general levies applicable to horticultural products were increased as of December 2014. Producers, purchasers and sellers of horticultural products pay a levy of 1.4% on the selling price (up from the 2002 rate of 1.2%), while importers pay a levy of 5% (up from 1.2%). Levies on all such products are to be collected by the Agro-Marketing and Trade Agency appointed by the Namibian Agronomic Board.
In order to expand and promote the commercialization of mahangu, a Mahangu Marketing Plan (MMP) was developed by NAB and the MAWF and implemented as of 2010. The aim of the MMP is to increase surplus mahangu marketing by establishing marketing points closer to mahangu producers and to train farmers in business and production economics. A total of 1,422 farmers have been trained in business and production economics since the MMP's inception. The mahangu producer floor price has been de-linked from that of white maize and is now based on the mahangu production input cost. In 2013, the mahangu producer floor price was N$3.50 per kg.
In 2011, the MAWF piloted a debushing programme aimed at restoring the environment, improving the condition of rangeland, and increasing the productivity of land for both crops and livestock. The programme has the potential to create jobs either directly, through combating bush encroachment, or indirectly, by increasing productive farmland. In the long run, the debushing programme has the potential to increase economic growth and rural economic development, using labour-intensive methods.
The Water resources Management Act, 2013 which repeals the Water Act (No. 54 of 1956) provides for the management, protection, development, use and conservation of water resources. It also provides for the regulation and monitoring of water services. The Act establishes a Water Advisory Council to provide advice on water policy development and review; water resources management; and water abstraction and use. The Act establishes a water regulator responsible for setting tariffs for fees and charges that may be levied by water services providers, setting operational targets, and monitoring the performance of water services providers. Tariffs are to be determined by the water regulator on a full cost recovery basis. Under the terms of the Act, an Integrated Water resources Management Plan is to be prepared. Part 16 of the Act makes provision for water service plans, conservation, demand management and the implementation of efficient water management practices. Regulations to implement the Act are currently under preparation.
Namibia's notifications to the WTO in 2010 indicate that no export subsidies in agriculture were maintained during the years 2002-09.164 The authorities indicate that no export subsidies on agriculture were granted in the period 2010-14. Namibia reserved its right to use the special safeguard provision of Article 5 of the Agreement on Agriculture, but has indicated that such safeguards were not invoked during the period 2000-09.165 The authorities indicate that the special safeguard was not used during the period under review. Namibia has notified details of its domestic support commitments in agriculture for the financial years 2000/01 to 2009/10.166
Agricultural research is undertaken by the Directorate of Agricultural Research and Training within the Ministry of Agriculture, Water and Forestry. Efforts are focused on plant production research such as crop improvement, crop diversification and plant-soil nutrient management; vegetation surveys; support to indigenous plants products; and livestock research and development. Agricultural training, especially of emerging commercial, small-scale irrigation, resettled and communal farmers is an important part of the mandate of the Division of Agricultural Training. Other research bodies include the Desert Research Foundation of Namibia, the National Commission on Research Science and Technology, Gobabeb Research Centre, the University of Namibia and the Polytechnic of Namibia. In addition, Cabinet has approved the creation of a National Agricultural Research Institution (NARI), with the flexibility to offer competitive salaries and generate funding through its own activities.
Namibia does not currently have any seed laws or seed certification schemes to regulate or direct activities and quality standards in the seed sector. The Namibia Seed Policy was finalized in 2013. The policy addresses the challenges in the seed industry in respect of research, imports, production and quality control, marketing, distribution and the building up of strategic seed reserves, as well as developing an institutional legal framework.
The tariff is the main policy instrument in the agriculture sector. The SACU common external tariff on products of agriculture, hunting and fishing (ISIC Rev.2 category) averages 3.5% in 2015, and is predominantlyad valorem , ranging from zero to 35%. The average CET on fishing is 1.7%,ad valorem , ranging from 0% to 30%. Average tariffs on forestry and logging are 2.7%,ad valorem , and range from 0% to 25%.
The Directorate of Veterinary Services (DVS) and the Plant Health Division (PHD) are the authorities responsible for sanitary and phytosanitary measures.
Namibia’s marine resources are found in one of the most productive fishing grounds in the world. This productivity results from the Benguella Current System, an eastern boundary current upwelling system, which supports rich populations of demersal and pelagic fish. Fisheries continue to provide an important contribution to Namibia's economy. Its contribution to real GDP has fallen over the period reviewed mainly due to poor catches and higher fuel and labour costs. However, despite the decline in landings, Namibia continues to export almost all its annual catch. Exports of fish and fish products accounted for N$7.1 billion in 2013, making revenue from fisheries the second most important earner of foreign exchange, after mining. The export value in fish and fish products has decreased since 2008 due to fluctuations in fuel, product prices and exchange rates. Over 14,000 people are employed in the fisheries sector.
Namibia’s main export markets for fish are as follows: EU and South Africa (hake, monk, and tuna); DR Congo, Mozambique, Zambia, and Zimbabwe (horse mackerel); Japan (rock lobster); China (crab); South Africa (pilchards); Spain, Japan and US (tuna, swordfish and shark); and Turkey, China and South Africa (seals).
The Ministry of Fisheries and Marine resources (MFMR) manages capture fisheries (marine and freshwater/inland) and aquaculture (mariculture and freshwater). To date, inland capture fisheries and freshwater aquaculture are largely undeveloped and have primarily served as contributors to food security and income generation in rural households. Marine capture fisheries are an important pillar of the Namibian economy and produce fish mainly for export. While horse mackerel fishery has the largest landings by far, it generates less revenue than hake fishery which is exported to the EU and commands better prices.
Namibia had a forest area of around 7.3 million ha in 2010 (down from 7.7 million ha in 2005), 8.9% of its total land area; it had about 8.3 million ha of other wooded land (8.5 million ha in 2005). Namibia's forests contain 210 million metric tons of carbon in living forest biomass (221 million metric tons in 2005). Namibia has some 1,066 known species of amphibians, birds, mammals and reptiles, of which 4.5% are endemic and 3.1% are threatened.167
The MAWF has developed a Forest Research Strategy for Namibia (2011–15) to address issues associated with sustainable forest management (SFM), chiefly the key drivers of deforestation and forest degradation, and core SFM issues such as natural and artificial regeneration (tree planting) of commercially exploited species. Linked to these is also the issue of value addition to forest products, which are currently performing below their potential.168
The strategy document has identified seven strategic forest research areas: a vegetation (forest and rangeland) monitoring programme; forest products (value added) research; ecological studies; growth and yield studies; silvicultural research; economic, policy and sociological research; and management of information.
The Government has, through the MAWF, introduced a new policy direction to promote bush utilization, tree planting, commercialization of various forest products, and orchard development. Despite the environmental limitations of a dry country such as Namibia, the policy direction gives scope for research to improve the management of trees, woodlots and forests and to add value to already known products and bring new products to market.
Namibia exploits its forestry for a variety of uses. Charcoal is produced from aqueous species (bush-encroachment), primarily for export to the EU. Fire blocks from crushed bush are used for electricity production; 6% of the energy of Namibia's cement production is sourced from these bushes. The roots of the mopane tree that grows in north-western Namibia are used in fishing and construction and exported to the Americas, Japan and the EU. In addition, woodlands harbour fruit and nut bearing tree species of growing commercial importance such as marula, bird plum, and monkey orange. A number of medicinal plants such as devil's claw are found in woodlands and in the adjoining open savannah and desert environments.
In December 2014, tariffs on the export of wood products from Namibia were drastically increased. The tariff for processed wood increased from N$120 to N$300 per 30 ton load (last reviewed four years prior), while that for unprocessed wood products increased from N$120 to N$900. The Directorate's strategy behind this increase is to discourage exports of raw unprocessed wood products and to encourage value addition and employment creation. Charcoal and braai wood, cut and packed before export, are no longer considered raw products and thus qualify for the lower export tariff.169
6.1.8 Mining and Energy
Mining and quarrying accounts for about 13% of GDP at current prices and provides about 14,000 jobs. Ores and minerals account for about 35% of Namibia's exports of goods and services and a third of fixed capital formation. Diamonds, fluorspar and uranium are the most significant mineral commodities to Namibia's economy. Namibia is among the world's top ten diamond producers. Diamonds accounted for a declining share (around 50%) of the total value of mineral exports during the period under review. In 2013, diamonds accounted for 21% of total merchandise exports. Production of uranium also experienced a decline, following the global economic crisis and the move away from nuclear energy in European countries following the tsunami in Japan, but picked up again in 2013. Namibia has the capacity to provide 10% of the world’s current uranium needs.
Namibia has 2.2 trillion cubic feet of natural gas reserves, making it the 60th largest global source but has no petroleum reserves.170 Namibia continues to rely on imports for much of its energy needs. More than two thirds of electricity and all of Namibia's petroleum are imported. Namibia has great potential in renewables given its supply of wind, solar and biomass resources.
Although petroleum has not been discovered in commercial quantities to date, the off-shore discovery of oil in non-commercially viable quantities in 2013 raised hopes of Namibia becoming a new frontier in oil exploration.
Under the Electricity Act of 2007, NamPower, the state-owned utility company is responsible for generation, transmission, and trade in electricity. NamPower's energy policy goal is to supply 100% of peak demand for electricity (and 75% of total demand) from local sources of power generation. Namibia currently imports over 60% of its electricity needs. NamPower owns five generating assets with a total capacity of 504 MW. These consist of one hydropower plant (Ruacana with a capacity of 338 MW), two liquid fuel plants (Paratus and newly built Anixas with a capacity of 24 MW and 22 MW, respectively) and one coal fired plant (Van Eck with a potential capacity of 120 MW).171 In addition to these, a small pilot plant (250 kW) utilising a widely available domestic biomass fuel, invader bush, is located about 200 km north of the capital. An independent power producer (IPP) solar photo voltaic plant of 4.5MW was scheduled to be commissioned in May 2015.
Peak demand for electricity reached 629 MW in 2014 and is growing annually by around 6%. The interconnector capacity currently stands at 900 MW, consisting of a 600 MW connection to the South African system and the 300 MW Caprivi Link in the northeast linking the Namibian system to the Zambian grid, with an option for a 300 MW increase in capacity when Phase 2 of the project is completed.
Demand for electricity continues to outstrip supply, a situation expected to prevail until the commissioning of the 884 MW Kudu combined cycle gas turbine station, expected in 2018.
Namibia has a relatively small manufacturing sector, largely based on its resource endowment of fisheries and meat. In constant 2010 prices, manufacturing has registered a steady increase over the period reviewed. Food products and beverages have benefited from improved shares in both local and external markets. Textiles and grain mill products have also experienced growth. Increased meat processing reflects the slaughtering of livestock both for export and local consumption due to the 2012 drought which forced farmers to reduce their herds.
Services account for a growing share of GDP, largely due to increases in the share of wholesale and retail trade, transport, financial intermediation, real estate and business services, education and health services. Trade in services has grown on average by over 6% annually since 2008.
The Department of Transport is responsible for transport by road, rail, air and sea and is divided into six directorates dealing with civil aviation, aircraft accident investigations, maritime affairs, railway affairs, transportation infrastructure management, and transportation policy and regulation. Government investment in infrastructure development as a percentage of GDP hovers around 5%.
Tourism makes a significant contribution to Namibia's GDP and employment. In 2013, travel and tourism directly contributed 3% to GDP and 24,000 jobs (4.5% of total employment). With regard to the long-term growth potential for the period 2014-24, the World Travel and Tourism Council ranks Namibia among the world's fastest growing tourist destinations, with expected annual growth rates of 9.1% in terms of travel and tourism's direct contribution to GDP.172
6.2 Foreign Investment173
Namibia’s Vision 2030, launched in 2004 and aiming to provide long-term policy scenarios on the future course of development in the country at different points in time until 2030. Vision 2030 formulates an target of 10.2% investment growth by 2030.174
Trade and investment form an integral part of Namibia's overall economic policy as outlined in NDP4. In NDP4, four economic sectors – logistics, tourism, manufacturing and agriculture enjoy priority status. The Government seeks to attract foreign investment and promote exports with the goal of having not less than 70% of total exports made up of processed goods. Trade plays a leading role in achieving NDP4's goals of economic growth, employment creation and reducing inequality. The Government aims to use procurement to stimulate more local business.175
The fourth National Development Plan (NDP4) for the period 2012/2013-2016/2017 acknowledges that investment “is a key driver of sustainable economic development, and experience from successful emerging economies highlights the importance of a high rate of investment to achieve long-term growth.”
NDP4 considers current investment levels to be insufficient to support higher economic growth176 and has identified “making Namibia the preferred investment location in Africa”177 as one of the foundation issues without which other efforts are not likely to succeed. A review of performance under the NDP3 (period from 2007/2008 to 2011/2012) has concluded that
Private investment, including foreign direct investment, was targeted at N$50.3 billion, although actual investment was N$43.7 billion. Private savings in Namibia were substantially higher than private investment over the NDP3 period. Therefore it appears that the reason for below target investment is not a lack of investable funds, but rather a lack of mechanism to channel such funds to domestic investments. This suggests that more needs to be done not only to encourage private sector investment, but also to ensure Government efforts facilitate this. Government investment, including State-owned enterprises (SOEs), was close to the N$20 billion target at N$19 billion. However, of concern was the rate of Government savings, which decreased from around 8% of GDP at the start of the NDP3 cycle to an estimated -2% by 2011/12. In order for public investment to remain sustainable, public savings need to increase over the NDP4 cycle.178
Taking that an average of 3.6% annual economic growth (GDP) was achieved over the NDP3 period, the outlook in terms of the NDP4 sets an ambitious target of an average of 6% annual growth over the NDP4 period. According to NDP4, the prioritisation of investments into power generation is one of the keys to reaching this target.179 To this end, NDP4 emphasises the urgent requirement for investment:
For the NDP4 goals to be realized fully, there is a need to make a substantial investment in the economy. Based on the currently available data, the investment requirement is estimated at N$187 billion. Given the size of the required investment, the Government’s investment strategy will be guided by the principle of a Government-led economic development, combined with the need to maintain the necessary macro-economic stability. The Government will therefore undertake the required investment in partnership with the private sector, where a mutually beneficial public-private-partnership investment program will be considered and implemented.180
A foreign investor may decide to invest in Namibia because of,inter alia, the liberal investment incentive regime, the sound financial system, the stable foreign exchange reserves, the friendly legal and regulatory framework, and its membership in international agreements. In addition, in 2013, the World Bank ranked Namibia 98th out of 189 countries in the world in terms of doing business, and 80th in terms of protecting foreign investors,181 while it was ranked eighth out of 47 countries in terms of doing business in sub-Saharan Africa, and 12th in investor protection. As a result, Namibia has attracted many foreign investors. As foreign investment is important in Namibia, Article 99 of the Constitution expressly provides for the encouragement of foreign investment, and for the establishment of an investment code. Pursuant to the Article mentioned above, the Foreign Investment Act was passed by Parliament in 1990. Additionally, there is other national legislation and applicable international law in place, both important to foreign investors.
The Foreign Investment Act No. 29 of 1990 is the primary legislation that governs foreign direct investment in Namibia. The Ministry of Trade and Industry (MTI) is the governmental authority which is primarily responsible for carrying out the provisions of the Foreign Investment Act.182
The Namibian Foreign Investment Act is currently under review.183 “The new Investment Act anticipated to come into force in November is expected to bring about fundamental changes to the country's trade and investment arena”.184
The Namibian Competition Act of 2003, which is currently also under review, is another piece of legislation affecting the activities of foreign investors.
A number of countries have entered into Reciprocal Promotion and Protection of Investment Agreements (RIPPAs) with Namibia. Such agreements are Bilateral Investment Treaties (BITs) with reciprocal benefits, and foreign investors from the countries concerned are able to be accorded protection under the BITs concerned.185
With regard to dispute settlement, Namibia’s BITs follow the approach taken under customary international law, because they provide for international arbitration as a mechanism for the settling of disputes. In addition, dispute settlement gives an option to a state, or to a foreign investor, to settle its dispute domestically through a competent court or tribunal. What is common to the BITs is the provision of the International Centre for the Settlement of Investment Disputes (ICSID) as an institution by means of which investment disputes can be settled.
In terms of Article 12 of the Namibia-Austria BIT, the investor may choose to submit a dispute to a court, or to an administrative tribunal, in the host state. The disputes are to be resolved by means of the use of amicable and time-efficient methods, such as negotiation and mediation as a possible first option. Only if such methods fail, can the parties concerned submit the matter to litigation or arbitration. Secondly, an investor may choose to submit the dispute in accordance with any agreed dispute procedure. Thirdly, the dispute may be submitted to the ICSID, to a sole arbitrator, or an ad hoc arbitration tribunal that is established in terms of the Arbitration Rules of the United Nations Commission on International Trade Law (UNCITRAL); or to a sole arbitrator, or to an ad hoc tribunal that is established under the Arbitration Rules of the International Chambers of Commerce (ICC).186
The BIT between Namibia and Spain also gives options to the parties to the dispute. In terms of Article 11 of the agreement, the parties can either submit the dispute to a local court, or make use of the UNCITRAL Arbitration Rules, or the ICSID Convention. The Namibia-Netherlands BIT provides for the ICSID to be used for the settlement of disputes if both parties are members thereof. Alternatively, parties should make use of the ICSID Additional Facilities if one of the parties to the dispute is not a member of the said Convention. The BIT between Germany and Namibia also provides for disputes to be resolved by the ICSID.
7 Concluding Remarks
Natural resources represent a significant and growing share of world trade, and properly managed, provide a variety of products that (continue to) contribute greatly to the quality of human life. They, however, also represent challenges for policy makers. Natural resources are scarce, economically useful, distributed unevenly and exhaustible. Their production, trade and consumption can have negative externalities187 on people and the environment. Natural resources are dominated by national economies, they are highly volatile.188
The ‘curse’ of natural resources, climate change, water stress, food security and the prevalence of povertyinter alia remain challenges for Africa. All of these are also linked to international trade and certainly go hand in hand with poverty reduction, self-reliant sustainable development and the rational use of Africa’s natural resources.
With regards to trade, over-exploitation of natural resources, widespread dumping of sub-standard products and services, second-hand and re-conditioned machinery, including of transport goods to increase the share in exports in organically-grown agricultural products to create technical data bases on a wide range of exportable products, implementing and monitoring plans for detection of heavy metals, pesticides, microbiological and contaminants in food items are issues that need to be addressed. Another remaining challenge in terms of the WTO and the environment (e.g. biodiversity) is to control the transfer of genetically modified goods, including when delivered as food aid.189
The balancing act of bringing the interests of trade, environmental protection and sustainable development in line with each other can only succeed with a joint effort from all relevant stakeholders. On the occasion of the twentieth anniversary of the WTO, Director-General Roberto Azevêdo said:
twenty years ago the founders of the WTO saw clearly that the well-being of habitats, societies, and economies are not separate. Rather, they are inextricably linked. Their vision was of global cooperation in trade as a means to unleash growth, alleviate poverty, raise living standards and ensure full employment, while also protecting the environment…In the 20 years since then, the connections between trade and the environment have grown significantly. We must therefore do more to ensure that trade and environmental policies work better together, both at national and international levels. Today we have taken an important step forward to improve multilateral cooperation and dialogue on these issues.
And UNEP’s Executive Director Achim Steiner reflected as follows:
Trade brings the world closer together — bringing with it many opportunities but also challenges. It will not drive sustainable development by itself, but only if the international community clearly commits itself to trade-related policies and other support measures that are conducive to environmental, social and economic sustainability…International trade governance is evolving quickly. We need to assure that new structures do not come at the cost of the environment, but are drivers of an inclusive Green Economy. UNEP looks forward to continuing collaboration with the WTO as it prepares for its Ministerial Conference in Nairobi and for the decades to come.190
Scarce natural resources, climate change, water stress, food security and the prevalence of poverty, inter alia, remain major challenges. All of these are also linked to international trade and certainly go hand-in-hand with poverty reduction, self-reliant sustainable development and the rational use of natural resources. Although various legal provisions in the framework of the WTO provide a solid foundation for modern-day trade to fully embrace the concept of sustainable development and preservation of the environment, there is ample scope for state and organisational practice to exploit its full potential in this regard.
In the implementation of pro-poor policies and sustainable development, natural resources management, integrated reporting, environmental planning, environmental impact assessment and the overall policy review remain part of the on-going African working agenda. Moreover, new technologies, environmentally friendly goods and services need to be promoted and the protection and preservation of traditional knowledge, agriculture and species is important, especially in the African context. All of that requires national commitment, international cooperation, adequate technical assistance and capacity building. Let us see what (and when) the ongoing Doha negotiations will bring for Africa. With regard to the forthcoming WTO Ministerial Conference in Nairobi in December 2015, WTO Director-General Roberto Azevêdo
outlined the significance of the WTO’s forthcoming ministerial conference in Nairobi in December 2015. He described the state of play in negotiations, the difficulties in advancing the core Doha Development Agenda (DDA) issues, and some of the potential negotiated outcomes which might be achieved in Nairobi. These outcomes (should) include steps on export competition in agriculture. DG Azevêdo said this would be the WTO's most significant negotiated outcome on agriculture to date, which has long been the top priority for developing countries. In addition, he underlined the importance of development and least developed countries (LDC) issues, which should be at the heart of any agreement in Nairobi.191
The 2015 Nairobi meeting is the WTO’s first ministerial conference to be held in Africa since the organisation was created in Marrakesh two decades ago. This perhaps underlines the importance of delivering improved outcomes for development.
1 Ruppel (2009c; 2010g, l).
2 Goyal (2006:11).
3 For further reading see Goyal (2006) and UNEP (2005d).
4 For a detailed discussion see UNEP (2005d:3ff.).
5 The World Commission on Environment and Development.
6 Beyerlin (1996).
7 Cf. Sands (2003:254).
8 Beyerlin (1996) with further references.
9 Sands (2003:263).
10 Kameri-Mbote / Odote (2009:37).
11 Klaus Töpfer in the Preface to Zaelkeet al. (2005).
12 Commission on Legal Empowerment of the Poor (2008:1ff.).
13 Interview available at http://www.moneyweb.co.za/mw/view/mw/en/page295799?oid=526093&sn=2009+Detail&pid=295799; accessed 30 January 2011.
14 UN Open Working Group Proposal for Sustainable Development Goals https://sustainabledevelopment.un.org/content/documents/1579SDGs%20Proposal.pdf; accessed 17 February 2015.
15 See http://www.undp.org/content/undp/en/home/mdgoverview/post-2015-development-agenda.php; accessed 9 November 2015.
16 The following passages are largely based on Ruppel (2010f, g).
17 Cf. Ruppel (2009a; 2010b); Ruppel / Bangamwabo (2008).
18 Cf. Pillay (2009).
19 Ruppel (2009c).
21 Yahie (2000).
22 Cf. Asche / Engel (2008:11ff.).
23 Ruppel / De Klerk (2009).
24 Politicians often receive so-called ‘signature bonuses’ for approving resource or other investment deals.
25 Keenan (2009:125f.).
26 Khor / Hormeku (2006); Ruppel (2010k).
27 Zunkel (2010:v).
28 AusAID (2007).
30 Cf. Malhotra (2004).
31 Cf. Ruppel (2012d).
32 Lamy (2009).
34 Such stated by Lamy (2010a).
35 Lamy (2010b).
36 Cf. Dessande (2010); Ruppel (2010g).
37 Ruppel (2012d:156).
38 Ukpe (2010:231).
39 Ruppel / Ruppel-Schlichting (2012).
40 Ban Ki-moon speech (delivered by Jean Christophe Bouvier) at the Fourth Nevsky International Ecological Congress, Saint Petersburg, Russian Federation (May 2011) athttp://www.un.org/News/Press/docs/2011/sgsm13576.doc.htm; accessed 12 June 2011.
41 Resolution on Programme for the Further Implementation of Agenda 21 GA Res 19/2, UN Doc S-19/2 (1997) para. 27.
42 Susswein (2003:303).
43 Andresenet al . (2001:3).
44 Ruppel (2008a:116).
45 Sands (2003:263).
46 Kameri-Mbote / Odote (2009:37).
47 CEC (2008:3).
48 This and the following two paragraphs are largely based on Ruppel / Ruppel-Schlichting (2012).
49 WT/DS58 Appellate Body Report, adopted on 21 November 2001. Available athttp://www.wto.org/english/tratop_e/dispu_e/cases_e/ds58_e.htm; accessed 28 April 2015. This case will be sketched below in the subsection on relevant WTO disputes.
50 WTO (2015:9); VanGrasstek (2013:3); Van den Bossche / Zdouc (2013:84).
51 As at April 2015.
52 See Article III of the Agreement Establishing the WTO.
53 Seehttp://www.wto.org/english/thewto_e/whatis_e/what_we_do_e.htm; accessed 30 January 2014.
55 Text on the Agreement Establishing the World Trade Organisation athttp://www.wto.org/english/docs_e/legal_e/04-wto.pdf; accessed 10 November 2015.
56 The Doha Ministerial Declaration is available athttp://www.wto.org/english/thewto_e/minist_e/min01_e/mindecl_e.htm; accessed 10 November 2015.
57 E.g. the 1998 Rotterdam Convention on the Prior Informed Consent Procedure for Certain Hazardous Chemicals and Pesticides in International Trade; the 2001 Stockholm Convention on Persistent Organic Pollutants (POPs); the 1989 Basel Convention on the Control of Trans-boundary Movements of Hazardous Wastes and their Disposal; the 1985 Vienna Convention for the Protection of the Ozone Layer; the 1987 Montreal Protocol on Substances that Deplete the Ozone Layer; the 1992 Bonn United Nations Framework Convention on Climate Change and its 1997 Kyoto Protocol; and the 1992 Rio Convention on Biological Diversity, to name but a few of the most prominent MEAs.
58 Discussed below under 4.6.5.
59 Cf.http://www.wto.org/english/tratop_e/envir_e/envir_wto2004_e.pdf; accessed 10 November 2015.
60 Stoll / Schorkopf (2006:258f.).
61 Seehttp://www.wto.org/english/docs_e/legal_e/56-dtenv_e.htm; accessed 10 November 2015.
62 See 1994 Marrakesh Ministerial Decision on Trade and Environment athttp://www.wto.org/english/docs_e/legal_e/56-dtenv_e.htm; accessed 10 November 2015.
63 Seehttp://www.wto.org/english/tratop_e/envir_e/cte00_e.htm for further information; accessed 10 November 2015.
64 On the trade and environment negotiations seehttps://www.wto.org/english/tratop_e/envir_e/envir_negotiations_e.htm; accessed 10 November 2015.
65 Seehttp://www.wto.org/english/tratop_e/serv_e/gats_factfiction1_e.htm; accessed 10 November 2015.
66 Seehttp://www.wto.org/english/tratop_e/tbt_e/tbt_e.htm; accessed 10 November 2015.
67 Seehttp://www.wto.org/english/tratop_e/sps_e/sps_e.htm; accessed 10 November 2015.
68 Fromhttp://www.wto.org/english/thewto_e/whatis_e/tif_e/agrm7_e.htm; accessed 10 November 2015.
69 See also the Chapter 18 in this book.
70 Seehttp://www.wto.org/english/tratop_e/scm_e/scm_e.htm; accessed 10 November 2015.
71 Seehttps://www.wto.org/english/news_e/news14_e/envir_08jul14_e.htm; accessed 14 April 2015.
72 List available at http://www.apec.org/Meeting-Papers/Leaders-Declarations/2012/2012_aelm/2012_aelm_annexC.aspx; Declarations/2012/2012_aelm/2012_aelm_annexC.aspx; accessed 14 April 2015.
73 For more details see Delich (2002:71ff.).
74 Seehttps://www.wto.org/english/news_e/news15_e/ds500rfc_10nov15_e.htm; accessed 11 November 2015.
75 Seehttps://www.wto.org/english/tratop_e/dispu_e/dispu_maps_e.htm; accessed 11 November 2015.
76 African countries which have participated as third parties are Benin, Cameroon, Chad, the Ivory Coast, Egypt, Ghana, Kenya, Madagascar, Malawi, Mauritius, Namibia, Nigeria, Senegal, South Africa, Swaziland, Tanzania, Zambia and Zimbabwe. Seehttp://www.wto.org/english/tratop_e/dispu_e/dispu_by_country_e.htm#respondent; accessed 1 November 2015.
77 Horlick / Fennell (2013:164); Zunckel / Botha (2012:3); Alavi (2007:25-42).
78 UNCTAD (2014a:9).
79 See UNCTAD (2013a:11).
80 See WTO Database on International Trade and Market Access Data; Profile for Africa athttp://webservices.wto.org/resources/profiles/MT/TO/2012/AFR_e.pdf; accessed 30 January 2014.
81 See World Bank (2011:xiii); Rugwabiza (2012).
82 Seehttp://www.wto.org/english/tratop_e/envir_e/edis01_e.htm; accessed 10 November 2015.
83 United States – Prohibition of Imports of Tuna and Tuna Products from Canada, adopted on 22 February 1982.
84 Seehttp://www.wto.org/english/tratop_e/envir_e/edis02_e.htm; accessed 10 November 2015.
85 Canada – Measures Affecting Exports of Unprocessed Herring and Salmon, adopted on 22 March 1988.
86 Seehttp://www.wto.org/english/tratop_e/envir_e/edis04_e.htm; accessed 10 November 2015.
87 United States – Restrictions on Imports of Tuna, circulated on 3 September 1991, not adopted.
88 Seehttp://www.wto.org/english/tratop_e/envir_e/edis07_e.htm; accessed 10 November 2015.
89 United States – Standards for Reformulated and Conventional Gasoline, Appellate Body Report and Panel Report, adopted on 20 May 1996.
90 Seehttp://www.wto.org/english/tratop_e/dispu_e/cases_e/ds193_e.htm andhttp://www.wto.org/english/tratop_e/envir_e/envir_wto2004_e.pdf; accessed 10 November 2015.
91 United States – Import Prohibition of Certain Shrimp and Shrimp Products, Appellate Body Report and Panel Report, adopted on 6 November 1998.
92 United States – Import Prohibition of Certain Shrimp and Shrimp Products, Recourse to Article 21.5 by Malaysia, Appellate Body Report and Panel Report, adopted on 21 November 2001.
93 Seehttp://www.wto.org/english/tratop_e/dispu_e/cases_e/ds332_e.htm; accessed 10 November 2015.
94 MERCOSUR (Spanish: Mercado Común del Sur; Portuguese: Mercado Comum do Sul; English: Southern Common Market) is an economic and political agreement between Argentina, Brazil, Paraguay and Uruguay.
100 In its first written submission see WT/DS394/R/Add.1, WT/DS395/R/Add.1, WT/DS398/R/Add.1.
101 WT/DS394/R; WT/DS395/R; WT/DS398/R.
102 WT/DS394/AB/R, WT/DS395/AB/R, WT/DS398/AB/R.
103 At its meeting on 22 February 2012, see WT/DS394/16, WT/DS395/15, WT/DS398/14 (24 February 2012).
104 Panel Report athttp://www.wto.org/english/tratop_e/dispu_e/431_432_433r_e.pdf; accessed 18 February 2015. On this case, see also Baroncini (2012).
105 WT/DS431/1; G/L/982,http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds431_e.htm; accessed 30 January 2014.
106 WT/DS433/1; G/L/984,http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds433_e.htm; accessed 30 January 2014.
107 WT/DS432/1; G/L/983,http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds432_e.htm; accessed 30 January 2014.
108 WT/DS431/4; WT/DS432/4; WT/DS433/4.
109 A set of 17 chemical elements, usually referred to as rare earths. These include 15 lanthanides (lanthanum, cerium, praseodymium, neodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium and lutetium) as well as scandium and yttrium. The request specifically refers to certain materials falling under but not limited to a vast number of Chinese Customs Commodity Codes.
110 Humphries (2013).
111 Van den Bossche / Zdouc (2013:105).
112 Which is currently the case for 48 countries. See UNCTAD (2014b).
113 Van den Bossche / Zdouc (2013:148).
114 See footnote 1 to Article IX of the WTO Agreement.
115 For a comprehensive compilation of the special and differential treatment provisions, and their use, see WTO (2013).
116 Keck / Low (2004).
117 Cf. WTO website for the latest version of the Agreement (WT/L/931, previously issued under WT/PCTF/W/27).
118 This section is largely based on Ruppel (2013).
119 Adger / Pulhin (2014:760).
120 Ahmedet al. (2009).
121 Lecocq / Shalizi (2007:4315).
122 Hope / Kempe (2009).
123 See WTO / UNEP (2009).
124 Houser (2010).
125 Pogge (2010:534).
126 Ruppel / Ruppel-Schlichting (2012a:46). See Spier (2012).
127 Ruppel / Ruppel-Schlichting (2012a).
128 Moncel / van Asselt (2012).
129 Hestermeyer (2012:57).
130 See e.g. Doelle (2004); Hufbaueret al . (2009); Zelli / van Asselt (2010).
131 See Eckersley (2004).
132 Green (2006).
133 Paragraph 24 of the Pittsburgh Summit Declaration; athttp://www.g20.utoronto.ca/2009/2009communique0925.php; accessed 15 April 2015.
134 In November 2012, however, the European Commission proposed deferring the application of the scheme to flights into and out of Europe until after the ICAO General Assembly in autumn 2013 as a gesture of goodwill in support of an international solution.
135 Kulovesi (2012).
136 For an overview of legal arguments in this regard see Kulovesi (2011).
137 Scott / Rajamani (2012).
138 See http://www.imo.org/MediaCentre/resources/Pages/Greenhouse%20gas%20emissions.aspx; accessed 15 April 2015.
139 Seehttp://ec.europa.eu/clima/policies/transport/shipping/index_en.htm; accessed 15 April 2015.
140 Delbrück (2012:15).
141 Schreuer (2001:177).
142 Kulovesi (2012).
143 Tietje (2001).
144 Delbrück (2001).
145 For more details see UNEP (2005d:65ff.).
146 For a detailed discussion see Goyal (2006:356ff.).
147 UNDP (2014:159).
148 See GRN (2013:15, 20). The current unemployment rate is 28.1%, see NSA (2014:68).
149 The following passages highlighted in grey, including footnotes are based on the WTO document WT/TPR/S/324, available athttps://www.wto.org/english/tratop_e/tpr_e/tp424_e.htm; accessed 9 November 2015.
150 WTO statistics database. Viewed at:http://stat.wto.org/CountryProfile/WSDBCountryPFView.aspx?Language=E&Country=NA.
151 The EFTA-SACU FTA entered into force in 2008.
152 Namibia does not currently capture FDI data by industry, but the authorities indicate that a project to capture more segregated data is expected to be launched in 2016.
153 This compilation is based on the Trade Policy Review SACU 2008 WT/TPR/S/222 and the Trade Policy Review SACU 2015 WT/TPR/S/324.
154 WTO document G/LIC/N/3/NAM/5, 11 May 2010.
155 In the case of animals/animal products from South Africa, a veterinary import permit is only required for the importation of ostriches, elephants, wild pigs, wildebeest and buffalo. Importation of other animals/animal products is subject to a veterinary movement certificate issued by an official veterinarian in South Africa in accordance with the requirements as set out in the Namibian/South African bilateral agreement. Importation of dogs and cats for personal use from South Africa is allowed without a veterinary import permit, but a health certificate/movement permit issued by an official veterinarian in South Africa is required.
156 Namibia does not have Mutual Recognition Agreements with any other countries.
157 In accordance with the Agronomic Industry Act No. 20 of 1992 and the Fertilizers, Farm Feeds, Agricultural Remedies and Stock Remedies Act No. 36 of 1947.
158 Gazette Notice No. 247 of 1 August 2014.
159 WTO document WT/L/876, 14 December 2012.
162 The results of the 2012 livestock census can be viewed at: http://www.nammic.com.na/index.php?option=com_jdownloads&Itemid=146&view=viewdownload&catid=2&cid=158
163 Namibia's Fourth National Development Plan (2012), p. 18.
164 WTO document G/AG/N/NAM/16, 26 April 2010.
165 WTO document G/AG/N/NAM/17, 26 April 2010.
166 WTO documents G/AG/N/NAM18 and G/AG/N/NAM/19, 15 October 2010.
167 Mongabay online information, "Namibia".
168 Ministry of Agriculture, Water and Forestry, 2011.
169 New Era online information. Viewed at:http://www.newera.com.na/2015/02/10/wood-products-export-tariffs-increased/ .
170 US Energy Information Administration. Viewed at:http://www.eia.gov/countries/country-data.cfm?fips=wa .
171 Current capacity of the Van Eck plant is about 50 MW. The plant is currently undergoing refurbishment, scheduled for completion in 2014, after which a capacity of at least 90 MW is guaranteed.
172 World Travel and Tourism Council (2014).
173 Partially based on Ruppel / Shifotoka (2015).
174 GRN (2004a:63).
175 WTO (2015).
176 GRN (2012b:xvi).
181 International Finance Corporation (2013).
182 Cf. US Department of State (2013).
183 MTI (2014).
184 Cf.The Namibian of 17 June 2015. Athttp://www.namibian.com.na/index.php?id=138241&page=archive-read ; accessed 9 November 2015.
185 Existing BITs concluded by Namibia and the following countries: Angola, Austria, China, Cuba, Finland, France, Germany, Italy, Malaysia, Netherlands, Russian Federation, Spain, Switzerland and Vietnam, UNCTAD (2013b).
186 See Article 12 of Namibia-Austria BIT, Article 9 of the Namibia-Netherlands Agreement, Article 11 of Namibia-Spain BIT and Article 11(2) of the Namibia-Germany BIT.
187 An example of such negative externality would be when a production or mining process results in pollution affecting the health of people who live nearby, or that damages the natural environment, animal or plant life or reduces the livelihood of people.
188 WTO (2010).
190 Seehttps://www.wto.org/english/news_e/pres15_e/pr741_e.htm; accessed 7 May 2015.