Globalization and the Environment

Globalization and the Environment

Risk Assessment and the WTO

Edited by David Robertson and Aynsley Kellow

One of the unforeseen consequences of the WTO agreements has been controversy over risk. This volume explores aspects of risk with special reference to the WTO, where national instruments to reduce risk may conflict with international trade rules. The book is divided into sections dealing with: accounting for risk in trade agreements; risk and the WTO; managing risk in policy making; negotiating experience with risk; national risks and quarantine standards; and managing biotechnology.

Chapter 13: A business view of quarantine

Lyall Howard

Subjects: economics and finance, environmental economics, international economics, environment, environmental economics

Extract

Lyall Howard It is my task to review the two chapters on quarantine, by Wilson and Gascoine (Chapter 11), and MacLaren (Chapter 12). The first is a survey of the SPS agreement and its implications for Australia’s quarantine regulations, which reveals some continuing obscurities about avoiding SPS measures being used as non-tariff barriers to trade. MacLaren’s paper is an economic analysis of risk in specific circumstances. The Wilson–Gascoine chapter notes that food safety and animal and plant health measures that affect trade have been subject to GATT rules since 1948. The GATT article XX (b) exception permitted countries to introduce new measures to protect public health and welfare provided they did not unjustifiably discriminate between countries, nor were disguised restrictions on trade. However, the prevailing GATT rules were inadequate to sustain the more comprehensive WTO agreements. The GATT exception made it difficult to challenge national measures because of differing interpretations of what constitutes ‘necessary’ to an importing country (Rajasekar, 1999). This, together with the absence of an effective dispute settlement mechanism, explained why there were no SPS disputes during the 47 years of GATT. Within the first 18 months of the SPS agreement, however, seven formal complaints were lodged under the dispute settlement process (Stanton, 1997). There have been many more since. These disputes have been highly controversial (for example, EU–US beef-hormones, Canada–Australia salmon, and so on). An important forerunner of the Uruguay Round agreement on SPS was the Code on Technical Barriers to Trade negotiated in...

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