Developing Countries in the World Trading System

Developing Countries in the World Trading System

The Uruguay Round and Beyond

Edited by Ramesh Adhikari and Prema-chandra Athukorala

The book examines the achievements of the Uruguay Round of trade negotiations in reforming the world trading system and the challenges to future reforms. It begins with an overview of the genesis of the world trading system and moves on to examine the key issues as they relate to developing countries. These include further liberalization of agricultural trade; abolition of the Multifibre Arrangement; environmental and labour standards; competition policy; regional integration in South East Asia; and the implications for developing Asian countries of the liberalization of the Chinese economy and its WTO membership. Furthermore, the book discusses the links between trade liberalization and poverty reduction – drawing on the experience of Asian countries – and puts forward arguments on how trade liberalization could effect a greater reduction in poverty.

Chapter 5: Environmental standards and trade in agricultural products: evidence from Brazil, Germany and Indonesia*

Ulrike Grote, Claus Deblitz and Susanne Stegmann

Subjects: business and management, international business, development studies, development economics, law and development, economics and finance, development economics, international economics, law - academic, law and development


Chapter 5 11/2/02 1:14 pm Page 1 5. Environmental standards and trade in agricultural products: evidence from Brazil, Germany and Indonesia* Ulrike Grote, Claus Deblitz and Susanne Stegmann International trade in agricultural products takes place among countries at different levels of development that have varying preferences for maintaining environmental standards. At the same time, the awareness of and emphasis on environmental problems and food safety issues have grown at the global, regional and national levels. Some of the main concerns include climate change, ozone depletion, soil degradation, vanishing biodiversity, deforestation and smoke from forest burning, mad cow disease and transgenic food products or genetically modified organisms. This situation has led to conflicting positions between the industrial and the developing countries. The industrial countries demand the enforcement of higher environmental and food safety standards to ensure that environmental costs are internalized and the safety of agricultural products is secured. However, at the same time they fear losing international competitiveness because higher environmental standards lead to higher production costs. Developing countries, by contrast, fear that the industrial countries might use environmental standards as nontariff barriers, leading to restricted market access and the loss of competitive advantage. In the context of WTO negotiations, this means that the industrial countries often wish to include environmental issues in the trade agenda, because the WTO offers the possibility of using trade sanctions or import bans as enforcement measures for raising environmental standards abroad, especially in developing countries. However, many developing countries perceive the entwining of...

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