Practical Challenges in Negotiation for Environmental Provisions under

Practical Challenges in Negotiation for Environmental Provisions under RTAs MIYAKE, Yasujiro METI, Japanese Government Email : miyake-yasujiro@meti. go. jp 19 June 2007 Presentation for OECD workshop on Regional Trade Agreements and the Environment

Evolving environmental provisions of Japanese RTAs Singapore (2002) Cooperation in the field of environment Not to relax environment measures as an encouragement for investment Working group on environment Implementing agreement Art. 31 Mexico (2004) Malaysia (2005) Philippines (2006) Chile (2007) Art. 147 Inc. CDM, environmental goods and services, business alliances Art. 140 (g) Inc. CDM, environmental goods and services Art. 144(d) Joint statement Art. 9(iv) CDM, business alliances Joint statement Att. 3. No. 6 Art. 153(f) (inc. CDM) Art. 74 Art. 90 Art. 102 Art. 87 Art. 111 Working Group on Energy and Environment Implementing agreement Art. 36 Subcommittee on Science, Technology, Energy and Environment Implementing agreement Art. 46 Reaffirming intention to pursue high level environment protection to fulfill its international commitments Joint statement Att. 3 No. 1 Harmonising its environmental laws and regulations with its international commitments Joint statement Att. 3. No. 2 Promote public awareness Joint statement Att. 3. No. 5 Transboundary movements of hazardous waste Thailand (2007) Press release Exchange of letters between Ministers of Foreign Affairs 1

Major environmental elements to discuss 1. Strict control over transboundary movement of hazardous wastes 2. Environmental goods & services (1) Market access (2) Government procurement 3. High-level environmental protection as improvement of investment conditions (1) Not-to-relax clause (2) Effective enforcement (3) Promotion of public awareness (4. Cooperation) (5. Working group) Challenges? (1) Intra-governmental (2) With negotiating partners 2

Element 1: Strict Control over Transboundary Movement of Hazardous Wastes Typical criticism based on misunderstandings “RTA aims to promote exportation of hazardous wastes. ” Complaints from NPOs in e. g. the Philippines, Thailand, & India 3

Element 1: Strict Control over Transboundary Movement of Hazardous Wastes Need for clarification on our position: Strict control under the Basel Convention should address the concern. 1. Tariff reduction is not directly connected with this issue. - Tariff correspond with the Basel definition of wastes. - Some wastes (e. g. HS 382520 Sewage sludge, HS 382530 Clinical waste), but the WTO Agreement provides that tariffs must be eliminated on substantially all the trade (GATT Art. 24(8)). Japanese government never intends to promote trade in hazardous wastes by way of tariff reduction. 4

Element 1: Strict Control over Transboundary Movement of Hazardous Wastes Need for clarification on our position: Strict control under the Basel Convention should address the concern. 2. Japanese government implements strict control over hazardous wastes under the Basel Convention. - No confirms, and the importing country gives a written consent. overnment atory ns olds- The on Basel Conventions and relevant regulations. -government The workshops holds also countries Asian with to exchange information in order to prevent unlawful trade in hazardous waste. 5

Element 1: Strict Control over Transboundary Movement of Hazardous Wastes Challenges: 1. Better internal coordination may be necessary for greater accountability. sections - Relevant foreign embassies, MOFA, MOE, METI (sections for Basel Convention, RTA, chemical industry etc. ) - An Strategic Approach to International Chemicals Management (SAICM) in May 2007 6

Element 1: Strict Control over Transboundary Movement of Hazardous Wastes Challenges: 2. RTA negotiating partners may need some time to get familiar with the issue. 7

Element 1: Strict Control over Transboundary Movement of Hazardous Wastes Challenges: 2. RTA negotiating partners may need some time to get familiar with the issue. a - Having goal, but it may have a practical significance in securing slots for negotiation. emally otiation roups chapters in the Agreement. (e. g. Trade in goods, Trade in services, Investment, Intellectual Property Rights) - In include the issue at least in the Terms of Reference. 8

Element 2: Environmental Goods & Services RTA may be an appropriate vehicle for better market access to environmental goods & services ental - on Discussions going on at the Doha Development Agenda at the WTO, but stuck on definition of environmental goods. bilateral RTA relationship provide may better chance to agree on the definition of environmental goods. - environmental market Better access to services may also competitive in providing environmental consultations. 9

Element 2: Environmental Goods & Services Challenges: 1. Governments are often unprecedented. Possible counterargument: reluctant to do something 10

Element 3: High-level Environmental Protection as Improvement of Investment Conditions “Not to Relax as an encouragement for trade & investment” clause is often added. High-level environmental protection will serve for improving investment conditions. Promoting public awareness may also count. Effective enforcement may be important. METI pays more attention to investment condition improvement in RTA partner countries. - Cf. NAFTA side agreement on environment appears to aim at prevention of “race to the bottom” in lowering environmental regulations so as to become more trade competitive. Challenges: Some countries may need some time to see the benefit of investment condition improvement. Trade competition aspect may play more roles. 11

Some implications 1. Better exchange of views between the negotiating partners may bring about fruitful results especially in case of strict control over transboundary movement of hazardous wastes & high-level environmental protection as improvement of investment conditions. 2. Discussions at an early stage e. g. at a joint study group are important. This will also lead to mandates to negotiate. 3. Greater accountability toward the public, including NGOs, will help in smooth negotiation/implementation. Better coordination within a government may be useful. 12