Ambassador Langman,
Excellencies,
Ladies and Gentlemen,
good morning
In 1994, two major trade events took place: one was the Marrakech declaration which gave birth to the WTO, the other one was the Bogor declaration which set APEC in motion. Of course the two models of international trade cooperation initially looked perfectly opposite:
- The WTO was promoting a model of hard-law through enforceable multilateral or plurilateral agreements aiming at balancing trade concessions from participants.
- The APEC had chosen a soft-law model, based on non-binding agreement on collective objectives and individual implementing measures.
Ladies and Gentlemen, I believe that times have greatly changed since then.
My key message today is that the APEC and the WTO models of trade cooperation have been converging much more than initially expected over the last 30 years; and I also think that the topic of sustainable development holds a great potential for more convergence in the future. This is why it is my privilege to address your working group. I have no doubt that what you are doing here is very relevant to the WTO
There are four reasons why I believe this to be true.
First, let’s face it, the classical opposition between soft-law and hard-law, binding or non-binding, has become partially irrelevant. At least, within the WTO we have been observing quite a variable geometry in the way we approach rulemaking.
De facto, the WTO has recognised the notion of non-binding commitments from its Members. For instance, our agreement on Trade Facilitation, if not intrinsically soft law, fully recognises the possibility of “opting in” for some of the proposed commitments. In other areas, such as the SPS or TBT we have been negotiating non-binding guidelines. There are other areas where WTO Members have collectively set some guidance and political objectives but have let them to be implemented through individual government’s actions.
So the WTO has moved away from a “one size fits all” model of trade agreements. That is a first element of convergence.
Second, the WTO is increasingly looking at sustainable development goals. This is an area where APEC has clearly been pioneering. APEC was able, before most, to agree on a list of 54 Environmental Goods to facilitate trade in back in 2012.
And it has yielded concrete results, as APEC’s exports and imports of those 54 products increased by 5.7 percent and 13.5 percent, respectively, between 2012 and 2019.
Today, the WTO itself has also entered a green moment with very significant new initiatives focusing on sustainable development.
- At our last Ministerial meeting last year we concluded a landmark agreement on reforming subsidies to fisheries: it was about prohibiting subsidies contributing to illegal fishing. Our Members are now ratifying this agreement — Singapore was the second Member of WTO to do so, very recently. Members are now in the second phase which is about reforming subsidies contributing to overfishing and overcapacities. Here for the first time, the WTO has concluded a trade agreement whose main purpose is to contribute to ocean preservation, conforming with SDG goal 14-6.
- At the same Ministerial Meeting, our Members for the first time formally recognised the contribution of the multilateral trading to the fight against climate and other environmental crisis.
- Several WTO Members also co-sponsor three environmental initiatives: the trade and environmental sustainability discussions (supported by 74 Members representing 85% of global trade), the Fossil Fuel Subsidy Reform initiative (supported by 48 Members representing around 40% of global trade), and the Dialogue on Plastics Pollution (75 Members representing 75% of global plastics trade).
These various approaches can complement each other: for instance, keeping the fish in and taking the plastic out of the ocean are obviously the two sides of a same coin.
Here we have a second element of convergence between our two models.
Third, the APEC model of setting a collective direction and relying on individual implementation could prove innovative and inspiring for the WTO when it comes to mobilising trade policy for sustainability objectives.
There is a very strong rationale for this: when and where trade policy is driven by sustainable development goals, the game is not about exchanging and balancing trade concessions for market access of private goods; what is at stake is the production of global public goods such as the preservation of the oceans, the biodiversity or the climate. Producing public goods is not a zero-sum game but a “win-win” process: every additional effort counts for the common purpose.
This is also the rationale that lies at the heart of the Paris agreement, which sets collective goals and relies on national determined contributions to achieve them. Does this methodology look familiar in an APEC context? Would it be possible to consider in the WTO? Actually we already have two key elements in place for this to happen.
- The first one is that our Members are more and more active in mobilising their trade policy in favour of the environment. We monitor this through the notification of trade measures. Overall, since 2009 the number of environmentally related trade measures has reached 17’000, almost tripling from a pace of 829 annual measures notified in 2009, to 2250 in 2021. This covers all main areas of environmental concerns and all policy tools. So, it is documented that our Members are already acting individually.
- The second element is that our Members have created the fora that make possible the design of collective goals and action. Of course, our Committee on Trade and Environment is one, but also the three environment initiatives that I previously mentioned on trade and environmental sustainability, fossil fuels, plastics.
So, we already have the fora for collective goal setting and the willingness for individual, tailor-made implementation through trade measures. Doesn’t it look like we are ready for action?
This will be my fourth point: what is the type of action that our Members are considering today? Let me focus on the example of the plastic initiative.
First, there is the idea of promoting sustainable and affordable alternatives and substitutes to plastic and technologies contributing to the Basel Convention Plastics Wastes Amendment. There is now an emerging list of some key goods and services(1) that could be traded more.
A second area relates to trade action focusing on single-use plastics and other harmful and unnecessary plastics. We can see that single-use plastic products, packaging and harmful plastic wastes(2) are top of mind with our Members. We can see emerging a list of “worst offenders” where our Members are already acting. Concerted action on this, including best practices, guidelines and harmonisation could make a concrete contribution. Another policy commitment that would make sense is to restrict/regulate the export of those goods also restricted/regulated in the domestic market.
Third, our Members are building up into a Catalogue of trade-related plastic measures, including regulatory requirements, price and market-based mechanisms and support policies used by Members to address plastic pollution. This would allow Members to fuel domestic trade action plans to help address plastic pollution and potentially pledge to do so at MC13 following clear timelines
Ladies and Gentlemen, my hope is that the work that you are leading here within APEC can again show how trade can deliver meaningful results for sustainability. You can inspire, the efforts that we have started within the WTO. As you have clearly got from my messages, I see no reason for opposing different sorts of trade policy approaches when it comes to promoting public goods and a sustainable economy. Bogor and Marrakech together for the environment! That is my call today.
I thank you for your attention.
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