ADB_book_18 April.qxp - Himalayan Document Centre - icimod

well as other provisions in specific countries orregions, a number of reasons have been identified.Precautionary PrincipleRio Principle 15 points out that where there arethreats of serious or irreversible damage, lack ofscientific certainty shall not be used as a reason forpostponing cost effective measures to preventenvironmental degradation (UN 1992). The principlewas to protect the environment and public healtheven when scientific information was consideredinsufficient regarding the potential impact of aproduct or technology. It is clear that even theslightest suspicion can result in the use of this principle.Opponents of this argue that it can be easily usedas a trade barrier. Many countries have already usedthis principle in the regulation of biotechnology andgenetically modified foods, hazardous chemicals,and invasive and alien species.Sanitary and Phyto-sanitary MeasuresSanitary and Phytosanitary Measures set out thebasic rules for food safety and animal and planthealth standards in international trade (WTO 1998).Countries can also set their own standards, whichmust be scientifically based and should not bearbitrary or discriminatory between countries wheresimilar conditions prevail. Critics argue that becauseof its technical complexity, this has been very difficultto challenge and could be a very effective tradebarrier in the future. Another point is that standardscannot be the same everywhere because of widedifferences in living environments, and adjustmentsneed to be made for this.Technical Barriers to TradeTechnical barriers to trade deal with GATT rulesgoverning the use of product standards. TheAgreement gives countries the flexibility to takenecessary measures to protect the environment,provided these are not discriminatory or traderestrictive (Jha 1999). The Agreement covers alltechnical regulations, voluntary standards, andprocedures to ensure that these are met, exceptwhen these are sanitary and phyto-sanitary-relatedas defined by the Agreement. The two Agreementshave many common elements.Production and Process MethodsProducts cannot be discriminated against based onthe manner in which they were produced. Forinstance, timber produced by clear felling should notbe discriminated from timber produced bysustainable forest management. However, someexceptions are permitted. One very prominent caseregarded the dolphin-shrimp-turtle case brought tothe WTO Panel by some member countries againstthe restrictions imposed by the US (Jha 1999).EcolabelsEcolabels are a method of providing information tothe consumer that the product is environmentallysafe in its production and contents. This is now beingincreasingly used as a requirement for enteringmarkets in the US, EU countries, and Japan.Mandatory labeling of genetically modified foods isrequired by EU, Japan, and Australia, while the USand Canada have complained that such labelingviolates WTO rules (Chaturvedi and Nagpal 2003).All the developed countries have developedtheir own ecolabels for textiles, and developingcountries are encouraged to use these ecolabels iftheir products are to be competitive in thesemarkets. The use of ecolabels is voluntary butbecomes unavoidable if others are using it in theirproducts. Ecolabels have raised many other issuesregarding establishment of standards, certification,credibility of certifying authority, competentlaboratories and their staff, and harmonization ofstandards among countries that have also beenraised under sanitary and phyto-sanitary measuresas well as technical barriers to trade (UNDPundated).SubsidiesWTO agreements have attempted to lower subsidiesacross the board. While reducing subsidies onmanufactured products has been accepted,subsidies in agriculture and fisheries have become ahighly contentious issue in the WTO. Developingcountries have been particularly concerned aboutthe high level of subsidies provided to agriculture inthe EU and the US (Bardhan 2001).InvestmentsOne objective of liberalization is to attract foreigncapital. However if this is done without anyenvironmental safeguards, it could be very damagingto the local environment as well as unfair to otherswho have instituted industrial environmentalstandards. One recent study (Busse 2004) indicatedthat there is no rush of industries to pollution havens.The only exception may be the iron and steelindustry.ServicesThere has been a move within WTO to pressurecountries to liberalize service sectors such as188 Environment Assessment of Nepal : Emerging Issues and Challenges