RESTRICTED  
  
WT/CTE/M/59  
 
3 September 2015  
(15-4568)  Page: 1/27  
Committee on Trade and Environment   
 
 REPORT OF THE MEETING HELD ON 22 JUNE 2015 
NOTE BY THE SECRETARIAT1 
The Committee on Trade and Environment (CTE Re gular) met on 22 June 2015, chaired by the 
Permanent Representative of Hong Kong, China, Ms. Irene Young. The Committee adopted the 
Airgram, WTO/AIR/CTE/1, issued on 1 June 2015. The latest list of documents of the 
Committee was circulated on 3 May 2013 in document WT/CTE/INF/5/Rev.11 . The Report of 
the last CTE meeting, held on 23 October 2014, is contained in WT/CTE/M/58 .  
_______________ 
  
Contents 
1   PARAGRAPH 32(I) ....................................................................................................... 3  
1.1   Energy efficiency .......................................................................................................  3 
1.1.1   The European Union's experience .............................................................................. 3  
1.1.2   Singapore' s experience ............................................................................................ 4  
1.1.3   Thailand's experience .............................................................................................. 5  
1.1.4   Chile's experience ................................................................................................... 7 
1.1.5   Pakistan's  experience .............................................................................................. 7  
1.1.6   Chinese Taipei's experience ..................................................................................... 10 
1.1.7   Canada's  experience .............................................................................................. 10 
1.1.8   Briefing by the Organization for Ec onomic Co-operation and Development (OECD) .......... 11 
1.1.9   Briefing by the International Organization for Standardization (ISO) .............................. 12 
1.2   Illegal Logging .........................................................................................................  14 
1.2.1   Malaysia's experience ............................................................................................. 14 
1.2.2   Russia' s experience ................................................................................................ 15 
1.3   Fossil Fuel Subsidy Reform ......................................................................................... 16 
1.4   China's experience on Ecol ogical Civilizati on Strategy .................................................... 18 
2   PARAGRAP H 32(III ).................................................................................................. 18  
2.1   China's Environmental Labelling Programme ................................................................. 18 
2.2   Chinese Taipei's Green Mark Programme ...................................................................... 19 
3   OTHER BU SINESS ...................................................................................................... 20  
3.1   Environmental goods agreement negotiations ............................................................... 20 
                                               
1 This document has been prepared under the Secret ariat's own responsibility and is without prejudice 
to the positions of Members or their rights and obligations under the WTO. WT/CTE/M/59 
 
- 2 - 
 
  3.2   Environmental provisions of China's Free Trade Agreements (FTAs), in particular 
China-Korea FTA .............................................................................................................. 21 
3.3   Briefings by ob server orga nizations ............................................................................. 22 
3.3.1   Briefing by the United Nations Framework Convention on Climate Change 
(UNFCCC)  ...................................................................................................................... . 22 
3.3.2   Briefing by the OECD .............................................................................................. 23 
3.4   Briefing by the WTO Secretariat on developments in other international 
organizations ................................................................................................................. . 25 
3.4.1   Briefing on recent developments regarding the Post-2015 Development Agenda 
process, including United Nations Sustaina ble Development Goals (SDGs) and the Third 
International Conference on Financing for Development in Addis Abab a (FfD) ........................... 25 
4   DATE OF NE XT MEETING ........................................................................................... 25  
ANNEX 1: ITEMS OF THE CTE WORK PROGRAMME .......................................................... 26  
ANNEX 2: PARTS OF THE DOHA MINISTER IAL DECLARATION THAT RELATE  TO 
THE WORK OF THE CTE .................................................................................................. 27  
 
 
_______________ 
 WT/CTE/M/59 
 
- 3 - 
 
  1  PARAGRAPH 32(I)  
"The effect of environmental measures on market access, especially in relation to 
developing countries, in particular the least-developed among them, and those situations in which the elimination or reduction of trade restrictions and distortions 
would benefit trade, the environment and development."  
1.1.  The representative of Argentina made the point that topics on the agenda for the meeting, 
such as energy efficiency, needed to be discu ssed in line with the mandate of the CTE under 
paragraphs 32(i), (ii), (iii), 33 and 51 of the Doha Ministerial Declaration, in particular the effect of 
measures on market access of developing countries.  
1.1  Energy efficiency 1.1.1  The European Union's experience  
1.2.  The representative of the European Unio n presented the New Energy Union Strategy, which 
was based on five interrelated dimensions: energy efficiency; energy security; a fully integrated 
European energy market; decarbonisation of the economy; and research, innovation and 
competitiveness. The European Union's energy e fficiency policy was governed by directives 
addressing different aspects: (i) energy efficiency , a broad framework that had put in place targets 
for the EU member States; (ii) energy performa nce of buildings; (iii) ecodesign that had set 
minimum energy performance standards for products  that were placed on the EU market; (iv) 
energy labelling; and (v) a framework to finance energy efficiency.  
1.3.  The representative explained further that the EcoDesign directive intended to push the supply 
side towards more environmentally friendly and en ergy efficient products by eliminating the worst 
performing products from the market. On the other hand, the Energy Labelling directive was 
meant to pull the market by addressing the demand side and providing consumers with information about the most efficient products on the market.  
1.4.  The EcoDesign directive established the framework under which minimum energy 
performance standards were adopted. Both locally produced and imported products that did not meet the mandatory requirements set by the EcoD esign directive to improve their environmental 
performance could not be placed on the European market. The products covered by the 
EcoDesign directive included products with a sizeable share in the market; products that could have a significant environmental impact; and prod ucts with a potential for improvement without 
incurring excessive costs or impairing the products' functionality, health and safety, affordability or 
the industry's competitiveness.  
1.5.  In addition, the Energy Labelling directive set out a labelling system that ranked products 
according to their energy efficiency on a scale from A to G. The directive not only provided 
consumers with information on energy efficiency, but also encompassed other environmental 
impacts, such as water consumption.     
1.6.  The representative indicated that the draf ting process of EU measures was transparent and 
inclusive and the rules were developed in close cooperation with both EU and non-EU stakeholders. 
Non–EU stakeholders could be directly involved in the process or through their associations at the European level. All implementing measures for individual product groups were notified to the WTO. The policy was applied in a non-discriminatory manner, as the same rules applied to EU and non-
EU economic operators. It was a science-based ap proach based on extensive technical and market 
studies of the product groups.  
1.7.  The EcoDesign and Energy Labelling dire ctives had achieved considerable energy and 
greenhouse gas (GHG) emission savings and it was estimated that by 2020 the energy savings per 
year would be more than the annual primary energy consumption of Italy. The policies had also resulted in significant monetary savings, for both households and the industry.  
1.8.  Other EU policies that related to the energy efficiency of products included: the 
ENERGY STAR, a voluntary appliance-specific label for energy efficient office equipment (for WT/CTE/M/59 
 
- 4 - 
 
  computer displays and imaging equipment); and th e EU tyre labelling measure focused on fuel 
efficiency (rolling resistance), wet grip and external rolling noise.  
1.9.  Finally, the representative of the Europe an Union provided some insights into future 
developments of the policy: reviews of several regulations for individual product groups were 
ongoing to ensure that they were up-to-date and reflecting technological progress; measures to 
strengthen market surveillance were being develope d; further international cooperation with trade 
partners was envisaged to facilitate regulatory and standards convergence. In addition, the 
European Union was in the process of reviewing some parts of the EcoDesign directive and the 
Energy Labelling directive, including improving the effectiveness of the label by rescaling back the 
A to G classification (rather than continuing adding plusses to category A).     
1.10.  Recalling Argentina's earlier intervention, the representative of India enquired whether the 
European Union had conducted a study on the impact of their policies on trade flows from 
developing countries; and if so, with what results. 
1.11.  The representative of Egypt asked whether the European Union conducted capacity-building 
activities to inform exporters about the process and assisted with implementation.  1.12.  The representative of the European Unio n confirmed that in 2014 they undertook a study 
that evaluated the impact of the EU EcoDesign and Energy Labelling schemes on third countries. 
The study, publicly available on the EU website, did not reveal a restriction on trade flows but 
found that the Energy Labelling scheme, in particular, had a number of followers in third countries as they either directly adopted the EU label, or the EU label served as an inspiration for their national measures. He also confirmed that there were training activities in third countries in 
relation to the policy. He reiterated that the European Union was engaged directly with countries 
that were interested in understanding and lear ning about the policy. The European Union had 
extensive exchanges with, for example, the Kin gdom of Saudi Arabia on the EU Labelling and 
EcoDesign programmes for air conditioning equipment.  
1.1.2  Singapore's experience   1.13.  The representative of Singapore explained Singapore's approach to sustainable development 
as well as the key role played by energy efficiency  policies. The first of five tenets of Singapore's 
approach to sustainable development was that climate change mitigation required not only increased use of renewable energy but also greater efficiency in the use of fossil fuels. Literature 
showed that fossil fuel combustion accounted for around 90 per cent of total CO
2 emissions. 
Moreover, energy efficiency was a means of increasing economic competitiveness.  
1.14.  The second tenet was the absence of policy contradiction between pursuing environmental 
objectives and WTO law. The representative recalled that the Marrakesh Ministerial Decision on 
Trade and Environment said: "[t]here should not be, nor need be, any policy contradictions 
between upholding and safeguarding an open, non-discriminatory and equitable multilateral trading system on the one hand, and acting for the protection for the environment, and the 
promotion of sustainable development on the other. ” The third tenet related to the importance of 
coherence and policy coordination multilaterally at the WTO and nationally among trade and environment agencies. Singapore's representative referred back to the first CTE report to the 
Ministerial Conference of 1996, where the CTE di scussed and shared the view that a dialogue at 
the multilateral level should be complemented by a national dialogue. 
1.15.  The fourth tenet of Singapore's approach was that each country had unique national 
circumstances which determined the type and scale of its environmental response measures. For 
instance, some Members needed to focus on povert y eradication; some small island Members with 
low-lying coastal areas had to concentrate on adaptation efforts; some lacked access to renewable energy sources. The final tenet involved the li beralisation and removal of barriers to energy 
efficiency products and services. Singapore's open  trade regime contributed to economic growth 
and helped address environmental challenges in an effective manner. 
1.16.  The representative of Singapore further ex plained that Singapore did not have any natural 
energy resources and relied almost entirely on im ports of oil and gas. Fuel and electricity were 
priced according to market supply and demand, and energy prices were not subsidised in order to WT/CTE/M/59 
 
- 5 - 
 
  reflect the real cost of energy. They thereby incentivised firms to make appropriate energy 
consumption choices and thus minimised energy waste. Singapore had moved towards a cleaner mix for electricity generation, switching from pure oil to natural gas, which had lowered the carbon content per unit of electricity generated. There was, however, a limit to the amount of emissions 
they could reduce by switching fuels. Natural ga s already constituted 84 per cent of the fuel mix 
for electricity generation in Singapore. While they continued to invest actively in research on clean energy technologies, there were limits to th e deployment of renewable energy sources in 
Singapore. Singapore was what the United Nati ons Framework Convention  on Climate Change 
(UNFCCC) termed an "alternative energy disadvan taged country". Some of the challenges that 
Singapore faced in terms of moving to renewable energy options included no possibility for biomass, geothermal, hydroelectric, tidal/wave, nuclear or wind energy. Solar energy was 
therefore the only viable option, but the small si ze and dense urban landscape was a challenge to 
solar energy deployment. In view of all the cons traints and challenges, energy efficiency was a 
core mitigation strategy for Singapore. 
1.17.  The representative highlighted some elements  of Singapore's energy efficiency strategy. It 
included promoting adoption of energy efficient measures and technologies by addressing market barriers to energy efficiency; building capacity to sustain and drive energy efficiency efforts; 
raising awareness; and supporting research and development.  
1.18.  Some energy efficiency measures applied across all sectors (e.g. Singapore Sustainable 
Blueprint) while others were sector-specific measures, such as: shifting to cleaner energy sources; improving industrial energy effici ency; greening buildings; shifting travel demand to low-emission 
modes and reducing vehicular emissions; improv ing energy performance standards of household 
appliances and promoting energy efficiency to ho useholds; and reducing emissions from waste and 
wastewater treatment.  
1.19.  Singapore also aimed to incorporate energy efficiency considerations in their trade policy. 
For that reason, they were party to the Enviro nmental Goods Agreement initiative, which would 
facilitate the deployment of, and access to, afford able energy efficient products and services.  
1.20.  The representative of Singapore concluded that Singapore's twin goals of economic growth 
and protecting the environment remained central to their national strategy. Moreover, Singapore would continue to take steps to reduce carbon emissions by building on past mitigation efforts. Finally, Singapore sought to ensure that their policies were consistent with their international 
obligations.  
1.21.  The representative of Nigeria was interested to learn what kind of market access barriers 
and challenges Singapore faced in terms of their strategy to promote energy efficiency and how 
they addressed those barriers and challenges. He also enquired how the process of inter-agency 
collaboration worked and what were the challe nges that Singapore faced in that regard.  
1.22.  The representative of the European Union enquired whether Singapore had a labelling 
program for consumers in addition to minimum performance standards for products. He also 
enquired whether the documents elaborating on these measures were publicly available.  
1.23.  The representative of Singapore indicated th at potential challenges included market failures, 
asymmetric information and situations whereby climate efforts infringed on other governmental 
priorities, such as health and social issues. In response, Singapore had a robust public consultation 
process. Singapore's report to the UNFCCC includ ed a diagram that showed  some of the market 
barriers they faced. Concerning the question on inter-agency collaboration, the representative of 
Singapore gave the example of the very structured  and robust inter-agency process that had been 
put in place for the UNFCCC negotiations; it wa s supported by the Deputy Prime Minister, and 
encompassed all the relevant ministers incl uding, Trade, Industry, Environment and 
Foreign Affairs.   
1.1.3  Thailand's experience  1.24.  The representative of Thailand provided an overview of Thailand's Energy Efficiency Policy 
and Implementation. In 2013, fossil fuels represen ted 95 per cent of fuel consumption in the 
transportation sector and 80 per cent in electric power generation. Thailand's energy intensity had WT/CTE/M/59 
 
- 6 - 
 
  consistently decreased since 2004, with about 1.4/1.5 per cent decrease every year, due to 
Thailand's policies and the restructuration of the economy. The demand for energy was higher 
than production and, therefore, a substantial part needed to be imported.  
1.25.  Thailand's Energy Efficiency Development Plan (EEDP) had been developed and endorsed by 
Cabinet in 2011. It was a 20 year plan, aiming to reduce energy intensity by 25 per cent. To 
achieve this goal, several strategies were planne d with a particular focus on encouraging private 
participation.  
1.26.  The industrial and transportation sectors we re the focus of EEDP as they were the largest 
energy consumers. Various policy instruments were used depending on the sector concerned. The programmes related to energy efficiency included financial incentives, awareness raising, energy efficiency networking, technical support, and standards and regulations. There were several 
measures in place including the Energy Conservation Promotion Act and the Energy Conservation 
Promotion Fund. Thailand also had a dedicated agency, the Department of Alternative Energy and Energy Efficiency, to promote renewa ble energy and energy efficiency.  
1.27.  The Energy Conservation Promotion Act, established in 1992 with subsequent revisions, 
included provisions for energy management fo r large factories, equivalent to ISO 50001. 
Moreover, a Building Energy Code applied to buildings of 2000m
2 and above and encompassed 
building envelope, lighting systems and air conditioning systems, among others. The 
representative further presented Thailand's St andard and Labelling programme which had been 
launched 20 years ago and covered many types of equipment, and other products such as lighting, air conditioning, electric fans and refrigerators.  The representative explained further that the 
government coordinated successfully with loca l banks and used the Energy Conservation 
Promotion Fund as a revolving fund. The programme had supported more than 300 projects over the past 10 years.  
1.28.  The Energy Service Companies (ESCO) Fund was complementary to the revolving fund 
project but targeted small and medium sized projects. It was set up to promote investment in energy conservation and renewable energy deve lopment projects. The fund could be used for 
venture capital, equity investment, equipment leasing and technical assistance, among others. 
Since the beginning of its operation, it had already achieved significant energy savings.  
1.29.  Other energy efficiency programmes in cluded the promotion of ESCO business, the 
ESCO Information Centre, the ESCO fair, and the ESCO Association of Thailand. In respect of 
human resource development, Thailand had a capacity building program that offered 
comprehensive training courses for energy efficiency auditors, energy efficiency technologies and energy management systems. A miniature plant wi th a practical energy management facility had 
been constructed, where, for instance, participants could make adjustments to boilers and observe 
the resulting energy savings. Finally, the Thaila nd Energy Awards program took place annually and 
in 2014 it had been hosted together with the ASEAN Energy Awards to recognize people or 
factories that had contributed to energy efficiency.  
1.30.  The representative of Canada was interested to know whether Thailand also tracked energy 
use in kilowatts, gigajoules, or other similar units, as throughout the presentation Thailand 
indicated the measurement for energy consumption in kilotonnes. Kilotonnes, he said, was 
dependent on the fuel mix and therefore one could show energy reductions using this 
measurement by switching fuel types, for example coal to hydro, without actually reducing the 
energy use. Also, the representative asked what the energy saving was for the ESCO projects on 
average and the response from the private sector to these initiatives; whether there was extensive 
private sector engagement, and whether they ha d seen and appreciated the benefits. He also 
enquired whether there was an indication of the se ctors that were experiencing the fastest energy 
consumption growth. Finally, he asked whether Th ailand was planning on formally adopting the 
ISO 50001 energy management standard, in additi on to their national energy management 
system. 
1.31.  The representative of the European Unio n enquired whether the Thai national energy 
management system equivalent to the ISO 50001 was obligatory for companies or whether it was 
a voluntary scheme.  WT/CTE/M/59 
 
- 7 - 
 
  1.32.  The representative of Nigeria asked the representative of Thailand to elaborate on how 
energy pricing and the issue of capacity technologies were handled. 
1.33.  The representative of Thailand explained th at ktoe was a concept of universal energy units 
but one could have used gigajoule. Thailand used kt oe for its total energy mix but also had data in 
GWh. The saving magnitude of the ESCOs depended on  the type and size of the different projects. 
There were currently around 50 registered ESCO pr ojects and they varied between projects with 
small investments and savings, like lighting replacement, boiler efficiencies, and air conditioning 
systems, to larger projects with a very differe nt savings magnitude such as co-generation. The 
return on investment ranged from three to five years, while the small projects were likely to recover the investment much faster.  
1.34.  In terms of public and private participation,  the representative of Thailand said that they 
had a good working relationship with the Federati on of Thai Industries and the Thai Chamber of 
Commerce, which appeared to have been satisfied with the programs (both regulations and financial incentives). The ISO 50001 was obligatory for large industries only, not for small and 
medium-sized enterprises (SMEs). Members of the Ministry attended ISO 50001 seminars and 
included changes to ISO 50001 in the regulations to ensure that it was in line with international obligations. A fundamental function of Thailand's energy pricing was to reduce fossil fuel subsidies. 
Therefore, they removed subsidies for electric power, gasoline and d-cell.  
1.1.4  Chile's experience  
1.35.  The representative of Chile provided an over view of their energy efficiency challenges. 
Chile's energy consumption was twice the Latin American average, but only half the 
OECD average. Energy consumption was expected to continue growing. The overall goal was to 
increase energy efficiency with a view to re ducing energy consumption by 20 per cent by 
2025 relative to the baseline. Between 2005 and 2014, the focus had been on relatively simple initiatives such as education, communication an d awareness campaigns, appliance labelling, and 
the phase-out of incandescent lightbulbs. The gove rnment also established an Energy Efficiency 
Division within the Ministry of Energy, and a Chilean Agency for Energy Efficiency. Chile was 
drafting a new comprehensive Energy Efficiency Ac t. The Act would address the energy efficiency 
of large consumers, particularly the copper mini ng industry, which represented about 75 per cent 
of total energy consumption. It was considered particularly important to establish legal mechanisms both to encourage heavy industry to adopt energy efficiency measures, and to 
monitor the adoption of those measures. Regarding small and medium-sized enterprises, homes, 
and the government, the focus was on promoting best practices. Chile applied 20 to 25 different labelling schemes and used the European and the North American experiences as models.
 
1.36.  Raising awareness and educating the population about energy efficiency was a 
fundamentally important task. The government was committed to energy efficiency and had 
increased public funding for energy efficiency pr ojects by around 70 per cent. The process of 
addressing energy efficiency was in its early stages. Chile was ideally placed geographically to become more energy efficient and to increase its use of renewable energy sources. For example, in 
the desert they had 360 days of sunlight for solar power; there was potential for hydroelectric 
power too, given the many rivers running from the Andes Mountains into the Pacific Ocean.
 
1.37.  The representative of the European Union as ked Chile to elaborate on the energy efficiency 
measures in copper mining.  
1.38.  The representative of Nigeria enquired whether Chile could share some of their success 
stories in addition to the challenges. 
1.39.  The representative of Chile would refer the questions to his colleagues in capital. 
1.1.5  Pakistan's experience 
1.40.  The representative of Pakistan presented his country's renewable energy initiatives. He 
stated that there were 1.3 billion people without electricity, concentrated in Africa, Latin America, 
South Asia and East Asia. He referred to a study by the Nobel Prize laureate Richard Smalley called 
"Top 10 Problems facing Humanity in the next 50 years" which listed "energy" as the number one WT/CTE/M/59 
 
- 8 - 
 
  problem. Richard Smalley was of the view that a ddressing the energy issue would help resolve all 
others. 
1.41.  Pakistan, with 190 million people, was th e sixth most populated country in the world. 
Moreover, with 70 per cent of the population under 30 years old, it was expected that Pakistan 
would reach 270 million by 2030 and 350 million by 2050. This meant that Pakistan would need 
100,000 MW by 2030. However, today, Pakistan generated only around 20,000 MW. For example, a shortage of 4,000 MW, about 20 per cent of Pakistan's total energy today, caused complete 
black outs of up to 8-10 hours. 
1.42.  The representative said that Pakistan's energy mix was at the heart of the problem as 
70 per cent of their energy was thermal, 28 per ce nt hydel, very little nuclear and a negligible 
amount of wind energy. Pakistan's energy mix was dominated by fossil fuels, i.e. gas, diesel and 
oil, and was highly dependent on imports. The join t effect of the ever depreciating rupee and high 
crude oil prices was that the cost of energy in Pakistan was always on the rise, causing economic uncertainty. As part of the International Monetary Fund (IMF) facilitated economic reform, the 
government was undertaking a structural reform in the energy sector, ranging from phasing out 
subsidies to privatizing power distribution companies. 
1.43.  Given Pakistan's geographical situation, Pakistan had the potential to become a regional hub 
for trade and a transport corridor, provided the energy situation could be improved. Pakistan 
recently concluded the China Pakistan Economic Corridor, a US$46 billion investment that would connect the western parts of China with the Arabian Sea via a network of highways, railways and pipelines. 
1.44.  The representative explained that Pakistan  placed emphasis on hydro-electric, solar and 
wind energy in their plans to fill the energy gap. The criteria for a balanced energy mix were cost risk, price-related risks (changing oil prices), political risks (dependency on imported oil), 
operational risks or disruptions, scalability (how  flexible was the energy supply towards demand), 
on-demand availability, carbon emissions, and lo cal employment and skills. In terms of these 
criteria, solar, wind and hydro power had a substantial potential for Pakistan.  
1.45.  Pakistan was situated in one of the best solar zones in the world with an average solar 
radiation of 5.5 kW/m
2 per day and more than 300 clear days per year. In Pakistan, the average 
yearly radiation level was 1,900 kWh per square metre, compared to 1,100 kWh in Germany, which relied on solar for almost 50 per cent of it s energy. Pakistan preferred solar energy because 
it was a very "democratic" resource, available world-wide; it had a short gestation period and 
could be deployed speedily; there were minimum political problems (as compared to dams for example); the life cycle cost approach was economical in terms of $/kWh; there was minimum 
impact to water, which was a serious issue with other sources of energy; and it was highly reliable, 
easily available and scalability was not an issue.  
1.46.  As a developing country, the main challenge faced by Pakistan was the undercapacity for 
competitive procurement and contract management. A positive note was that the solar market was 
developing fast; over the previous decade sola r energy had experienced an approximate 48-fold 
increase and wind energy an 8-fold increase in their generation capacity. In addition, the cost per kWh for renewable energy was decreasing.  
1.47.  The key features of Pakistan's renewable energy policy included: a guaranteed electricity 
purchase; grid provision that was the responsibi lity of the purchaser (a government agency); 
protection against political risk and changes in law; attractive tariffs; no import duties on 
equipment; zero sales tax; no income tax, withholding tax or turnover tax; repatriation of equity 
along with dividends was freely allowed; and conver tibility of local currency into US$ was allowed. 
1.48.  Turning to the presentation of the Quaid- e-Azam Solar Park, the representative explained 
that Pakistan's government had allocated over 6,500 acres of land in the Cholistan desert 
(Bhawalpur) and provided infrastructure facilities such as access roads, water works, security, and 
land lease at US$1 per acre per year. There were also tax exemptions and a guaranteed return on equity at the rate of 18 per cent. Despite all these effort and 20 letters of intent being issued, the 
private sector was unwilling to respond as a result of Pakistan's serious security issues. 
Consequently, the first project was launched by the public sector itself. It had a total capacity of WT/CTE/M/59 
 
- 9 - 
 
  100 MW, was spread over 500 acres, its cost was US$131 million and was completed over the 
span of six months through a contractor, the Chinese TBEA Xinjiang SunOasis company. It was a good example of South-South trade. The governme nt created a special government owned entity. 
The management was led by a board of directors of  leading professionals from the private sector. 
Thus, within six months, 400,000 panels were set up in the desert and powered the grid.  
1.49.  The intention was therefore to pave the way for the private sector so that they would find it 
easier to replicate the Solar PV Project. However, a debate developed within Pakistan's energy 
sector about its viability. Utility companies resisted the initiative and raised arguments against it, 
including that: it did not work at night; it had high upfront costs; it was a new technology; it was more expensive than hydel; and that it needed a very informed and educated buyer. On the other 
hand, it was the government's experience that the peak demand matched peak generation; there 
were no fuel costs during the lifetime of the project; it had an extremely low construction time; it 
had a low tariff compared to diesel and furnace oil; it required negligible maintenance; and there were zero carbon emissions and water usage.  
1.50.  For wind energy, the southern part of Pakistan had a potential of 50,000 MW of wind power. 
The average wind speed was more than 7 m/s. At the moment, five projects, representing 255 MW of wind power, were operational and a further ni ne projects were under construction. There were 
also several projects of cumulative capacity (530 MW) at an advanced stage of development, four 
of which were part of the China Pakistan Economic Corridor.  
1.51.  The representative of Pakistan also explai ned that trade, energy and environment formed a 
triangle. He recalled WTO's commitment to sustainable development and protection and 
preservation of the environment. Climate change mitigation and energy security strategies were 
key themes for the government and they were aiming for a transition towards low-carbon and renewable sources. They believed that the solution to Pakistan's carbon-heavy energy mix was 
regional trade in renewable energy.  
1.52.  Pakistan was a committed partner in the "Sustainable energy for all" (SE4ALL) global 
initiative. Pakistan supported the three interlinked objectives of SE4ALL: providing universal access 
to modern energy services; doubling the global rate of improvement in energy efficiency; and 
doubling the share of renewable energy in the gl obal energy mix. A supportive international 
trading environment was needed to ensure renewa ble energy could provide a boost to green trade 
and green jobs. The Pakistani government's commitment to this cause was reflected in the duty-
free tariff treatment on all renewable energy technologies.  
1.53.  The representative of Nigeria noted Pakistan's potential for wind power and their ability to 
generate 50,000 MW and enquired to what extent Pakistan had explored this potential. He sought 
clarification regarding the incentives for consumers to change their behaviour. In the context of 
South-South cooperation, he enquired whether there was any cooperation or collaboration between Pakistan and Africa in terms of solar energy. His delegation noted the useful initiative of 
the solar park and was interested to learn whethe r it could be replicated in other countries.  
1.54.  The representative of the European Union wa s interested to learn what constituted the three 
main challenges to increasing the uptake of renewable energy. As a general comment, she said 
that given the importance of renewable energy to  the transition to a low carbon economy and the 
obvious linkages with trade and environment, the European Union would be interested in 
continuing this discussion in the Committee. 
1.55.  Concerning consumer behaviour, the representative of Pakistan explained that the per 
capita usage of energy was very low and that the challenge was rather that consumers did not 
enjoy a reliable and steady supply of electricity. That was the reason why the government did not expect consumers to reduce their usage. The repres entative reiterated that the supply possibilities 
were limited while they were experiencing an incr ease in the population and therefore in demand. 
This being said, the government had started a number of projects targeted at consumers, such as replacing light bulbs by energy saving ones for poor consumers. Also, the government made considerable efforts to educate consumers on different initiatives which could reduce energy 
waste. The representative was not aware of any collaboration with Africa; however he mentioned 
that German companies had assisted Pakistan with the contract management of their projects.  WT/CTE/M/59 
 
- 10 - 
 
  1.56.  Pakistan's representative identified the cost of capital as their biggest challenge. The second 
challenge for Pakistan was to receive best value for money from the vendors. There was thus a need for capacity building for the utility companies and government energy companies responsible for contract management.  
1.1.6  Chinese Taipei's experience 
1.57.  The representative of Chinese Taipei presented briefly domestic efforts to establish an 
energy efficient economy. Their policy objective was to create a "win-win-win" solution for energy, 
environment and the economy. They considered that sustainable energy development should 
balance the objectives of energy security, econ omic development and environmental protection, 
while considering the needs of future generations.  
1.58.  Since Chinese Taipei had insufficient natural resources, their sustainable energy policy had 
to support the efficient use of limited energy re sources and the development of a secure supply of 
clean energy. One target of Chinese Taipei's ener gy policy was to improve energy efficiency by 
more than 2 per cent per year and 50 per cent by 2025, compared to 2005, by means of further 
technological breakthroughs and proper administrative policies. They also promoted the 
deployment of energy efficient technologies and encouraged manufacturers to invest in research 
and development of energy efficient products, like LE D lightings. Also, the Bureau of Energy at the 
Ministry of Economic Affairs initiated the voluntary “Energy Label” program under which products 
that met the energy efficiency criteria were allowed to be labelled. The efficiency criteria were periodically reviewed and revised to reflec t new technology and product advancements. 
1.59.  The representative of Chinese Taipei stre ssed that new purchasing trends took the energy 
efficiency of products into consideration in addi tion to brand quality and price. Products with 
energy labels stood for high energy efficient products, which consumed less energy and hence saved operating costs. Energy efficiency had the potential to support economic growth, enhance 
social development, advance environmental sustaina bility, ensure energy security and help build 
wealth. Energy efficiency was the easiest and most cost effective way to combat climate change.  
1.1.7  Canada's experience 
1.60.  The representative of Canada stressed that energy efficiency is a significant focus of 
Canada's federal government environmental policy. Canada's ecoENERGY efficiency program was 
investing CAD $195 million between 2011 and 2016 to improve energy efficiency in Canada at 
home, at work and on the roads. This investment helped Canadian consumers in business save 
approximately CAD$1 billion annually in energy costs, while reducing greenhouse gas (GHG) 
emissions by 4 Mt, which were equivalent to about one million cars. Canada emphasized that the impact of Canada's energy efficiency policies were significant. It was estimated that the 
accumulating savings for all associated improvements from 1990 to 2010 accounted for 
CAD$34 billion. Canada was of the view that innova tion and efficiency could help economies grow 
and be more productive while reducing emissions. In this sense, since 2005 Canadian 
GHG emissions decreased by 5.1 per cent while th e economy grew by 10.6 per cent. The industrial 
sector was Canada's most energy intensive sector as it spent over CAD$42 billion each year on 
energy. In 2011, Canadian industry became more competitive by saving CAD$5.1 billion in energy 
costs through energy efficiency investments made between 1990 and 2011.  
1.61.  Canada highlighted a number of achievem ents under the broad umbrella of the ecoENERGY 
efficiency program. Canada was the first country to adopt the ISO 50001 Energy Management Standard for industry. In 2016, the adoption of the standard would be expected to result in 
CAN$26 million in cost savings. ENERGY STAR labels provided for over 65 product models with 
1000 industry partners that marketed ENERGY STAR and would generate CAN$410 million in energy savings to consumers in 2016. Canada's home energy rating system, which provided for 
estimates of the energy performance of a home , was at the core of the energy efficiency 
programme and regulations across the country. Under this programme, 26,000 efficient new homes were built with energy bills between 20 an d 50 per cent lower than homes meeting building 
codes alone. ENERGY STAR benchmarking for buildings would generate CAN$80 million in cost 
savings for building owners in 2016. The Federal Buildings Initiative also provided knowledge, 
training and expertise to support energy efficien cy retrofits in government buildings. Therefore, 
since 2011 one third of federal floor space had been addressed with energy saving projects, saving WT/CTE/M/59 
 
- 11 - 
 
  CAN$500 million annually. Finally, in 2014 over 32,000 trucks representing about 26 per cent of all 
on-road freight activity in Canada reported si gnificant energy reductions under the SmartWay 
Transport Partnership. This represented an average saving of more than CAN$6,000 per truck in fuel expenditures.  
1.1.8  Briefing by the Organization for Ec onomic Co-operation and Development (OECD)  
1.62.  The representative of the Organization for Economic Co-operation and Development (OECD) 
provided an overview of their recent work on incentive measures for energy efficiency with 
possible trade implications. This included the Energy Efficiency Market Report 2013 by the 
International Energy Agency (IEA), a paper on do mestic incentive measures for energy efficiency 
with possible trade implications and another one more specifically on electric vehicles and batteries.   
1.63.  According to the Energy Efficiency Mark et Report 2013, the rise of energy consumption 
since 1974 in a selection of 11 OECD economies
2 would have been significantly higher had it not 
been for energy efficiency improvements. It was estimated that the increase would have been 
from approximately 2,400 Mtoe up to 3,800 Mtoe. Th ese energy efficiency improvements included 
the use of more energy-efficient goods (as compared to equivalent energy-consuming goods) and of intrinsically energy-efficient products (e.g. insu lating materials, autoclaved aerated concrete).  
The report indicated that the market for energy-efficient goods was very large and was steadily 
growing. Public global investments in energy efficiency already amounted to US $300 billion in 
2011.   
1.64.  The OECD representative explained that the largest energy-savings potential was in the 
building sector. In 2012, China was the largest importer of insulating materials, followed by 
Germany, the United States, France and Canada. In the same year, world imports of insulating materials were worth around US$16 billion, follow ed by non-incandescent lamps and light-emitting 
diodes (LEDs). The price of LEDs was falling sh arply and it was expected that, over the next 
20 years, LEDs would largely replace normal incandescent lamps.  
1.65.  Large energy savings were expected to be reaped via electric appliances through smart 
networks. For instance, one could regulate the functionality of storage water heaters to make them 
work only when necessary. Furthermore, markets for private energy-service companies (ESCOs) were booming, particularly in OECD countries, some of them affiliated to equipment manufacturers or utilities.  
1.66.  With respect to targets, standards, code s and labelling requirements, OECD countries and a 
number of other countries had introduced building codes and labelling requirements for such codes. In France, in order to offer an apartment fo r sale, the estate agents were obliged to display 
a graph indicating the energy efficiency of that particular apartment and new buildings were 
required to meet a certain minimum level of energy  efficiency. Moreover, the majority of electric 
appliances in OECD countries had to comply with Minimum Energy Performance Standards, or 
similar regulations involving mandatory labelling . Additionally, a growing number of governments 
obliged energy utility companies to invest in energy efficiency. Consequently, these measures 
stimulated demand for energy-efficient products, particularly in insulating materials and double pane windows, amongst others. 
1.67.  Incentive policies included market-pull policies such as fiscal and financial incentives 
(e.g. direct grants, tax preferences and prefer ential loans), public procurement preferences 
(e.g. mandates for government buildings and schools) and support for energy audits. Numerous 
governments offered preferential loans to under take improvements in energy efficiency or 
acquisition of energy efficient equipment. Incentiv e policies also included technology-push policies 
such as support for Research, Demonstration and Development (RD&D) and support for 
manufacturing energy efficient appliances. Regard ing support for energy efficiency in industry, 
numerous countries supported energy audits especially targeted at SMEs, which usually were considered not to have the necessary financial and institutional capacity to do it themselves. Some OECD countries, for example Japan, established energy efficiency improvement targets for its 
industry.  
                                               
2 Australia, Denmark, Finland, France, German y, Italy, Japan, the Netherlands, Sweden, 
the United Kingdom and the United States. WT/CTE/M/59 
 
- 12 - 
 
  1.68.  Finally, energy efficiency policies were considered to be potentially trade enhancing as they 
increased demand and tended to draw in imports. However, the effects on trade depended on various factors, including energy prices and climatic conditions. For instance, some medium sized economies with low electricity prices applied high import tariffs on electronic appliances. This 
encouraged domestic production and sales of low-efficiency appliances as consumers were mainly 
concerned about the upfront cost rather than the r unning costs. Also, import tariffs on insulating 
materials were relatively low in most OECD countries but high in large emerging economies, in 
some cases up to 15 per cent. Furthermore, preliminary results for building-related technologies 
suggested that countries with high level of energy  efficiency commitments and large set of policies 
tended to have higher export competitiveness in energy efficiency technologies.  
1.69.  The representative of China asked how governments obliged energy utility companies to 
invest in energy efficiency and how Members we re able to ensure that fiscal and financial 
incentives were in compliance with the WTO covered agreements, as to avoid dispute settlement.   
1.70.  The representative of the European Union asked the OECD to elaborate on the different 
factors that conditioned the role of trade policy in promoting energy efficiency. 1.71.  The representative of the OECD noted that in  order to oblige electric utilities, countries such 
as the United States imposed certain public serv ice requirements through state regulations. These 
regulations usually established that in order for a company to receive a favourable price, they had 
to prove that they invested a certain amount in energy efficiency. The OECD elaborated on the role of trade policy in promoting energy efficiency by referring to factors such as technical barriers to trade and import tariffs, stressing the importance of the negotiations of a possible Environmental 
Goods Agreement and the potential posi tive effects that it would have.  
1.1.9  Briefing by the International Organization for Standardization (ISO)   1.72.  The representative of the International Or ganization for Standardization (ISO) provided an 
update of ISO work, specifically on ISO 50001 an d other energy standards, the ISO footprint 
standards and the ISO/TC 207 SC 7 survey.3  International standards were a way to promote good 
energy practices, support scientific cooperation and the harmonization of public policies, and 
improve consumers' and users' understanding and confidence. Standards had helped avoid 
technical barriers to trade and enabled the crea tion of world markets for energy technologies. 
1.73.  ISO 50001 on "Energy management systems - Requirements with guidance for use" had 
been published in 2011 and intended to help organizations to systematically plan and manage 
their energy use. Recently its committee had their plenary meeting in Mexico where discussions 
started about the revision of this standard. Development of the revised standard should take approximately three years and was expected to be published in early 2019.  
1.74.  The publication of ISO 50001 spawned a number of other supporting standards including 
ISO 50002 on energy audit requirements; ISO 50003 on  requirements for bodies providing audit 
and certification of energy management system s; ISO 50004 on guidance for the implementation, 
maintenance and improvement of energy manage ment system; ISO 50006 on measuring energy 
performance using energy baselines and ener gy performance indicators; and ISO 50015 on 
measurement and verification of energy performanc e or organization. Work had also been initiated 
on activities related to energy services especial ly for users, and commercial building energy data 
management for energy performance.  
1.75.  There were over 20 technical committees (ISO/TCs) involved in energy efficiency and 
renewable energy sources. Examples of committees  in the area of industrial energy efficiency 
included: ISO/TC 17 on steel; ISO/TC 115 on pumps; ISO/TC 117 on fans; ISO/TC 118 on 
compressors and pneumatic tools and equipment;  and ISO/TC 244 on industrial furnaces and 
associated processing equipment. These committees focused on developing energy efficiency 
standards, exemplified by ISO/ASME 14414, the Pump System Energy Assessment, which was 
developed jointly with the American Society of Mechanical Engineers and involved experts from 
both organizations. Other more recent committees working on energy efficiency included: ISO/TC 257 on the evaluation of energy savings;  ISO/TC 263 on Coalbed Methane; ISO/TC 265 on 
                                               
3 The subcommittee 7 of ISO/TC 207 is related to  GHG management and related activities and 
conducted a survey end 2014 with a focu s was on climate change standards. WT/CTE/M/59 
 
- 13 - 
 
  Carbon Dioxide Capture, Transportation and Geological Storage; and ISO/TC 285 on Clean Cook 
Stoves and Clean Cooking Solutions.  
1.76.  There were several committees focused on renewable energy, including ISO/TC 180 for 
Solar Energy and ISO/TC 197 for Hydrogen techno logies. There were separate committees for 
biofuels: ISO/TC 238 was created to focus on solid  biofuels and had published its first standards; 
one single standard on the sustainability criteria for bioenergy was in its final drafting stage and was expected to be approved by the end of 20 15. The ISO was also working jointly with the 
International Electrotechnical Commission (IEC) on a number of products, including a joint working 
group on wind turbines, common terminology on en ergy efficiency and renewable energy sources, 
and resource efficient data centres and green ICT. 
1.77.  There were also two committees that targeted the building sector: ISO/TC 163 on thermal 
performance and energy used in the built envi ronment and ISO/TC 205 on  building environment 
design. ISO/TC 22 specified standards for road vehicles. They carried out extensive work in the area of electric vehicles, hybrid-electric vehicles and fuel cell vehicles and had many standards on 
battery testing, energy consumption measurement and safety. They worked collaboratively with 
the World Forum for Harmonization of Vehicle Regulations (UNECE Working Party 29), the International Transport Forum (ITF) and the IEC.  Where there was overlap of work, resources 
were combined to form a joint working group. Early 2015, an International Workshop Agreement 
(IWA) on international harmonized methods for a coherent quantification of carbon dioxide emissions of freight transport was published, and it could become an international standard.  
1.78.  In 2013, TS 14067 on the GHG and carbon f ootprint of products had been published. This 
was followed by the TS 14046 on water footprint published in 2014. There were supporting 
materials and briefing notes on these standards available from ISO. 
1.79.  TC 207 subcommittee 7 conducted a survey in  late 2014 regarding the carbon footprint of 
products, technical specification 14067 and other climate change standards. The survey was sent 
to committee members and social media groups. Responses were received from 158 countries including many from developing countries. The results were not conclusive and included 19 
negative responses that required further analysis. The committee was using the results of the 
survey in the conversion of ISO technical specifications, specifically the product carbon footprinting technical specification which should be converted into an international standard by 2017. The ISO representative displayed a template of the surv ey and showed that the committee received many 
affirmative responses to the question of whether ISO climate change standards caused barriers to 
trade. While these comments did not constitute the majority of responses, the committee needed 
to analyse these results and formulate solutions.  
1.80.  The representative of China shared information about China's work on the standardization of 
energy efficiency. China had participated in the formulation of ISO 50001:2001 and prepared two 
core standards based on ISO 50001: GB/T23331-2012 on Energy Management System 
Requirements and GB/T29456-2012 on Energy Ma nagement System Implementation Guidelines. 
The Certification and Accreditation Administration of China (CNCA) began to certify the energy management system on a pilot basis, and by th e end of 2013, 37 accreditation institutions had 
certified more than 370 enterprises in estab lishing energy management system, covering 
13 industrial sectors including steel and iron, nonferrous metal, chemistry and electricity. While 
the Chinese Government encouraged enterprises to design energy management systems based on the two standards above, and made efforts to promote such standards (the CNCA was working 
with 16,000 key energy utility enterprises), they were mindful of avoiding a one-size-fits-all 
model. The energy management system was implemented on a voluntary basis. Clean and affordable energy was still a challenge in underdeveloped areas of China. 
1.81.  The representative of the Plurinational St ate of Bolivia asked whether ISO had analysed the 
effect of the standard on market access particularly for developing countries and enquired how 
those effects were to be assessed. Her delegation  was interested in how ISO members' opinions 
were reflected and expressed particular concern regarding the representation of developing 
countries in the survey. 
1.82.  The representative of India asked whethe r ISO was doing any work on the environmental 
impact of services as most of the focus seemed  to be on goods. Additionally, his delegation WT/CTE/M/59 
 
- 14 - 
 
  enquired about the International Workshop Agreement on freight transport and whether it covered 
all modes of transport or specifically the road sector.  
1.83.  The representative of Egypt shared the qu estions brought forward by the Plurinational State 
of Bolivia and India. His delegation would like  to know which social media groups had been 
consulted for the survey, and how ISO had ensured balanced representation of developing, 
developed or other community views. He further questioned whether it was now normal practice to take social media groups into consideration and what kind of criteria was used for such 
consideration.  
1.84.  The representative of the Bolivarian Repub lic of Venezuela stated that the development of 
ISO standards, including ISO 50001, must take into account the challenges and difficulties faced 
by developing countries to ensure that standards neither become discriminatory nor impair 
developing countries' market access. Standards should not be used as protectionist trade tools. 
Moreover, such standards adopted by developed countries on a voluntary basis should not be used as a basis for intrusive international action and should not create non-compliance situations for 
developing countries, as this would contradict the principles and goals of th e UNFCCC, in particular 
the principle of common but differentiated responsibilities.  
1.85.  The representative of Chinese Taipei note d the work carried out by IEC in concert with 
relevant committees within ISO on standards for energy storage of electrical vehicles. He asked 
about the challenges of electric vehicle standardization work and how ISO achieved collaboration between other standards organizations such as IEC and the automotive manufacturers.  
1.86.  The representative of Switzerland noted the relevance of ISO's presentation and welcomed 
such regulatory updates of their work. The represen tative enquired on the criteria of biofuel work, 
and where one could find such information.  
1.87.  The representative of ISO explained that, in accordance with ISO procedures, members 
consulted with stakeholders when they voted on draft international standards. He would provide 
details on the survey at a later date but mentioned that social media groups which participated in the survey included LinkedIn groups which discu ssed special ISO standards. The representative 
said that ISO/TC 242 was working on energy servic es to users, and tried to expand their scope 
from only technical standards to include other areas such as management and social responsibility. The representative explained that ISO and IEC ha d common directives of work regarding electric 
vehicles but some specifically related to only ISO or IEC. Collaboration was commonplace and work 
programmes were regularly exchanged. If the tw o committees were working on a similar subject 
they made a joint working group. ISO could pr ovide further information about biofuels if 
requested.  
1.2  Illegal Logging 
1.2.1  Malaysia's experience  1.88.  The representative of Malaysia provided an overview of actions taken by Malaysia to combat 
illegal logging. These actions comprised: (i) forest and timber certification; (ii) verification of 
legality, especially in response to legislation en acted by Australia, the European Union, and the 
United States; (iii) policies and legislation; and (iv) cooperation at regional and international levels. Malaysia was a major producer and export er of timber, with total export earnings of 
US$6.2 billion in 2014. The industry provided employment for around 300,000 people. 
1.89.  Regarding certification, the Malaysian Timber Certification Council developed and operated 
the Malaysian Timber Certification Scheme (MTCS), which became operational in October 2001. 
The MTCS was a voluntary, nation-wide scheme comprising forest management and chain of 
custody certification. It relied on third party compliance audits. Its requirements resulted from transparent stakeholder consultations. The MTCS had been endorsed by the Programme for the 
Endorsement of Forest Certification (PEFC), an d was recognized under the timber procurement 
policies of Belgium, Denmark, Finland, France, Germany, Japan, the Netherlands, Switzerland and the United Kingdom, and under several green building standards. About 40 per cent of Malaysia's permanent forest reserve had been certified, mainly under the PEFC. WT/CTE/M/59 
 
- 15 - 
 
  1.90.  Regarding verification of legality, Malaysia and Australia had jointly developed the Country 
specific guideline for Malaysia , which sought to provide guidance to Australian importers on the 
legality of imports of timber and timber products from Malaysia. Furthermore, Malaysia had made substantial progress in the negotiations of a Forest Law Enforcement, Governance and Trade 
Voluntary Partnership Agreement (FLEGT VPA) with the European Union. Pending the conclusion of 
these negotiations, Malaysia developed and implemented a Timber Legality Assurance System (TLAS) for purposes of due diligence when expo rting to the European Union. The FLEGT VPA was 
an important initiative that could contribute to combatting illegal logging. 
1.91.  Malaysia maintained several policies and laws related to forestry and timber. It also 
developed a National Action Plan for Combatting Illegal Logging for the period 2011-15. The action plan specified 10 priority areas and was geared towards achieving "zero illegal logging". 
1.92.  Regarding cooperation, Malaysia participated in several relevant regional and international 
bodies, including the United Nations Forum on Forests (UNFF), the International Tropical Timber Organization (ITTO), Asia-Pacific Economic Cooperation (APEC), and the Association of Southeast 
Asian Nations (ASEAN). Bilaterally, Malaysia was working closely with Australia and the 
Netherlands on forestry issues. Malaysia was committed to combatting illegal logging and stood ready to cooperate with other countries and initiatives. Combatting illegal logging and 
implementing proper certification were extremely challenging and required international 
cooperation and capacity building. 
1.93.  The representative of the European Union welcomed Malaysia's commitment to combatting 
illegal logging, which was a global issue with significant negative economic, environmental and 
social impacts. His delegation looked forward to the conclusion of the negotiations towards a 
FLEGT VPA, while expressing appreciation for the application of a TLAS pending the conclusion of 
the negotiations. He asked whether the MTCS covered Malaysia's entire territory and all types of 
timber. On a more general note, he noted that  the CTE had held interesting discussions on 
combatting illegal logging and would benefit from a summary of those discussions prepared by the Secretariat. 
1.94.  The representative of Australia noted that the specific guidelines would assist importers of 
legally logged timber from Malaysia to comply with Australia's legal requirements, while helping 
Malaysia to protect its valuable timber resources. Australia had finalized country specific guidelines with several countries besides Malaysia (Canada,  Finland, Indonesia, Italy, New Zealand, and 
Solomon Islands). 
1.95.  The representative of New Zealand reiterated her delegation's support for combatting trade 
in illegally logged timber. Such trade depressed gl obal timber prices, reduced the market share of 
the legitimate industry, and harmed the environment and local communities. A coherent and 
cooperative approach was the only way to tackle trade in illegal logging. It would be important to display as much transparency as possible when implementing or planning to implement measures 
to combat illegal logging. Her delegation echoed the request by the European Union for a summary 
by the Secretariat of the discussions on illegal logging in the CTE. 
1.96.  The representative of the Plurinational Stat e of Bolivia expressed doubts on the need for a 
separate summary of the presentations on illegal lo gging, given the availability of minutes for past 
CTE discussions and expressed a preference for continuing the usual practice of summarizing all 
CTE discussions. 
1.97.  The representative of Malaysia explained that his delegation was fully committed to 
concluding negotiations on a FLEGT VPA with the European Union; the few outstanding issues were 
not insurmountable. A FLEGT VPA established a lega lly binding baseline, which could be improved 
and strengthened through experience and capaci ty building. The MTCS was a domestic scheme 
applicable to the three regions where Malaysia's fo restry and timber industry operated; all timber 
products were covered under the MTCS. 
1.2.2  Russia's experience  1.98.  The representative of the Russian Federation presented their efforts to counter illegal 
logging and achieve sustainable forest management. Illegal logging pushed down timber prices, WT/CTE/M/59 
 
- 16 - 
 
  making it harder for legitimate loggers to compete and forcing them out of the market. Lost tax 
revenue due to illegal logging significantly reduced funding for forest conservation and supervision activities. Illegal logging was also responsible for often irreparable damage to the environment. The Russian Federation's forests were critical for the global environment, as they constituted about 
a quarter of the world's forests. Of the 203 million cubic meters of timber harvested in the Russian 
Federation in 2014, 21 million had been exported. More than 18,000 cases of illegal logging corresponding to about 1.3 million cubic meters of timber had been registered that same year. 
1.99.  In an effort to counter illegal logging, the government adopted the Roundwood Act in 
December 2013. The Act, which applied exclusively to legal entities, contained provisions on tracking the origin of timber. It provided fo r the establishment of a Unified State Automated 
Information System to register all timber transactions, and to document timber harvesting 
agreements and the volume of timber harves ted, among other data. The Act established 
mandatory marking of valuable species of timber (i.e. oak, beech and ash) for export. Countering illegal logging was important at both the federal and regional levels. Regional laws regulating 
timber had been introduced in 12 federal subjects of the Russian Federation. 
1.100.  The Roundwood Act and regional legislation had led to a decrease in the number of illegal 
timber transit sites. There had been an increase in the number of tax payers and fiscal revenue 
associated with the forestry sector. The overall damage caused by illegal loggers had fallen 
steadily. The Russian Federation was engaged in international cooperation, including the work of the APEC Expert Group on Illegal Logging and Associated Trade. 
1.3  Fossil Fuel Subsidy Reform 
1.101.  The representative of New Zealand played a short video entitled "Fossil Fuel Subsidy 
Reform and the Road to Paris".4 Her delegation's subsequent statement was delivered on behalf of 
the Friends of Fossil Fuel Subsidy Reform (FFFSR), a group of developed and developing, non-
G20 countries comprising Costa Rica, Denmark, Et hiopia, Finland, New Zealand, Norway, Sweden 
and Switzerland. The FFFSR sought to build po litical consensus on the need for reforming 
inefficient fossil fuel subsidies that encouraged wa steful consumption, and to promote the benefits 
of reform. 
1.102.  International reform of inefficient fossil fuel subsidies offered significant energy, 
environmental, fiscal and trade benefits. By keeping prices to consumers artificially low, fossil fuel subsidies encouraged wasteful consumption, put renewable energy at a disadvantage, and drained 
scarce public resources for sustainable development. The synergies created by the Climate Change 
Conference in Paris and the WTO Ministerial Conf erence in Nairobi offered an opportunity for 
collaboration on fossil fuel subsidy reform. Reform efforts were gaining momentum, with over 
50 economies committed to it. For example, G20 leaders committed to phasing out inefficient 
fossil fuel subsidies in September 2009, and APEC leaders made a similar commitment two months later. Nonetheless, energy su bsidies were still cons iderable; in 2013, governments spent more 
than US$600 billion on fossil fuels subsidies worldwide. 
1.103.  APEC and the G20 had a peer review process on efforts in fossil fuel subsidy reform. The 
benefits of peer review included increased tran sparency and accountability, and opportunities to 
seek expert advice and targeted assistance. Moreover, peer review could serve as a forum for 
highlighting successes and good practice, sharing ex periences, and facilitating policy dialogue. New 
Zealand had volunteered for peer review. A six pe rson review panel, comprised of five experts 
from APEC economies and one expert from th e OECD, visited New Zealand in March 2015. The 
review was conducted in accordance with APEC's voluntary fossil fuel subsidy peer review 
mechanism. Eight measures were selected for review. New Zealand had played an active role in selecting those measures, which had been identified in an OECD inventory of fossil fuel policies 
and could be perceived as providing support for th e industry. The review panel did not identify any 
inefficient subsidies that encouraged wasteful co nsumption in the eight measures selected, among 
other conclusions. The panel's preliminary findings would be finalized after being presented at the 49
th APEC Energy Working Group meeting in the Re public of Korea. The panel and New Zealand 
used the experience of a peer review to craf t a blueprint for future review exercises. Her 
delegation had found this to be an inclusive and useful experience and encouraged other WTO 
Members to participate. 
                                               
4 Available at: http://www.iisd.org/video/fossil-f uel-subsidy-reform-and-road-paris  WT/CTE/M/59 
 
- 17 - 
 
  1.104.  The FFFSR issued a Fossil Fuel Subsidy Reform Communiqué at the April 2015 meetings of 
the IMF and the World Bank. The Communiqué called on the international community to prioritize 
fossil fuel subsidy reform in 2015; to increase transparency on fossil fuel subsidies; to raise the level of ambition with respect to reform; and to provide targeted support for the poorest. Parties 
showcased progress on domestic fossil fuel subsidy reform and international cooperation initiatives 
in the Annex to the Communiqué. The Communiqué would be presented at the 21
st Conference of 
the Parties to the UNFCCC to support efforts to re ach a global climate agreement. According to one 
estimate, one-third of global carbon emissions du ring the period 1980-2010 were driven by fossil 
fuel subsidies. Her delegation encouraged additional WTO Members to join the Communiqué. By doing so, they would recognize fossil fuel subsidy reform as an important policy to mitigate the 
effects of climate change with economic, social and environmental benefits. At the launch of the 
Communiqué, France and the United States joined the FFFSR in supporting the document. 
1.105.  The representative of Norway said that it was useful and timely to raise the issue of fossil 
fuel subsidy reform in the CTE. The topic was rela ted to trade, the environment, and development. 
Fossil fuel subsidies had been estimated at US$548 billion in 2013. This was five times the global 
2020 target for low emissions and climate resilient investment, and four times the total amount of official development assistance from OECD coun tries. OECD and IEA research suggested that 
phasing out fossil fuel subsidies could result in a 12 per cent reduction in global GHG emissions by 
2020 and would free up financing for sustainable development, including education, health, infrastructure, renewable energy and technology. So me states spent up to 20 per cent of GDP on 
subsidies. Reform would help to level the playin g field for trade in renewable energy and energy 
efficient technologies. The decrease in the cost of renewable energy provided opportunities for 
avoiding the consequences of climate change without hampering economic growth. Putting a price on carbon was one of the most effective steps governments could take to encourage the private 
sector to invest in lower emission technologies. Norway had been one of the first countries to 
introduce a carbon tax, which had helped foster renewable energy and energy efficient solutions. His delegation encouraged additional WTO Members to join efforts to reform fossil fuel subsidies. 
1.106.  The representative of Thailand presente d their experience in phasing out subsidies to 
liquefied petroleum gas (LPG). Before the reform, Thailand kept the price of LPG for cooking below 
20 baht per kg, compared with a world market price of 32-40 baht per kg. From 2010, domestic consumption had to be met partly by imports, which totalled around 2 million tonnes in 2014. In 
February 2015 the government removed the subsidy and restructured the price of LPG to reflect 
the actual cost of production. The new price regime  led to higher domestic production of LPG and 
discouraged its wasteful use. Within three months there was a significant decrease in the demand 
for LPG. It was estimated that LPG imports would decrease to one million tonnes in 2015. 
1.107.  The representative of Switzerland stated th at the cornerstone of their energy strategy was 
the development of renewables and improvements  in energy efficiency. The Swiss Development 
Corporation promoted the removal of inefficient fossil fuel subsidies and supported fossil fuel 
subsidy reform in developing and transiting economies. His delegation welcomed progress by the G20 and APEC on this issue, including the decisi on by Germany to volunteer for peer review. In 
addition to Germany, China, New Zealand, Peru and the United States had undergone peer review. 
The year 2015 was a crucial year for the sustai nable development goals and the climate agenda. 
Relatively low oil prices strengthened the momentum  to reform inefficient fossil fuel subsidies. 
1.108.  The representative of Bolivarian Republic of Venezuela stated that peer review of fossil fuel 
subsidy reform was a voluntary exercise conducted in the context of the G20 and APEC. It had no 
relation to the WTO, which was not the appropriate forum to debate the issue. Moreover, peer review had not been endorsed by any of the forums in which the FFFSR had promoted their 
initiative, including the Rio+20 Conference. Decisions by the G20 and APEC should not be imposed 
beyond their respective memberships. His delegation was concerned that several delegations insisted on discussing the topic of fossil fuel subsidy reform at the WTO instead of focusing on tackling fisheries and agriculture subsidies, which were within the purview of the WTO and had a 
negative impact on trade and the environment. 
1.109.  The representative of the Kingdom of Sa udi Arabia echoed the views of the Bolivarian 
Republic of Venezuela and noted that the peer review exercise was a voluntary G20 initiative with 
no link to the WTO. The CTE was not the appropriate venue to discuss this initiative. WT/CTE/M/59 
 
- 18 - 
 
  1.110.  The representative of Canada stated that a discussion on fossil fuel subsidy reform in the 
context of the CTE's broad mandate was useful for purposes of information sharing, and that these 
discussions did not seek to influence the rights and obligations of WTO Members. Canada, along with other G20 and APEC members, had committed to rationalizing and phasing out, over the 
medium term, inefficient fossil fuel subsidies. Several tax preferences were being phased out in 
pursuit of that goal. 
1.111.  The representative of New Zealand explained that the topic of fossil fuel subsidy reform 
was within the mandate of the CTE. Fossil fuel su bsidies distorted the price of energy inputs and 
resulted in an inefficient allocation of resources,  thereby distorting trade. Moreover, the elimination 
or reduction of fossil fuel subsidies had been estimated to lead to a 12 per cent decrease in GHG emissions by 2020. The FFFSR were  not trying to influence the rights or obligations of WTO 
Members, or to prejudge negotiations in other forums. Her delegation considered that it was 
important to provide updates on relevant developments in this area, and indicated that it would continue to raise the issue in the CTE. 
1.4  China's experience on Ecol ogical Civilization Strategy 
1.112.  The representative of China presented thei r Ecological Civilization Strategy. Fast economic 
growth had led to adverse consequences for th e environment and posed challenges for long-run 
sustainable development. Although global supply  chains contributed to economic development, 
China had been receiving polluting industries from abroad. Building an "ecological civilization" was first put forward by China's leaders in 2012, and was subsequently elevated to a national strategy in 2015. The basic principles, general requirements and main goals of the Strategy were publicized 
in a document issued that same year. The Strategy's general requirements called on the 
government at all levels to support environmental protection and resource conservation along with economic and social development. The basic princi ples of the Strategy included: (i) intensifying 
environmental protection and conservation of natural resources, and supporting the natural 
recovery of ecological systems; (ii) promoting green, circular and low carbon development; (iii) deepening reform and encouraging innovati on; and (iv) raising public awareness of the 
importance of environmental protection. The major goals of the Strategy were to optimize land 
development and to increase resource efficiency, in cluding by reducing the carbon intensity of per 
capita GDP by between 40 and 45 per cent by 2020 from its 2005 level and increasing the use of non-fossil fuel energies to 15 per cent of total energy consumption. Additional goals sought to 
meet targets on forest coverage and control of desertification. The Ecological Civilization Strategy 
would be included in China's next five year plan to ensure nationwide implementation and steady progress. 
1.113.  The representative of the European Un ion acknowledged efforts to promote the green 
economy through a tailored approach such as the Ecological Civilization Strategy. The Europe 
2020 Strategy and its flagship initiatives, including the roadmap to a resource efficient Europe and 
the Seventh Environment Action Programme, were central to achieving green growth. There were 
many policy tools and approaches available to stimulate an inclusive green economy, including sustainable consumption and production patterns and the use of public procurement and consumer information to drive demand for green innovation. Well-designed regulations were supportive of 
the green economy too. His delegation was interested in learning what concrete actions China had 
taken under the aegis of the Ecological Civilization Strategy and how bilateral cooperation and dialogue on green growth policies could be strengthened. 
2  PARAGRAPH 32(III) 
"Labelling requirements for environmental purposes" 
2.1  China's Environmental Labelling Programme 
2.1.  The representative of China presented thei r Environmental Labelling Programme. The goal of 
the programme was to raise awareness among co nsumers of the importance of environmental 
protection, to inspire enterprises to manufacture in an environmentally friendly way, and to enhance the competitiveness of environmentally friendly products. The label used under the 
Programme certified that products were of high quality and met specific environmental 
requirements at different stages of their life cycl e. The label consisted of a logo that displayed the WT/CTE/M/59 
 
- 19 - 
 
  sun, a mountain, clear water, and ten rings to convey the message that all people are united to 
protect the environment. The programme was established in 1993 by the forerunner of the Ministry of Environmental Protection as a resp onse to the 1992 UN Conference on Environment 
and Development. The programme's logo was issued in August 1993, and the first China 
Certification Committee for Environmental Labelling Produce (CCEL) was created shortly 
thereafter. CCEL was responsible for guiding the Environmental Labelling Programme. The second 
CCEL was set up in 1999. A growing number of mini stries besides the Ministry of Environmental 
Protection participated in CCEL. Since October 2003, China's Environmental United Certification 
Centre had undertaken part of the tasks of th e Environmental Labelling Programme. A "China Low 
Carbon Environmental Labelling" logo was issued in 2011 to promote the reduction of GHG emissions. 
2.2.  Under the Environmental Labelling Programme, the criteria and requirements for certification 
followed guidance by the ISO, including ISO/ IEC/GUIDE 65 (General requirements for bodies 
operating product certification systems) an d ISO/IEC/GUIDE/67 (Conformity assessment – 
Fundamentals of product certification). ISO prin ciples and guidance had been amended according 
to China's national circumstances. The drafting pr ocess of relevant technical requirements involved 
relevant stakeholders, including experts, consumers, and enterprises; all comments and 
suggestions were taken into account. The certif ication process comprised the following steps: 
application by the enterprise; examination and conclusion of the relevant certification contracts; document review by the certifying institution; on-site inspection and sampling; type tests; compilation of a comprehensive assessment report by the inspections team; review and evaluation 
by the members of the technical committee; approval  of the report by the head of the certifying 
institution; and issuance of the certificate. There was an annual supervisory inspection. Enterprises had to reapply for certification after their certificates expired. 
2.3.  Ninety-seven categories of products had been certified under the Environmental Labelling 
Programme, including automobiles, electronic products and textiles. Recently, some kinds of services (e.g. printing services) and industrial products (e.g. cement) had also been certified. In 
2014 an environmental benefit assessment conducted on 1,120 certified companies and 
46 categories of labelled products showed significant environmental benefits such as less pollution, energy savings, and improved resource conservation. The number of companies with certified products had increased significantly from 565 in 2007 to 2,841 in 2015. A high level of cooperation 
took place with foreign environmental organizations, including in Australia, Germany, Japan, the 
Republic of Korea, and New Zeal and. For example, an agreement for common criteria on recycled 
toner cartridges had been signed with Germany, and common criteria on computers, DVDs, TV 
sets, and projectors had been published with Japan and the Republic of Korea. 
2.4.  The representative of the European Union stated that environmental sustainability labels 
were important tools to help attain sustainable consumption and production. Labels needed to be 
science-based and non-discriminatory. They could provide new business opportunities for 
companies, given the growing market for green, environmentally friendly and sustainable products. For example, the global market for low carbon and environmental goods and services was estimated at EUR4.2 trillion. The increasing number of companies providing information on 
their environmental performance was encouraging. No netheless, the proliferation of labels, claims, 
certificates and schemes raised some difficulties. Consumers were often confused by the stream of 
incomparable and diverse information on environmental performance and this affected their 
readiness to make green purchases. That was why the European Union had been working on 
improving the availability of clear, reliable and comparable information on the environmental performance of products and organizations. His delegation supported international cooperation 
between labelling schemes, including with China. 
2.2  Chinese Taipei's Green Mark Programme 2.5.  The representative of Chinese Taipei provid ed an overview of their Green Mark Programme. 
The Programme was launched in 1992 as a "Type I" eco-labelling programme. It complied with the 
requirements of ISO 14024 and was considered an important tool to promote green consumption 
and production. It comprised 133 product criteria across 14 product groups. More than 10,000 products and services had been certified. Since 1997 they had concluded 10 bilateral 
mutual recognition agreements with trading partners. Green requirements were incorporated into 
the procurement law in 2002. Several policies were being implemented to increase the supply of WT/CTE/M/59 
 
- 20 - 
 
  green products, facilitate green marketing channels  and expand the scope of the Green Mark from 
goods into services. 
3  OTHER BUSINESS 3.1  Environmental Goods Agreement negotiations  
3.1.  The representative of Australia provided an  update on the negotiations of an Environmental 
Goods Agreement (EGA) in his capacity as the Chair of the EGA negotiations. In January 2014, 
ministers from 14 WTO Members had met in Davos, Switzerland and had agreed to explore ways 
to move forward negotiations to liberalize trade in environmental goods, building on the positive 
developments that had taken place in APEC in  2013. This led to the formal launch of the 
EGA negotiations on 8 July 2014. Seven negotiating rounds took place during the past year (in July, September and December of 2014, and in Ja nuary, March, May and June of 2015). The first 
few negotiating rounds focused on understanding specific environmental challenges and the types 
of products used to meet them. A list of 10 en vironmental product categories provided a helpful 
and logical structure for the negotiations. As part of a process of consultations with experts from 
international organizations, government, academia and industry, EGA participants nominated 
products that they wanted to include in the EGA. Product nominations were compiled into a full list of possible EGA products across all ten product categories. The list consisted of some 
2,400 individual product nominations, covering around 650 tariff lines at the HS six-digit level. In 
the negotiating rounds in May and June of 2015, pa rticipants worked twice through the full product 
list, asking questions about the environmental credibility of specific nominations and technical questions on the tariff classification and proposed ex-outs, which were made to help ensure that 
the nominations were targeted at a particular environmentally beneficial technology. While the 
EGA would be a trade agreement, environmental credibility was at the heart of the negotiations. 
3.2.  Since the previous CTE meeting in October 2014, three additional WTO Members had joined 
the EGA negotiations, bringing the total number of participants to 17. The EGA negotiations would 
continue throughout the rest of 2015 as participants focused on revising the current list of product nominations. The next meeting would be held at th e end of July 2015, with additional meetings in 
September, October and November of that same year. There was no fixed timetable for concluding 
the EGA negotiations but the participants were aware of the WTO Ministerial in Nairobi and the climate change meeting in Paris. EGA participants were interested in making the EGA a living agreement by adding new products and technologies to the EGA list in the future and considering 
related issues such as services and non-tariff barriers. The EGA remained open to any 
WTO Member similarly committed to liberalisation. EGA delegates and negotiators were available to consult with Members interested in joining the negotiations. 
3.3.  The representative of the Bolivarian Republic  of Venezuela stated that the EGA initiative was 
not taking place under the auspices of the WTO. Therefore, any results of the EGA negotiations 
could not be considered as a result of the CTESS negotiations under paragraph 31(iii) of the Doha 
Ministerial Declaration. The EGA mandate should not be equated with the mandate contained in 
paragraph 31(iii), which was much broader and took into account the WTO's universal membership and single undertaking. His delegation was concerned about the proliferation of plurilateral agreements, which undermined multilateral efforts and the WTO. 
3.4.  The representative of Plurinational Stat e of Bolivia echoed the views expressed by the 
Bolivarian Republic of Venezuela, stressing that efforts towards an EGA were not part of the WTO 
agenda. Moreover, plurilateral efforts undermined efforts at the multilateral level, which should 
give priority to the concerns and needs of developing countries. 
3.5.  The representative of India echoed the co ncerns expressed by the Bolivarian Republic of 
Venezuela and Plurinational State of Bolivia and stated that the EGA initiative was taking place 
outside of the WTO. 
3.6.  The representative of Chinese Taipei stated that his delegation was actively participating in 
the EGA negotiations. His delegation was hopeful that these negotiations would contribute 
positively to the environment and the economy. Trade policy could have a positive influence on 
green growth, green employment, sustai nable development and climate change. WT/CTE/M/59 
 
- 21 - 
 
  3.2  Environmental provisions of China's Fre e Trade Agreements (FTAs), in particular 
China-Korea FTA 
3.7.  The representative of China provided an ov erview of the environmental provisions contained 
in China's free-trade agreements (FTAs), with a focus on the China-New Zealand, China-Iceland, 
China-Switzerland and China-Korea FTAs. FTAs were deemed to be a new tool to open up further, 
speed up domestic reforms, integrate into the global economy and strengthen economic cooperation. They were an important supplement to the multilateral trading system. China had 
signed and implemented 14 FTAs. 
3.8.  China's approach to environmental provisions in FTAs had evolved. FTAs concluded during 
the early phase contained relevant wording on environmental protection in the preamble, the exceptions, and the sections on transparency and market access for environmental services. In a 
subsequent phase, FTAs also referred to improvem ents in cooperation in the context of bilateral 
environmental cooperation agreements. Exampl es included the FTAs with Iceland and 
New Zealand. The most recent FTAs containe d an independent chapter on trade-related 
environment issues. Examples included the FTAs wi th Switzerland and with the Republic of Korea. 
In addition, the schedules in these FTAs displayed a high level of openness of China's environmental services sector. 
3.9.  The FTA with New Zealand entered into force in October 2008. In addition to the preamble, 
environmental provisions were contained in Chap ters 8 on technical barriers to trade and 17 on 
general exceptions. Moreover, Chapter 14 referre d to an Environment Cooperation Agreement 
between the Parties. The FTA with Iceland en tered into force in July 2014. Environmental 
provisions could be found in the preamble and in Chapter 9, which referred to a bilateral 
environmental cooperation agreement. 
3.10.  The FTA with Switzerland, which entered into force in July 2014, was the first FTA signed by 
China with a separate chapter on the environment (Chapter 12) with articles on: context and 
objectives, multilateral environmental agreements (MEAs) and environmental principles, dissemination of goods and services favouring the environment, international and bilateral 
cooperation, resources and financial arrangements , and implementation and consultations. This 
chapter established new rules and mechanisms to deepen environmental cooperation and raise the level of environmental protection. It was conducive to cooperation and mutual development in a pragmatic manner. The consensus reached on these issues demonstrated that both Parties had 
sought common ground while taking into account differences in their levels of development.  
3.11.  The China-Korea FTA, which was signed in June 2015 and had not yet entered into force, 
contained environmental provisions in the preamble, and in Chapters 6 (technical barriers to 
trade), 11 (movement of natural persons) and 12  (investment). Chapter 16 on environment and 
trade contained nine articles: context and objectives, scope, levels of protection, MEAs, enforcement of environmental measures including laws and regulations, environmental impact, 
bilateral cooperation, institutional and financial arrangement, and non-application of dispute 
settlement. There were additional environm ental provisions in Chapters 17 (economic 
cooperation), 19 (institutional provisions) and 21 (exceptions). 
3.12.  Under the China-Korea FTA, two developments were particularly important. First, the parties 
committed to "reviewing the impact of the implemen tation of this Agreement on environment, at 
appropriate time after the entry into force of this  Agreement, through their respective participative 
processes and institutions" (Article 16.6). Second, Korean enterprises in the environmental 
services sector could establish individual proprietorship enterprises in China. This provision would 
help strengthen the technological capacity of the respective industries and enhance China's capability and level of environmental protection. There were few substantive differences between 
the environment chapters in the China-Switzerland and China-Korea FTAs. 
3.13.  The representative of Canada stated that his delegation was encouraged to see that China's 
FTAs included trade and environment chapters with substantive provisions recognizing the 
importance of sustainable and responsible utilisation  of fish and forestry resources. His delegation 
had also negotiated environmental provisions in FTAs. This approach was based on the principle 
that trade liberalization and environmental protection should be mutually reinforcing objectives. Core environmental provisions in Canada's FTAs included obligations to pursue high levels of WT/CTE/M/59 
 
- 22 - 
 
  environmental protection and effectively enforce environmental laws. Canada’s FTAs also included 
provisions to ensure that domestic remedies and sanctions for violations of environmental laws were available to citizens, and to promote public participation and transparency. There was a distinct government-to-government dispute settlement mechanism for commitments on the 
environment. This mechanism was based on a collaborative approach and involved review by an 
independent panel of experts. Taken together, th ese provisions helped prevent trading partners 
from gaining an unfair competitive advantage by lowering environmental standards, while 
facilitating cooperation on environment issues of  shared interest and strengthening environmental 
management systems. 
3.14.  The representative of the European Union noted that the environmental provisions in their 
FTAs usually appeared under the heading of Trad e and Sustainable Development. His delegation 
stood ready to share additional in formation in future CTE meetings. 
3.15.  The representative of the Republic of Kore a stated that as of June  2015, the Republic of 
Korea had concluded 15 FTAs with 53 countries. Each FTA had environmental provisions or a 
separate chapter on the environment, reflecting  different views among FTA partners on how to 
address environment issues in FTAs. Environmenta l provisions covered environmental exceptions, 
recognition of each party's right to establish its own level of environment protection, commitments 
on MEAs, environmental cooperation, transparen cy in the development and implementation of 
domestic environmental regulations, specific dispute settlement procedures, and cooperative activities, among others. The Korea-China FTA had a separate chapter on environment issues. The parties faced common environmental challenges due to their geographical proximity and the 
environment chapter urged them to conceive  and implement a common approach. The Korea-
China FTA, along with other instruments such as the bilateral memorandum of understanding, provided a good framework for cooperation on environmental matters. It was important for the 
Parties to implement the FTA with a view to streng thening their capacity to grapple with the twin 
challenges of environmental protection and trade promotion. 
3.3  Briefings by observer organizations 
3.3.1  Briefing by the United Nations Framework Convention on Climate Change 
(UNFCCC)  
3.16.  The representative of the United Nati ons Framework Convention on Climate Change 
(UNFCCC) reported on the status of the climate ch ange negotiations. The last Conference of the 
Parties to the UNFCCC (COP-20), held in Lima in December 2014, adopted the Lima Call for 
Climate Action, which provided formal recognition to the progress made by the Ad Hoc Working Group on the Durban Platform for Enhanced Action (ADP) in developing a new global climate 
change agreement. The Lima Draft of that agr eement set out options for each of the elements 
under negotiation (i.e. mitigation, adaptation, finance, technology development and transfer, capacity-building and transparency of action and support). Parties in Lima requested the ADP to 
develop these elements into a formal negotiating text and to make it available to parties to make a 
final recommendation for a global agreement to be adopted at the COP in Paris in 2015. Parties did not converge on a formal definition of the scope of Intended Nationally Determined Contributions 
(INDCs). However, the Lima Call for Climate Action strongly indicated that parties would put 
forward a mitigation contribution while undertakings related to adaptation may also be 
communicated as part of INDCs. Parties agreed on the information that needed to be provided with the INDCs and requested the UNFCCC Secretar iat to prepare by 1 November 2015 a synthesis 
report on the aggregate effect of the INDCs that had been communicated to it by 1 October 2014 
(as of June 2015, a total of 40 Parties had submi tted INDCs). Parties reached an agreement on the 
principle of "no backsliding" and determined that national mitigation contributions would represent 
a progression beyond current efforts. The principle of common but differentiated responsibilities 
was also captured in the Lima Call for Climate Action. 
3.17.  At the Lima Conference, further progress was made on the Warsaw International Mechanism 
for Loss and Damage associated with Climate Change Impacts as parties agreed on the work plan 
and composition of its Executive Committee. Regarding climate finance, pledges made during the 
Conference allowed the Green Climate Fund to reac h and exceed its initial capitalization goal of 
US$10 billion. Moreover, Parties agreed on specific actions with respect to gender. The Lima 
Conference witnessed the first ever multilate ral assessment process, which reviewed how 
17 developed countries were implementing actions to reduce emissions.  WT/CTE/M/59 
 
- 23 - 
 
  3.18.  The first ADP session after Lima took place in Geneva in February 2015; it was the first 
session for the newly elected Co-Chairs from Algeria and the United States. The objective of the session was to conclude the construction of a negotiating text that fully reflected the views of all Parties (Geneva text). In addition, the ADP continued its work on the technical examination of 
opportunities with high mitigation potential, which had started in 2014 and would continue through 
2020. Finally, the February session provided an in teractive forum in which observers could present 
ideas on how they saw the involvement and role of non-state actors in designing the new global 
agreement. The second ADP session took place in June 2015. It was the first opportunity for the 
parties to negotiate on the basis of the positions captured in the Geneva text. Parties restructured some sections of the text, achieved some streamlining, and brought the text closer to what could be a text suitable for substantive negotiations. Nevertheless, the pace was slow and the Co-Chairs 
were tasked to develop a fully streamlined, conso lidated, clear and concise version of the Geneva 
text that would present clear options without deleting or omitting any distinct option while preserving the positions of Parties. This text would be published on 24 July 2015. Two more 
sessions of the ADP were scheduled for 2015 (August and October). 
3.19.  Under ADP Workstream 2, an informal note would be prepared with the submissions and 
views expressed by the Parties on pre-2020 ambiti on. The examination of technical opportunities 
with high mitigation potential would continue, building on two Technical Expert Meetings on 
renewable energy supply and energy efficiency in urban areas. 
3.20.  The representative of the European Union stated that adopting a legally binding 
international agreement in Paris in 2015 applicable to all parties and raising the global level of 
mitigation ambition in accordance with the requirements of science were critically important 
issues. His delegation was very interested in exploring with others initiatives for raising global mitigation ambition for 2020. 
3.21.  The representative of the Bolivarian Repub lic of Venezuela noted that a just, equitable and 
science-based result of the negotiations would requ ire political will, especially by those that bore 
the historical responsibility recognized by the Framework Convention itself. It was important to 
differentiate on the basis of the principle of co mmon but differentiated responsibilities and to 
recognize that developing countries were making pre-2020 contributions that went beyond those 
of developed countries. INDCs should not become the main focus of the negotiations. A workable agreement should cover the following elements in a balanced manner: mitigation, adaptation, and 
most importantly, the means of implementation, notably financing, technology transfer and 
capacity building. A discussion was pending on the liberalization of patents for technologies to tackle global warming. The basic goal should be the widespread diffusion of such technologies in 
line with domestic potential, as was the case for HIV AIDS drugs and the 2001 Doha Declaration 
on the TRIPS Agreement and Public Health. 
3.3.2  Briefing by the OECD  
3.22.  The representative of the OECD played a short video that relayed the basic messages of a 
recently concluded OECD study entitled "Aligning Policies for a Low Carbon Economy".5 At their 
2014 Ministerial Council Meeting, OECD countries invited the OECD, in cooperation with the IEA, the Nuclear Energy Agency, and the International Transport Forum to examine how to better align 
policies across different areas for a successful economic transition of all countries to sustainable 
low-carbon and climate-resilient economies. As a starting point, the study assumed that stable and predictable climate policies would be put in place, including: a strong price on carbon to ensure 
that low carbon investments are competitive with carbon intensive technologies; strong regulatory 
support in areas such as energy efficiency, in which price signals were not efficient; and some targeted support for the uptake of low carbon te chnologies. These policies were necessary but not 
sufficient to achieve a successful transition to a low carbon economy because economies were 
arranged in such a way that there was a marked preference or bias in favour of fossil fuels as the main source of energy. The study sought to di agnose the misalignments between overall policy 
frameworks and climate goals across policy domains (e.g. investment and finance, taxation, 
innovation, and trade), as well as specific sectors (e.g. electricity, urban mobility and land use). It 
identified a number of opportunities for realigning policies across policy domains and sectors to enable an efficient and cost-effective shift to a low-carbon economy. This would facilitate climate 
action by improving the effectiveness of climate poli cies and lowering the cost of the transition to a 
                                               
5 The video is available at: https://www.youtube.com/watch?v=GQ0AwN41ClI  WT/CTE/M/59 
 
- 24 - 
 
  low carbon economy. There needed to be a coordinated approach across ministries, better 
alignment of policies between countries, and better international cooperation, including a global agreement on GHG emissions. 
3.23.  Regarding long term investment, there was an urgent and unprecedented opportunity to 
ensure that new investment in infrastructure supported the climate agenda while fostering 
economic development. The addition al short-term costs of shifting to low carbon would amount to 
just a fraction of the finance needed for infrastruc ture overall. There was no shortage of capital, 
but new sources of financing needed to be mobilised. Nonetheless, there were several market and 
policy failures that collectively favoured investment in fossil fuel-intensive activities over investment in low-carbon infrastructure, often uni ntentionally. This situation, which stemmed from 
the enabling environment and the functioning and provisioning of financial markets, often made 
the risk-return profile of low-carbon investments less attractive than their fossil fuel-based 
equivalents. Scaling-up financing to a low-carbon economy would not happen spontaneously. It required strong policy and price signals to en sure that low-carbon and energy efficiency 
investments offer a sufficiently attractive risk-adj usted return compared to available alternatives. 
3.24.  Regarding trade, some international trade barriers could undermine climate objectives. For 
example, import tariffs still penalised trade in some goods and services needed for the low-carbon 
transition. Countries that were promoting greener growth by favouring domestic manufacturers of 
low-carbon technologies needed to be mindful th at these measures restricted international trade 
and could undermine overall investment and the uptake of sustainable technologies. 
3.25.  The representative of Plurinational State of  Bolivia stated that actions to address climate 
change should be based on the UNFCCC. Nonethele ss, the OECD study seemed to lack appropriate 
references to the Framework Convention, including its provisions on financing, technology transfer and capacity building. She enquired whether the study would cover such provisions. In addition, 
the study seemed to take for granted the establis hment of a global carbon market. Her delegation 
rejected this, because carbon markets were not effective in tackling the fundamental causes of global warming, and would lead to speculation and shift responsibilities from developed to 
developing countries. Moreover, the inclusion of land use in carbon markets would be a way to 
perpetuate agricultural subsidies provided by developed country Members. The study identified the need to put in place regulatory frameworks to promote a low carbon economy. She enquired about 
the possible effects of such measures on the ma rket access of developing country Members. The 
study indicated that the reduction or elimination of tariffs on environmental goods would facilitate 
the transition to a low carbon economy. Her delegation had doubts about this conclusion, because the elimination of tariffs would result in the loss of fiscal revenue. Moreover, several studies had 
shown that the participation of developing countries in value chains did not guarantee substantial 
profits or technology transfer. 
3.26.  The representative of the European Union stated that the OECD document was a significant 
contribution to the discussion on the transition to a low carbon economy. The document had been 
discussed at the Ministerial level during the OECD Ministerial Meeting in June 2015. Her delegation would welcome additional work on this topic. 
3.27.  The representative of New Zealand stated that her delegation endorsed the messages of the 
OECD report, which resonated with the belief that economic and trade partnership agreements are 
not ends in themselves and that trade, industry , and environmental outcomes could and should be 
mutually supportive. If designed appropriately, trade rules and domestic policies could contribute 
to positive environmental outcomes. 
3.28.  The representative of the OECD explaine d that the draft of the OECD study was not yet 
publicly available. The report sought to answer th e question of how to make basic climate policies 
work better, without calling for a specific arra ngement or outcome under the UNFCCC. The report 
closely scrutinized agricultural subsidies. Regarding tariffs, a large part of the demand for environmental goods was generated by domestic en vironmental policies. In the absence of those 
policies, imports of environmental goods and the corresponding tariff revenue would be low. On 
the other hand, for countries with domestic environmental policies, lowering tariffs on 
environmental goods could result in a decrease  in tariff revenue. Nonetheless, tariffs on 
environmental goods also increased the cost of meeting environmental objectives and inhibited 
improvements in environmental quality. A poor en vironment had a negative impact on the health 
and productivity of the domestic work force. WT/CTE/M/59 
 
- 25 - 
 
  3.4  Briefing by the WTO Secretariat on  developments in other international 
organizations 
3.4.1  Briefing on recent developments regarding the Post-2015 Development Agenda 
process, including United Nations Sustaina ble Development Goals (SDGs) and the Third 
International Conference on Financing for Development in Addis Ababa (FfD)  
3.29.  The representative of the WTO Secretariat provided an update on the current status of the 
process to finalize the Post-2015 Development Agenda and a related process, the Third 
International Conference on Financing for Development. The Post-2015 Development Agenda 
would be adopted at a UN summit scheduled from 25 to 27 September 2015. The intergovernmental negotiations on the Post-2015 Development Agenda were taking place on the basis of a "zero draft outcome document" released by the Co-Chairs of these negotiations in 
June 2015. The zero draft comprised four main parts and a series of annexes. The first part 
consisted of a declaration, which identified poverty eradication as the greatest global challenge and an indispensable requirement for sustainable de velopment. It reflected the intention to end 
poverty and hunger by 2030, combat inequalities, en sure the lasting protection of the planet and 
its resources, and create the conditions for sust ainable, inclusive and sustained economic growth 
and shared prosperity. The declaration referred to  a well-functioning, equitable and rules-based 
multilateral trading system for the realizatio n of the Post-2015 Development Agenda, and the 
importance of providing trade-related capacitybuilding for LDCs, among other issues. 
3.30.  The second part of the zero draft outcome document contained the Sustainable 
Development Goals (SDGs) and related targets. Several targets referred to trade and the WTO. 
Goal 17 contained targets to promote the multilateral trading system, significantly increase 
exports of developing countries, and to realize th e timely implementation of duty-free-quota-free 
market access, including by ensuring that preferential rules of origin applicable to imports from 
LDCs are transparent and simple. There were a number of additional trade-related targets under 
other Goals. The third part of the zero draft ou tcome document established a three-tiered follow-
up and review mechanism for the Post-2015 Deve lopment Agenda, with activities at national, 
regional and international levels, as well as thematic reviews. It also specified the basic principles 
that could underpin follow-up and review. The fourth part of the zero draft outcome document contained the means of implementation and global partnership for sustainable development. This part recognized the need to support international trade as an engine for development. 
3.31.  The Third International Conference on Fi nancing for Development was scheduled from 13 to 
16 July 2015 in Addis Ababa, Ethiopia. The scope of the Conference focused on: (i) assessing the progress made in the implementation of the Monterrey Consensus and the Doha Declaration and 
identifying obstacles and constraints encountered in the achievement of the goals and objectives 
agreed therein, as well as actions and initiatives to overcome these constraints; (ii) addressing new and emerging issues, including in the context of the recent multilateral efforts to promote 
international development cooperation; and (iii) reinvigorating and strengthening the financing for 
development follow-up process. The revised draft outcome document of the Conference issued in 
May 2015 contained a section on trade. A joint meeting of the Financing for Development and the Post-2015 processes was held in New York in April 2015. 
4  DATE OF NEXT MEETING 
4.1.  The next meeting of the Committee would take place sometime around October or 
November 2015. The precise date would be communicated to Members in due course. 
 
_______________ 
 WT/CTE/M/59 
 
- 26 - 
 
  ANNEX 1: ITEMS OF THE CTE WORK PROGRAMME 
 
Item 1: The relationship between the provisions of the multilateral trading system and 
trade measures for environmental purposes, including those pursuant to 
multilateral environmental agreements. 
Item 2: The relationship between environmental policies relevant to trade and 
environmental measures with significant trade effects and the provisions of the 
multilateral trading system. 
Item 3(a): The relationship between the provisions of the multilateral trading system and 
charges and taxes for environmental purposes. 
Item 3(b): The relationship between the provisions of the multilateral trading system and 
requirements for environmental purposes relating to products, including standards 
and technical regulations, packaging, labelling and recycling. 
Item 4: The provisions of the multilateral trad ing system with respect to the transparency 
of trade measures used for environmental purposes and environmental measures 
and requirements which have significant trade effects. 
Item 5: The relationship between the disput e settlement mechanisms in the multilateral 
trading system and those found in mu ltilateral environmental agreements. 
Item 6: The effect of environmental measures on market access, especially in relation to 
developing countries, in particular to the least developed among them, and environmental benefits of removing trade restrictions and distortions. 
Item 7: The issue of exports of domestically prohibited goods. 
Item 8: The relevant provisions of the Agreem ent on Trade-Related Aspects of Intellectual 
Property Rights. 
Item 9: The work programme envisaged in the Decision on Trade in Services and the 
Environment. 
Item 10: Input to the relevant bodies in respect of appropriate arrangements for relations 
with intergovernmental and non-governmental organizations referred to in 
Article V of the WTO. 
  
 
  
 
  
 WT/CTE/M/59 
 
- 27 - 
 
  ANNEX 2: PARTS OF THE DOHA MINISTERIAL DECLARATION THAT RELATE  
TO THE WORK OF THE CTE 
 
32. We instruct the Committee on Trade and Environment, in pursuing work on all items on its 
agenda within its current terms of reference, to give particular attention to: 
 
(i) the effect of environmental measures on market access, especially in relation to 
developing countries, in particular the least-developed among them, and those situations 
in which the elimination or reduction of trade restrictions and distortions would benefit 
trade, the environment and development; 
 
(ii) the relevant provisions of the Agreemen t on Trade-Related Aspects of Intellectual 
Property Rights; and 
 
(iii) labelling requirements for environmental purposes. 
 
Work on these issues should include the identifica tion of any need to clarify relevant WTO rules. 
The Committee shall report to the Fifth Session of the Ministerial Conference, and make recommendations, where appropriate, with respect to future action, including the desirability of 
negotiations. The outcome of this work as well as the negotiations carried out under 
paragraph 31(i) and (ii) shall be compatible with  the open and non-discriminatory nature of the 
multilateral trading system, shall not add to or diminish the rights and obligations of members 
under existing WTO agreements, in particular th e Agreement on the Application of Sanitary and 
Phytosanitary Measures, nor alter the balance of these rights and obligations, and will take into account the needs of developing and least-developed countries. 
 
33. We recognize the importance of technical assist ance and capacity building in the field of trade 
and environment to developing countries, in part icular the least-developed among them. We also 
encourage that expertise and experience be  shared with members wishing to perform 
environmental reviews at the national level. A report shall be prepared on these activities for the 
Fifth Session. 
 
51. The Committee on Trade and Development and the Committee on Trade and Environment 
shall, within their respective mandates, each act as a forum to identify and debate developmental and environmental aspects of the negotiations, in order to help achieve the objective of having 
sustainable development appropriately reflected. 
 
 
__________