WORLD TRADE
ORGANIZATIONWT/CTE/W/198
25 June 2001
(01-3152)
Committee on Trade and Environment Original:  English
UNEP HIGH-LEVEL MEETING ON "DEVELOPING MUTUALLY
SUPPORTIVE TRADE AND ENVIRONMENT POLICIES"
BERLIN, 20–22 MARCH 2001
CHAIRMEN'S SUMMARY
Communication from UNEP
I. BACKGROUND
1. Under the auspices of the United Nations Environment Programme (UNEP) and the German
Federal Ministry for Environment, Nature Conservation and Nuclear Safety (BMU), ministers and
high-level environment and trade officials from over 70 countries, as well as representatives ofintergovernmental organizations including the World Trade Organization (WTO) and four multilateral
environmental agreements (MEAs), and civil society met in Berlin from 20-22 March 2001 to discuss
the linkages between environment, trade and sustainable development.
2. The high level segment of the meeting wa s co-chaired by Dr. Klaus Töpfer, UNEP's
Executive Director, and H.E. Mr. Jurgen Trittin, Minister of the Federal German EnvironmentMinistry.  Ministerial roundtables on coherence between trade and environment policies at the
national and international level were chaired respectively by H.E. Mr. Jan Pronk, Minister of Housing,
Spatial Planning and Environment of the Netherla nds, and H.E. Mr. Dato Law Hieng Ding, Minister
of Science, Technology and Environment of Malaysia .  The high-level segment was preceded by two
days of presentations, discussions and working groups on the use of environmental and integrated
assessments of trade liberalization and other trade-related policies, and the relationship between
MEAs and the WTO.  The following are the main outcomes of the discussions.
3. Since 1950, the global economy has more than quintupled in size, with world exports
increasing over the past 50 years from about US$350 billion in 1950 to US$5.46 trillion in 1999
(WTO, 2000).  In view of today’s rapid expansion of world trade, a greater understanding of the
linkages between trade, environment and development is needed.
4. Trade and trade liberalization policies in general offer opportunities for economic growth.
Trade creates increased incomes, more consum er choice, higher employment, and promotes
investment and technology transfer.  Economic growth can also help countries, particularly
developing countries, to enhance their capacity to address environmental problems.  However, the
benefits accruing from trade and trade liberalization policies have not always been equitably shared
between countries and, in some cases, have in comb ination with other factors increased environmental
degradation and poverty.  Unless the environmenta l and social impacts of trade liberalization and
trade-related policies are taken into account and negative impacts mitigated, the gains from trade may
be offset by environmental degradation, social impacts and loss of public support for trade
liberalization.
5. The demonstrations in Seattle, Washington, Prague and Davos show that many people feel
threatened by trade liberalization.  Consistent with the preamble of the Marrakesh Agreement,
environmental considerations need to be taken into account in the negotiations of trade agreements.WT/CTE/W/198
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Different views about the modalities for achieving this goal were expressed and need to be further
explored.  There is a need for the political will and active commitment on the part of governments to
develop efficient rules, mechanisms and best practices, including further enhancing transparency of
the WTO, that ensure that international trade c ontributes to economic growth and development while
minimizing negative social, cultural and environmental consequences.
II. INTEGRATION OF ENVIRONMENT AND TRADE POLICIES
6. In order to maximize the benefits of trade and trade liberalization and achieve sustainable
development, environmental imperatives should be integrated in trade policies.  It is therefore
essential that environmental policies be taken into account in the development of trade liberalization
policies, first and foremost at the national level, as well as the regional and international level.
Furthermore, trade and development effects on developing countries should be taken into account
when designing environmental policies, as appropriate, and potential synergies and win-win scenarioswhich combine trade, environment and development objectives need to be realised.
7. The Rio principles provide the core for achieving sustainable development.  Sincere attempts
should be made to operationalize the Rio principles, including those related to the polluter pays
principle, common but differentiated responsibility and the precautionary approach while giving due
consideration to the conditions and development priorities of developing countries.
8. In recent years, commodity prices have declined, thus reducing export earnings of resource
dependent developing countries, which has contributed to increased pressures on natural resources to
meet foreign exchange needs.  One of the reasons contributing to this price trend is the subsidization
of sectors like agriculture and fisheries, which evidence suggests have environmental and trade
implications.  Efforts should be made to identify and reduce environmentally adverse andtrade-distortive subsidies, and design policies to reform them.
9. Market access and the ability of all countries to compete in international markets has been one
of the main concerns, particularly of developing countries.  Environmental standards should not be
used as a protectionist measure.  Furthermore, efforts should be made to enhance the capacities of
countries so that they can diversify their exports, and access and compete in international markets onan equitable basis.  Enhancing market opportunities for environmentally friendly products,
particularly those from developing countries, would contribute to sustainable development.
10. The widening technology gap between developed and developing countries needs to be
addressed if developing countries are to be integrated in world trade and achieve sustainable
development.  Increased access to environmentally sound technologies and enhancing the capacities
of developing countries to develop and adapt technologies to meet their own requirements and
development priorities should be included in the capacity building packages provided to developingcountries.  Practical modalities to achieve this need to be put in place.
11. Due to market and policy failures, current market prices do not always reflect the real value of
traded commodities, nor the use of natural and environmental goods and services.  Policies that
internalize environmental costs should be developed and applied in order to capture the real value of
producing and consuming products.  In view of the cost and market access implications ofinternalizing environmental costs, operational modali ties for realizing this objective need to be put in
place.
III. INTEGRATED ASSESSMENT AS A TOOL TO ACHIEVE COHERENCE AT THE
NATIONAL LEVEL
12. A number of tools have been developed to assist policy- and decision makers in formulating
options required to achieve sustainable development.  Integrated assessment is one such tool thatWT/CTE/W/198
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provides a balanced approach for addressing environmental, social and economic considerations
based on countries’ environmental and developmental priorities.  Further efforts need to be devoted to
developing and testing this and other methodologi es at the national level, while exploring the
possibility of extending such assessments at the regional, sub-regional and international levels.
13. Assessments should adopt an integrated appr oach to include environmental, social and
economic aspects.  They should be country led, and the selection of assessment methodologies should
be determined by countries at the national level.  The social dimension of assessments includes issues
related to poverty alleviation, equity considerations and health aspects.  In order to promote a sense of
constructive dialogue and cooperation to address collectively the challenges of sustainable
development, there is a need for a transparent, participatory process involving all stakeholders.
14. There is a need to promote awareness of the linkages between trade, environment and
development.  Environmental and social considerations should be taken into account in trade policyformulation, and consideration should also be given to the trade and developmental implications of
environmental policies and agreements.  Information dissemination of country experiences, best
practices of assessment methodologies, approaches  and policies which promote win-win scenarios
between environment, trade and development should be encouraged.
15. It was acknowledged that the requirement to undertake environmental impact assessments is
included in the legal system of many countries.  However, this requirement mainly applies to projects
and not policies, plans and programmes.  It is desirable to review national laws and policies to reflect
the need to undertake assessments of trade agreements.
16. Assessment should be regarded as a dynamic and continuous process, which promotes policy
coordination and coherence between trade and environment ministries, ministries of finance andeconomy as well as other relevant ministries.  The UNEP country studies on the assessment of the
impacts of trade liberalization on the specific sectors and the UNEP Reference Manual on the
Integrated Assessment of Trade Related Policies are significant contributions to the trade and
environment debate.  Case studies conducted so far by UNEP have produced valuable results, notably
as regards associated impacts of trade liberalization on the environmental and social dimensions, andthe need to adopt appropriate policy measure to address such impacts.  This greatly contributes to
improving the necessary knowledge on trade, en vironment and development linkages and should
consequently be further pursued.  Producing a synthesis report drawing conclusions from this set of
studies should be considered as a useful follow up.
17. Integrated assessments should be used as a tool for policy makers to enhance the net gains of
trade and trade liberalization policies by addressing negative environmental impacts and enhancing
positive ones.
IV. ECONOMIC INSTRUMENTS
18. Economic instruments can provide effective tools for enhancing the benefits of trade
liberalization policies and ensure that trade and environment policies interact in a mutually supportive
way.  The conference of the parties of a number of MEAs have recognized the importance of such
instruments in achieving their objectives.  Efforts should be devoted to using economic instruments aspart of the policy response package developed fo llowing an environmental assessment to achieve
mutually supportive trade and environment policies and to achieve the objectives of MEAs.
19. In order to promote the use and application of economic instruments and advance work in this
area, it is proposed that UNEP establishe s a Working Group under the UNEP/UNCTAD Capacity
Building Task Force on Economic Instruments.  This Working Group will provide technical supporton integrated assessment, assist in the definition of economic instruments, promote awareness and
understanding of the use of economic instruments to achieve sustainable development objectives, ofWT/CTE/W/198
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the identification and design of specific economic instruments appropriate for specific sectors, and
will address the constraints and impediments to introducing economic instruments at the national
level.
V. COHERENCE AT THE INTERNATIONAL LEVEL
20. At the global level, coherence and mutual support between trade and environment regimes
needs to be enhanced, in order to build synergies and avoid potential conflicts with the aim of
achieving sustainable development, while taking into account developing country concerns.
Achieving coherence and coordination at the national level would contribute to enhancing coherence
at the international level.  More efforts are needed to enhance cooperation and exchange of
information between MEAs and between the MEAs and the WTO.
21. Participation of MEAs in relevant WTO bodies would be an important contribution to
transparency and coherence at the international level.  Exploring synergies between technologytransfer provisions of MEAs and the WTO, and comparing compliance and dispute settlement
mechanisms in the different regimes were seen as useful starting points in this regard.  The
relationship between the Convention on Biodivers ity (CBD) and the WTO Trade Related Intellectual
Property Rights (TRIPS) Agreement should also be considered.
22. The process initiated by UNEP to enhance information exchange and dialogue between
MEAs and the WTO Secretariat contributes to increasing the cohesion of global economic and
environmental governance, and the mutual supportiven ess of the trade and environment regimes.  The
World Summit on Sustainable Development scheduled to take place in Johannesburg in
September 2002, will be an important opportunity to enhance cohesion and coordination both among
MEAs, and between MEAs and the WTO, as well as to review progress in internationalenvironmental governance reform.  In preparation for that event, outputs of this Berlin meeting should
also feed into the Open-Ended Intergovernmental Group of Ministers on international environmental
governance that will take place in the margins of CSD-9, notably with respect to the issue of
coherence among MEAs and between MEAs and the WTO.
VI. CAPACITY BUILDING
23. In order to enable developing countries to address the challenges of developing and
implementing mutually supportive environment and trade policies, technical assistance, capacity
building and technology transfer need to be provided.  This support will contribute to building
confidence between developed and developing countries and to help implement sustainable
development as outlined in Agenda 21.
24. Capacity building is essential for undertakin g assessments, implementing flanking policies,
and strengthening the enforcement of national environmental rules and regulations.  More countryprojects similar to the ones conducted by UNEP ar e required, as well as in-country training, and
awareness raising through the convening of national and regional workshops.  Special consideration
for future country studies needs to be given to least developed countries and small island states.
25. WTO regional seminars on trade and environment and the UNEP-UNCTAD Capacity
Building Task Force on trade, environment and development provide valuable capacity-building
services, which need to be expanded in this context.  Capacity-building should have sustainable
development as its overall aim, integrating economic, social and environmental objectives.
VII. FINAL REMARKS
26. Government representatives attending the meeting generally appreciated the role of UNEP in
promoting coherence and understanding on the policy interface between environment, trade andWT/CTE/W/198
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sustainable development.  They requested UNEP to continue its work on enhancing countries’
capacities to undertake assessments of the effects of trade liberalization, and enhancing awareness and
dissemination of best practices and experiences.  Regional and sub-regional seminars and workshops
and enhanced cooperation with the WTO, UNCTAD and civil society would help strengthen these
and other capacity-building activities.
27. Government representatives attending the high-level meeting expressed their appreciation of
the opportunity that the forum provided for frank and open dialogue, and supported the convening of
future meetings including a higher representation of foreign affairs and trade officials.  Participants
thanked UNEP and BMU for co-hosting this meeting.
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