Environmental Goods Agreement Goes Plurilateral
A
group of 17 WTO members negotiating a tariff-liberalising
Environmental Goods Agreement (EGA) are ramping up efforts to finalise the deal later this year, following another round
of talks last week that reportedly saw good progress. However, many sources also
acknowledge that the pace would need to intensify in order to deliver in the
coming months.
EGA participants continued to focus on the types of
products that should be included in the deal, holding numerous bilateral
meetings during the 19-23 September round in Geneva, Switzerland.
These discussions used a so-called “L-list,” short for
“landing zone list,” reflecting efforts through the G-20 process to identify a
“landing zone” for the agreement this year. Non-G20 EGA participants have also
endorsed the end of year goal.
The list includes some 300 tariff lines and related
“ex-outs” put together by the chair of these talks, Andrew Martin of Australia,
based on extensive consultations. Items on the list relate to a variety of
environmental objectives, including clean energy deployment and energy
efficiency, air pollution control, environmental monitoring and analysis, among
others.
Approximately 15 groups of products remain particularly
challenging, either from a commercial perspective or due to the perception
among some participants of limited environmental credibility.
Some EGA ministers will meet informally at an event,
chaired by the US and the EU, on the sidelines of a “mini-ministerial”
gathering being held in Oslo, Norway, on 21-22 October. That occasion will
immediately follow the next EGA round, which is planned for 16-20 October.
More formally, a meeting of all EGA ministers is
scheduled for 3-4 December, with a negotiating round due to be held directly
before.
Like
the ITA, the EGA is envisaged as an “open plurilateral”
deal within the framework of the WTO, which means that the benefits of tariff
reductions by the participants will apply to all of the global trade body’s
members on a most-favoured nation (MFN) basis.
This feature, however, has raised concerns among some
EGA participants. Sources reported that challenging areas still to resolve
through the text include “critical mass” participation and associated
free-rider concerns.
China, for example, in previous rounds has proposed
several options to manage a situation where the critical mass in world trade in
products covered by EGA participants drops below a significant threshold.
These proposals included the idea of a “snap-black”
clause – where participants could restore tariffs under certain circumstances –
or a WTO waiver to exclude clear free riders from receiving MFN treatment.
During last week’s talks, China suggested that it was
open to proposed solutions from other participants, following earlier pushback
on its own suggestions. Other participants have floated options such as
conducting additional outreach to new potential participants.
The
text will also likely include a work programme covering related environmental
services, along with non-tariff barriers (NTBs) to environmental goods trade.
The move has been backed by the EU, among others, and has also been identified
as part of the deal’s “landing zone.” Discussions remain ongoing, however, as
to what this might involve and the level of detail.