www.greennet.org.uk/fern

The WTO and forests

Forests are disappearing fast. In the tropics, 40 soccer-fields of tropical rainforest disappear every minute. In the boreal area, ecologically valuable old-growth forests are being replaced by plantations. The direct causes include logging, agricultural expansion, pollution, road building, mining and hydropower. Perhaps even more important are the underlying causes which include inequitable land tenure patterns, the lack of recognition of local communities’ legal rights, social exclusion, ever increasing trade linked to over-consumption and a flawed international trade system. Logging is now seen as the most important direct cause of loss of primary forests. Despite attempts at several levels to stop the forest crisis, the overall situation is not improving.

The upcoming WTO meeting in Seattle, and the trade negotiations that will follow it, could aggravate this situation. Trade in itself is neither good nor bad for forests. Trade liberalisation can even be beneficial for forest conservation and sustainable management if conservation policies are well developed and implemented, legal rights of local communities are respected and there is equal access to land. However, further liberalisation of forest products and other sectors, combined with the current poor state of our forests and inadequate forest conservation policy, will result in unsustainable logging and further degradation of forest subsoil. It will also lead to the substitution of forests by other productive activities such as agriculture and large-scale tree plantations, and result in more social unrest.

The agenda for further WTO negotiations has not yet been set but forests could be affected if the following issues are put on the negotiating table:

·         Further tariff reduction on forest products. This could take place either through the EU’s proposed negotiations on reducing non-agricultural product tariffs or through the USA’s proposed ‘Accelerated Tariff Liberalisation’ (ATL) in the forest sector. Reduction of import tariffs will lead to increased timber and paper consumption, exacerbating the problems associated with already high consumption levels. Such proposals are likely to have a significant impact in specific regions. A US Government sponsored impact study on forests of the ATL proposal predicts an increase in timber harvest in Indonesia and Malaysia by 2 to 4.4%,  and Sweden and Finland by 7 to 11%. Although this study is flawed, it is at least an indication that logging will increase as a result of tariff reductions.

·         Non Tariff Measures to protect forests. Also potentially on the table are talks on reducing ‘Non-Tariff Measures’ (NTMs). These negotiations could be used to get rid of some NTMs currently in place to protect forests and forest peoples. Activities which could be branded NTMs and subject to reduction/prohibition are eco-labelling and forest-certification, import/export quota's, log export bans, requirements for recycling and waste recovery and subsidies. Most of these measures have been put in place to conserve forests or protect forest-dependent communities and such policy choices should not be restricted through the WTO.

·         Liberalisation of the agriculture sector. There will definitely be negotiations on agriculture as it is part of the so-called ‘built-in agenda’. Although some agricultural liberalisation could be environmentally and socially beneficial (i.e. reducing production-related subsidies), other measures are expected to have a major impact on forests. For example, tariff reductions in sectors like palm-oil could increase pressure to convert forests for oil-palm plantations. This highlights the need for a much better understanding of the impacts of agricultural liberalisation on forests.

·         Investment. There is already a limited WTO agreement on investment measures and the EU is pressing for the negotiation of further investment rules. If a wide-ranging agreement is reached on investment, it could further restrict the ability of Governments to place conditions and restrictions on inward investment in the forest sector. For example, requiring inward investors to undertake a joint venture with a local forest firm (in order to improve accountability and facilitate technology and skills transfer) could be prohibited.

·         Government procurement. The EU is also pressing for government procurement rules to be on the negotiating agenda. Governments and local councils can currently use their purchasing power to help alleviate forest problems. This includes specifying the use of sustainably produced timber and buying recycled paper. Such actions could be deemed discriminatory and thus become illegal if government procurement disciplines are introduced into the WTO.

The WTO and its members have ignored the potential adverse effects of trade liberalization on forest ecosystems and forest communities. They have failed to assess the environmental and social impacts of timber trade liberalization and liberalization in other sectors that affect forests and forest peoples. The WTO and its members have also failed to adequately involve civil society in timber trade and other liberalization discussions.

Many of the issues that could be put on the negotiating table at the upcoming Seattle Ministerial Conference reflect an economic agenda that prioritizes trade liberalization as an end in itself rather than as a means that, in some circumstances, may be useful for improving our quality of life. This agenda does not take into consideration the concerns of the people and communities who are ultimately affected or the potential impacts on the environment.

We therefore demand that the European Commission and the Member States do not negotiate the above-mentioned proposals unless a proper sustainability impact assessment (looking at both the impacts of past liberalisation and the proposed agenda) has been conducted and measures are taken to reverse possible negative impacts on forests of increased trade.