Summary and Concluding Remarks

At the onset of this chapter, by listing six quite diverse hypotheses about the WTO's impact on the environment, I tried to sketch how broad the assumed

* For a comprehensive discussion of different proposals in favor or against a World Environment Organization, see Biermann and Bauer (A World Environment Organization: Solution or Threat for Effective International Environmental Governance? 2005).

scope of this impact can possibly be: it ranged from optimistic expectations of a raise in environmental awareness to deeply pessimistic predictions of an accelerated depletion of worldwide ecological assets. The variety of these predictions mirrors the diversity of ecological matters which are in one way or the other affected by the international trade regime, from biological diversity to ozone layer depletion, from global climate change to hazardous wastes. On the other hand, it is this complexity of overlaps of trade and several environmental issues which also renders unfeasible any waterproof examination of the assumptions it has inspired.

Apart from these methodological obstacles, it was also the apparent lack of evidence for some suppositions (e.g., the rather sluggish removal of un-ecological subsidies) which insinuated to single out one particular hypothesis for further examination. The choice was made for the prediction that the WTO will provoke a race to the bottom between domestic and multilateral environmental standards and policies. Still, this concentration on one particular type of environmental impact was far from an over-simplification: given the plethora of intersecting and partially conflicting agreements and rules, the focus on the WTO's role in this institutional mosaic should produce anything but one-dimensional results.

And indeed, when finally asking whether the assumption of a WTO-induced race to the bottom has stood the test, the answer is far from a simple yes or no. In fact, at the time of writing, this question seems more undecided than ever before. Things were different around the time of the WTO's establishment, when two observations clearly seemed to corroborate the watering-down assumption. First, from its very beginning, the environmental policy-making of the organization had been structurally doomed to meet the least common denominator of its member states. Neither the secretariat nor the CTE had been endowed with the competency to exert a proper WTO environmental policy [57]. Instead, the deadlock between industrialized and developing countries on ecological matters had been perpetuated from the Uruguay Round into the CTE, whose decisions tend to be taken consensually among governmental representatives. Second, the organ which was to fill up this environmental policy vacuum, namely the Dispute Settlement Body (DSB), inherited anything but a green legacy from the old GATT Panel which had issued reports clearly unfavorable to domestic environmental standards. Moreover, the DSB cannot set its agenda on its own behalf, but is dependent from WTO parties who have to appeal to it.

Paradoxically, the DSB—while not entitled to set the agenda—has well managed to constantly expand it via groundbreaking decisions; and by the same token, it has expanded its mandate on diverse ecological issues. Yet at the same time, it has also developed greater flexibility in its reports (e.g., when taking into account the life cycle of products, or when recognizing, in certain limits, the backup of national policies by previously agreed MEAs). In this spirit, both the CTE and the DSB acknowledged that conflicts about trade-related rules of an MEA should first be handled by the environmental agreement, supposed that both dispute parties are among its members. In fact, so far no MEA has ever been challenged before the WTO. And finally, the ongoing debate about the inclusion of an environmental window into WTO law nurtures further hopes for an undisturbed coexistence of key green standards and the international trade regime.

So given these pale green spots which have recently been covering the WTO's surface, can we call off the race to the bottom altogether? Such a level of optimism is unjustified. At best, the race might have slowed down in light of these concessions. But it could well regain pace, depending on some upcoming decisions which may serve as signposts for the further environmental course of the WTO. First of all, member states have increasingly questioned the legitimacy of the Appellate Body's recent flexibility towards domestic environmental regulations. The body's next reports on such provisions will show whether this criticism has made it review its practice. And second, the impasse of the debate about the WTO-MEA relationship needs to be broken—the sooner the better. The uncertainty of the status quo is definitely not in the interest of environmental conventions, no matter if or not a "hot" legal dispute about an MEA will take place soon. In the absence of clear priority rules for one regime or the other, the shadow of the WTO's stronger enforcement mechanism makes its members think twice before complying with trade-related measures of an MEA.

Suggestions to solve this dilemma either have focused on legal or institutional reform of the WTO or instead have concentrated on strengthening the judicial status of MEAs. The best approach might well be a reasonable mix of some of these measures, taking the shape of a multi-forum-approach. No doubt, MEAs are the better advocates of environmental concerns. It is hence imperative to make the best out of the current stagnation of the WTO's MEA-related initiatives. This means: using the time at hand and the undecidedness of the matter in order to piece by piece strengthen the position of MEAs vis-a-vis a double expansionism: first, in order to counterbalance the self-inflating jurisdiction and mandate of the DSB, and most of all to do so before the first MEA party vs. non-party dispute will have taken place; and second, in order to keep the CTE from having the final word about which environmental regulations are appropriate and which ones are not.

On the other hand, it is equally important neither to exclude the WTO from the environmental debate in general nor to give up on the CTE in particular. The anti-WTO attitude, as exposed by many protesters from Seattle to Cancun, keeps overlooking the very simple fact that the organization is the only forum which is to some extent capable of controlling trade on a global scale. In other words: no WTO would not mean no free trade, but instead more unregulated free trade—with potentially worse implications for the environment. Therefore, a two-track strategy inside and outside the WTO shows the best potential: enhancing the institutional design of MEAs, while at the same time promoting further WTO-MEA cooperation and attuning WTO law towards the creation of an environmental window. Such efforts across various forums should also be best suited for breaking the ongoing impasse among states parties, by allowing for issue-linkages and hence for a broad acceptance of negotiation results [58,59].* After all, there is enough substance for package deals: across the WTO and a number of MEAs, similar groups of countries are facing each other, but sometimes with reversed roles regarding ecological matters.* Moreover, the overlap of WTO law with international treaties of other issue areas such as labor rights, human rights or international finance [25], should open up further chances for more complex issue-linkages.

To sum up, there are currently several ambiguous tendencies in the relationship between WTO law and both domestic and international environmental regulations. With the outcome of these developments still uncertain and a considerable number of proposals at hand, we are well kept in suspense about the direction which the presumed race to the bottom might finally take. Having affirmed this enduring uncertainty, it is time to bring back to mind that this chapter's focus on legal overlaps presents but one portion of the highly complex mutual impact between free trade and the global environment. With the future findings of new comprehensive research approaches, especially environmental impact assessments, some of this uncertainty should be transformed into a deeper understanding of the trade-environment nexus. However, it remains to be seen if this increasing insight will ever be sufficient to justify statements as plain and as optimistic as the one by Pascal Lamy cited at the beginning of this chapter.

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Negotiating Essentials

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