Sin ttulo de diapositiva

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Ministry of Development Industry and Trade MIFIC
The Situation of Environmental Goods in Nicaragua
with Reference to the APEC and OECD Lists
A study conducted within the framework of the
UNCTAD project Building Capacity for Improved
Policy Making and Negotiation on Key Trade and
Environment Issues (INT/0T/AQ).
José Guillermo López López Head of Foreign Trade
Policy (DPCE) MIFIC.
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MIFIC

• Trade and Environment in the Global Context
• Much progress made in the legal field.
  International agreements for the protection and
  preservation of the environment.
  
• Severe imbalances in the production and
  distribution of goods and services.
  
• A high proportion of the worlds population lives
  in extreme poverty.
  
• Rapid technological change on a global scale
  not matched by coordinated environmental
  management which always lags behind social and
  economic development.

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Study on Environmental Goods in Nicaragua

• Conducted within the framework of the WTO
  Ministerial commitments made in Doha Qatar.
  
• The WTO Ministerial mandate to negotiate
• the reduction or as appropriate elimination
  of tariff or non-tariff barriers to environmental
  goods and services.

Doha Ministerial Declaration paragraph 31(ii).
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Development of the Environmental Goods Issue in
Nicaragua

• Has not been developed in a manner specifically
  linked to trade

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Aims of the Study

• To contribute to securing the basic tools for
  building capacity for policy-making and
  negotiation on environmental goods with a view to
  eliminating tariff and non-tariff barriers.
• To identify the need to use these goods in
  conditions that favour the preservation and
  protection of the environment.
  
• To propose a conceptual framework that allows the
  negotiation process to be defined by means of
  clear rules.
  
• To determine what constitutes an environmental
  product an environmentally preferable product
  (EPP) or an organic product.
  
• To evaluate environmental goods in Nicaragua by
  examining trade flows tariff protection levels
  production and production limitations.

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Functions of the Environment
Provides resources needed for production
A place to deposit wastes and residues that
generate production and consumption
A source of services related to enjoyment of the
environment scenic beauty clean air etc.
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Environmental Goods Arising From These Three
Functions
Capital goods
Inputs and raw materials
Equipment
Medicines
Etc.
Natural medicine etc.
Air purifiers water purifiers aspirators etc.
Chlorine chemicals etc.
Cleaner machinery
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WTO Negotiations on Environmental Goods

• Remove non-tariff barriers

Eliminate bound tariffs

• Import licensing
• Quotas
• Quantitative restrictions
• Permits
• Import controls
• Etc.

Reduce import tariff to 0
Result to allow access free of trade barriers
so as to encourage their use in less costly
conditions thereby promoting an environment that
is better protected and preserved.
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A clear definition of environmental goods is
needed for the purpose of trade negotiations

• The standard definition used in some countries
  does not relate to trade
  
• Tangible resources used by human beings as
  production inputs or for final consumption and
  which are used up and transformed in the process.

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The definition normally usedMakes no reference
to any environmental properties.Covers products
of all types.Relates more to friendly
production methods and processes.

• Wood fruit animal hides meat seeds
  medicines etc.

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Definition proposed by Nicaraguas consultant

• Environmental goods are goods which allow raw
  materials inputs capital goods and consumer
  goods in general to be produced and marketed
  under technologically and ecologically rational
  conditions which allow compliance with
  environmental requirements in international
  markets and which aim to preserve and protect
  the environment and human plant and animal
  health. This includes cleaner technologies and
  products which reduce environmental risks and
  minimize pollution and the use of resources.

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Indicative Lists Compiled by APEC and the OECD

• Were drawn up before trade negotiation objectives
  were undertaken in the WTO.
  
• Are based on the interests of highly
  industrialized developing countries (USA EU
  Japan etc.).
  
• Were drawn up taking into account the expansion
  and facilitation of trade rather than
  environmental effects.
  
• A common list accommodating the interests of all
  WTO Members must be drafted within the WTO.
  
• Nicaragua must negotiate the inclusion of a list
  of goods not yet included in the APEC and OECD
  lists e.g. medicines chemicals etc.
  
• Nicaragua liberalization in other countries
  could serve to attract investment in these
  goods.
  

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Trade Based on the APEC and OECD Lists

• There is no tariff classification of any kind
  but Nicaragua does grant unilateral preferential
  treatment to all.
  
• Environmental goods do not feature in WTO
  regional or bilateral integration agreements.

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Trade FiguresTotal APEC and OECD
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Individual Figures for APEC and OECD
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Destination of Exports from Nicaragua Based on
APEC and OECD Lists
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Provenance of Imports to Nicaragua Based on APEC
and OECD Lists
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WTO MFN and Bound Tariff Levels in Effect in 2003
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Environmental Goods OECD and APEC Lists
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WTO Bound Tariffs - 2003

• 168 items. Tariffs 40
• Tariff item 44 but in 2004 40
• No major sensitivities at WTO level as no APEC or
  OECD products were bound at levels higher than
  the overall 40. Of these 70 enjoy 0 MFN.

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Environmental Goods of Export Interest
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Environmental Goods of Export Interest (CONTD)
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Environmentally Preferable Products (EPPs) and
Organic Products
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Conclusions

• The definition of environmental goods must not
  cover agricultural organic or environmentally
  preferable goods.
  
• Environmental goods must lend themselves to
  specific functions for achieving friendly
  production methods and processes.
  
• Importance of tariff and non-tariff
  liberalization of environmental goods within the
  WTO.
  
• Need for clear identification of these goods in
  the Harmonized Commodity Description System at
  international level.
  
• OECD and APEC lists must be treated as
  indicative i.e. as a reference for the purpose
  of establishing a common list.
  
• Nicaragua has a high level of unilateral tariff
  liberalization with regard to APEC and OECD
  environmental goods.
  
• Nicaragua must negotiate and request reciprocal
  access levels in line with its unilateral
  liberalization with a view to promoting
  investment in environmental goods.

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THANK YOU FOR YOUR ATTENTIONglopez_at_mific.gob.
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