The World Trade Organization: Background

A WTO-produced primer describes the organization's history, structure and basic principles, as well as a general description of the results of the Uruguay Round negotiations.

One of the bodies of law on trade in goods that the WTO administers is the General Agreement on Trade and Tarriffs (GATT). The WTO also administers and embodies the rest of the results of the Uruguay Round of negotiations, including the General Agreement on Trade in Services, the Agreement on Intellectual Property Rights, and the Understanding on Rules and Procedures Governing the Settlement of Disputes. The WTO, as well as being a body of law, is an international institution based in Geneva. It replaces the GATT which was in fact merely a provisional agreement and not a legal institution. 

What does the WTO have to do with sustainable development? Briefly, any law or regulation passed by a WTO member that affects trade flows -- even if its purpose is primarily environmental protection -- has to measure up to GATT rules. To take a famous case, parts of a U.S. law aimed at protecting marine mammals, which banned imports of "dolphin-unsafe" tuna were found to violate GATT rules, since they were unilateral, extrajurisdictional and based on PPMs. 

So there may be a clash between environmental law, both national and international, and the rules of international trade.

Another way the WTO affects sustainable development is its economic effects on developing countries; remember that sustainable development has poverty alleviation as a prime concern. Proponents of free trade argue that trade liberalization benefits poor countries, and most would agree that a rules-based system is better for weaker countries than a might-is-right free-for all. But there are still some concerns. The results of the most recent round of negotiations -- the Uruguay Round -- may mean worsening conditions for poorer food-importing countries, as agricultural subsidies are reduced. Others are worried that the Agreement on Trade-Related Investment Measures (TRIMS) may weaken developing countries' ability to squeeze more economic benefit for their countries out of foreign investment. Still others worry that the Agreement on Trade-Related Intellectual Property Rights (TRIPS) may force developing countries to shell out significant fees and royalties to Northern patent-holders, and have negative effects on developing country innovation and biodiversity.

With the establishment of the WTO came the establishment of its Committee on Trade and Environment. The Committe regularly releases bulletins describing its deliberations.

The Secretariat regularly prepares background papers for the Committee's consideration, a number of which are de-restricted and available at the WTO's trade and environment web site. The Secretariat for the pre-WTO "Working Group on Environmental Measures and International Trade" prepared eight issue papers (1991-1994), which are still relevant as background to the major issues.