Why Developing Countries Won't Negotiate: The Case of the WTO Environmental Goods Agreement
Trade, Law, and Development, vol. 6, no. 1, pp. 93-176
84 Pages Posted: 24 May 2015
Date Written: 2014
This Article examines the question of why very few developing countries have chosen to participate in the WTO negotiations for a plurilateral Environmental Goods Agreement. The conventional belief is that developing countries have export interests at stake in environmental goods, but are avoiding the talks because of competing desires to preserve high tariff rates to protect domestic industries and/or to express their dissatisfaction with the current mode of negotiations. This Article proposes an alternative interest-based explanation: Most developing countries stand to gain very little from the talks, as they are currently structured. More important than the countervailing forces emphasized by the conventional explanation is the simple fact that developing countries, other than China, simply do not have sufficient interests at stake to join the negotiations.
Drawing on original analyses of recent trade flows in environmental goods from various developing countries, the Article highlights the following: First, very few developing countries have much at stake in terms of exports. Second, among those that do export, many already have reaped significant tariff benefits through negotiations in other fora. Third, developing countries can achieve remaining objectives through free riding. Finally, the predominance of intra-developing country trade minimizes gains from a treaty dominated by advanced economies. Together, these explanations account for why most developing countries have little to gain – contrary to the conventional belief that many have interests at stake.
For those who may find the lack of developing country participation to be troubling, this Article explores several potential options to entice more developing countries to join the negotiations. Overall, the Article suggests that the key to increasing the participation of developing countries will be to expand the scope of the negotiations beyond what is currently on offer, to include other environmental goods, services, and/or non-tariff barriers.
Keywords: Trade, Environment, WTO negotiations
JEL Classification: F13, F14, F18
Suggested Citation: Suggested Citation