Trade, Sustainability and the Food and Natural Resource System: Some Examples of Governance Issues

Trade in agricultural goods and raw materials provides an important challenge for rule-making at the national, regional and international level. Many of the activities undertaken in the name of efficient agriculture are unsustainable, but unsustainable agriculture does not depend just from the exports level, because it can be found everywhere: in fact, trade in agricultural and food products can both threaten and promote sustainability. At that point the question arises as to what multilateral (or regional) rules are needed specifically to tackle the issue of sustainability and trade? With regards to this question, there are several issues such as property rights to indigenous resources, trade rules governing biofuels, investment in and ownership of land and mineral rights in resource-rich countries. This short paper looks at some specific areas where the issue of global governance, through trade institutions, impinges on farming and fishing practices and related types of raw material trade, by presenting a taxonomy that shows the intersection between government trade activities, trade agreements and sustainability. Particularly, it may consider two categories of government activity in agricultural and raw material trade: taxes or other restrictions and subsidies or other forms of encouragement; these actions can be divided in the direction of sustainability and those that are inimical to that objective. Therefore, the paper will illustrate the interface between trade rules and sustainability objectives, by discussing some examples reflecting these actions/sustainability combinations, such as: the removal of tariffs on environmental goods; restrictions on imports of products produced in an unsustainable way; restrictions on exports of raw materials in the context of scarcity; subsidies to encourage environmental farming practices; subsidies for the production and use of biofuels; and subsidies for fossil fuel usage. The last section links these topics to the issue of gaps in global governance: this item has been recognized in WTO discourse for some time, especially in the Ministerial Declaration on the contribution of the WTO to achieving greater coherence in global economic policymaking. But the search for a cohesive system of governance remains in the hands of the major countries of the world that have to led the way towards the synergy between trade rules and sustainability goals. s.