Technical barriers to trade
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The trade effects of non-tariff measures and services measures
This section discusses the trade effects of non-tariff measures and services measures in general before focusing on technical barriers to trade (TBT) sanitary and phytosanitary (SPS) measures and domestic regulation in services. It also examines whether regulatory harmonization and/or mutual recognition help to reduce the trade-hindering effects caused by the diversity of TBT/SPS measures and domestic regulation in services.
World trade in 2011: Introduction
The volume of world merchandise trade rose 5.0 per cent in 2011 accompanied by global output growth of 2.4 per cent. This marked a significant slowdown from 2010 when trade advanced 13.8 per cent and output expanded by 3.8 per cent.
Introduction
Non-tariff measures that can potentially affect trade in goods present the multilateral trading system with a basic policy challenge – how to ensure that these measures meet legitimate policy goals without unduly restricting or distorting trade. The same challenge applies to measures that can affect trade in services. This introduction discusses how the motivations for using non-tariff measures and services measures have evolved complicating the policy panorama but not changing the core challenge of how to manage the tension between public policy goals and trading opportunities.
An inventory of non-tariff measures and services measures
This section reviews available sources of information on non-tariff measures (NTMs) and services measures evaluating their relative strengths and weaknesses. It uses available information to establish a number of “stylized facts” regarding the incidence of NTMs and services measures in general. It looks in particular at technical barriers to trade sanitary and phytosanitary measures and domestic regulation in services.
An economic perspective on the use of non-tariff measures
Governments use non-tariff measures and services measures for a growing number of reasons. This section examines what these are and how they may affect trade. It also analyses the choices available to governments among a variety of policy instruments from a theoretical and an empirical perspective. The section ends with case studies on non-tariff measures in the context of the recent financial crisis climate change and food safety.
Acknowledgements
The World Trade Report 2012 was prepared under the general direction of the WTO’s Deputy Director-General Alejandro Jara and supervised by Patrick Low Director of the Economic Research and Statistics Division. The writing of this year’s report was coordinated by Marc Bacchetta and Cosimo Beverelli. Work on individual sections was coordinated by Alexander Keck Coleman Nee Roberta Piermartini and Michele Ruta.
International cooperation on non-tariff measures in a globalized world
The focus of this section is international cooperation on non-tariff measures (NTMs) and services measures. The section first reviews the economic rationale for such cooperation in the context of trade agreements. It then looks at the practice of cooperation in the areas of technical barriers to trade (TBT) sanitary and phytosanitary (SPS) measures and domestic regulation in services. The third part deals with the legal analysis of the treatment of NTMs in the GATT/WTO system and the interpretation of the rules that has emerged in recent international trade disputes. The section concludes with a discussion of the challenges of adapting the WTO to a world where NTMs are a growing concern.
State of the world economy and trade in 2011
The rate of world output growth fell to 2.4 per cent in 2011 from 3.8 per cent in the previous year weighed down by the on-going sovereign debt crisis in Europe supply chain disruptions from natural disasters in Japan and Thailand and turmoil in Arab countries. This pace of expansion was well below the 3.2 per cent average over the 20 years leading up to the financial crisis in 2008.
Executive summary
This year’s World Trade Report ventures beyond tariffs to examine other policy measures that can affect trade. As tariffs have fallen in the years since the birth of the General Agreement on Tariffs and Trade (GATT) in 1948 attention has progressively shifted towards non-tariff measures (NTMs). The range of NTMs is vast complex driven by multiple policy motives and ever-changing. Public policy objectives underlying NTMs have evolved. The drivers of change are many including greater interdependency in a globalizing world increased social awareness and growing concerns regarding health safety and environmental quality. Many of these factors call for a deepening of integration wresting attention away from more traditional and shallower forms of cooperation. Trade in services is a part of this development and has come under greater scrutiny along with the policies that influence services trade.
World Trade Report 2012
Regulatory measures for trade in goods and services raise new and pressing challenges for international cooperation in the 21st century. The World Trade Report 2012 examines why governments use these non-tariff measures and to what extent such measures may distort international trade. Non-tariff measures (NTMs) can serve legitimate public policy goals such as protecting the health of consumers but they may also be used for protectionist purposes. The Report reveals how the expansion of global production chains climate change and the growing importance of consumer concerns in richer countries affect the use of NTMs. It also reports that such measures represent the main source of concerns for exporters. The focus of the Report is on technical barriers to trade (TBT) regarding standards for manufactured goods sanitary and phytosanitary (SPS) measures concerning food safety and animal/plant health and domestic regulation in services. The Report looks at the availability of information on NTMs and the latest trends concerning usage. It discusses the impact that NTMs have on trade and examines how regulatory harmonization and/or mutual recognition of standards may help to reduce any trade-hindering effects. Finally the Report looks at international cooperation on NTMs.
United States - Measures Concerning the Importation, Marketing and Sale of Tuna and Tuna Products
On 24 October 2008 Mexico requested consultations with the United States with respect to the following measures: (i) the United States Code Title 16 Section 1385 (“Dolphin Protection Consumer Information Act”) (ii) the Code of Federal Regulations Title 50 Section 216.91 (“Dolphin–safe labeling standards”) and Section 216.92 (“Dolphin–safe requirements for tuna harvested in the ETP [Eastern Tropical Pacific Ocean] by large purse seine vessels”) and (iii) the ruling in Earth Island Institute v. Hogarth 494 F.3d 757 (9th Cir. 2007).
United States - Measures Concerning The Importation, Marketing and Sale of Tuna and Tuna Products
On 15 September 2011 the WTO issued the dispute panel reports in the case "United States - Measures concerning the importation marketing and sale of tuna and tuna products".
European Communities - Trade Description of Sardines
On 20 March 2001 Peru requested consultations with the EC concerning Regulation (EEC) 2136/89 which according to Peru prevents Peruvian exporters to continue to use the trade description “sardines” for their products. Peru submitted that according to the relevant Codex Alimentarius standards (STAN 94-181 rev. 1995) the species “sardinops sagax sagax” are listed among those species which can be traded as “sardines”. Peru therefore considered that the above Regulation constitutes an unjustifiable barrier to trade and hence in breach of Articles 2 and 12 of the TBT Agreement and Article XI:1 of GATT 1994. In addition Peru argues that the Regulation is inconsistent with the principle of non-discrimination and hence in breach of Articles I and III of GATT 1994.
European Communities - Trade Description of Sardines
On 20 March 2001 Peru requested consultations with the EC concerning Regulation (EEC) 2136/89 which according to Peru prevents Peruvian exporters to continue to use the trade description “sardines” for their products. Peru submitted that according to the relevant Codex Alimentarius standards (STAN 94-181 rev. 1995) the species “sardinops sagax sagax” are listed among those species which can be traded as “sardines”. Peru therefore considered that the above Regulation constitutes an unjustifiable barrier to trade and hence in breach of Articles 2 and 12 of the TBT Agreement and Article XI:1 of GATT 1994. In addition Peru argues that the Regulation is inconsistent with the principle of non-discrimination and hence in breach of Articles I and III of GATT 1994.
European Communities - Measures Affecting Butter Products
On 3 May 1995 the US requested consultations with Korea in respect of requirements imposed by Korea on imports from the US which had the effect of restricting imports. The US alleged violations of Articles III and XI of GATT Articles 2 and 5 of the SPS Agreement Article 2 of the TBT Agreement and Article 4 of the Agreement on Agriculture.
European Communities - Measures Concerning Meat and Meat Products (Hormones) - Original Complaint by Canada
On 12 July 1999 the WTO issued the dispute panel reports in the case "European Communities - Measures concerning meat and meat products (hormones) - Original complaint by Canada".
European Communities - Measures Concerning Meat and Meat Products (Hormones) - Original Complaint by the United States
On 12 July 1999 the WTO issued the dispute panel reports in the case "European Communities - Measures concerning meat and meat products (hormones) - Original complaint by the United States".
Argentina - Measures Affecting Imports of Footwear, Textiles, Apparel and Other Items
On 4 October 1996 the US requested consultations with Argentina concerning the imposition of specific duties on these items in excess of the bound rate and other measures by Argentina. The US contended that these measures violate Articles II VII VIII and X of GATT 1994 Article 2 of the TBT Agreement Article 1 to 8 of the Agreement on the Implementation of Article VII of GATT 1994 and Article 7 of the Agreement on Textiles and Clothing.
European Communities - Measures Concerning Meat and Meat Products (Hormones)
On 28 June 1996 Canada requested consultations with the European Communities regarding the importation of livestock and meat from livestock that have been treated with certain substances having a hormonal action under Article XXII of the GATT 1994 and the corresponding provisions in the SPS Agreement TBT Agreement and the Agreement on Agriculture. Canada alleges violation of Articles 2 3 and 5 of the SPS Agreement; Article III or XI of the GATT 1994; Article 2 of the TBT Agreement; and Article 4 of the Agreement on Agriculture.