"COMERCIO Y DESARROLLO SOSTENIBLE"

Introduction to the Session

Welcome and Overview

• The session begins with a warm welcome from Professor Salvador Puellez, addressing students and colleagues from various locations including Lima, Arequipa, and Chiclayo.

• Acknowledgment of participants joining via Zoom and YouTube, emphasizing the global reach of the event.

• Introduction to the 18th exchange of business experiences, designed as a reflective space for critical analysis of best practices in business management.

Purpose of the Event

• The event aims to complement academic learning by providing firsthand insights into effective business practices and perspectives from key industry players.

• Today's topic is "Trade and Sustainable Development," presented by MBA Mateo Ferrero, highlighting its relevance in current times.

Key Themes in Trade

Importance of International Trade

• Discussion on how international trade contributes to economic growth and development.

• Raises critical questions about ensuring that trade leads to sustainable development for countries globally.

Role of Multilateral Organizations

• Mention of organizations like the World Trade Organization (WTO), which often mediates differences regarding trade policies.

Speaker Introduction: Mateo Ferrero

Background Information

• Mateo Ferrero's credentials include a law degree from Universidad de los Andes and a master's in international economic law from the University of Barcelona.

• His experience includes working at WTO's Appellate Body Secretariat and currently serving as an advisor on trade and environment issues at WTO.

Engagement Guidelines

Interactive Participation

• Students are encouraged to remain active during the session as they will need to prepare summaries based on the videoconference content.

Q&A Format

• Questions will be collected through chat or raised hands, with responses provided by Mateo Ferrero at the end of his presentation.

Presentation Focus: Trends in Trade Policy

Overview of WTO Functions

• Mateo Ferrero introduces his presentation focusing on recent regulatory trends observed at WTO concerning trade policy and environmental protection.

Key Questions Addressed

• He plans to explore whether WTO commitments hinder member countries' ability to protect their environments—a common debate in media and academia.

Introduction to the World Trade Organization (WTO)

Overview of WTO's Roles

• The WTO serves three key roles: as a mechanism for transparency, a forum for discussion and information exchange, and a center for knowledge.

What is the WTO?

• Founded in 1995, the WTO is an international organization with 166 members that establishes rules governing trade between countries.

Leadership and Structure

• The current Director-General is Dr. Ngozi Okonjo-Iweala from Nigeria, who has been in office for four years and was re-elected for another term. The organization operates on an annual budget of approximately 200 million francs with a staff of around 623 people.

Membership Insights

• Peru has been a founding member of the WTO since January 1, 1995. Currently, about 98% of global trade operates under WTO rules, highlighting its significance in international commerce. Members are represented on a map where green indicates current members and yellow shows those in the process of joining.

Location and Operations

• The sole headquarters of the WTO is located in Geneva, Switzerland, contrasting with other multilateral organizations that have regional offices. Major decisions occur during biennial ministerial conferences held globally; the last was in the UAE (2022), while the next will be in Cameroon (2026). Additionally, technical assistance is provided to developing member countries through secretariat officials traveling to offer support when requested.

Core Functions of the WTO

Establishing International Norms

• At its core, the WTO establishes binding international norms through over 25 treaties that govern how members should conduct international trade activities. These agreements are essential for maintaining order within global commerce.

Negotiation Forum

• The organization acts as a platform for negotiating new international rules to address emerging issues effectively; recent agreements include one on trade facilitation adopted in 2013 and another regulating fishing subsidies aimed at reducing environmental impacts.

Dispute Resolution Mechanism

Introduction to the Organization and Its Pillars

Overview of Organizational Structure

• The organization faces challenges with appointing new judges in the second instance, yet it remains a crucial part of its structure, valued by most members as a unique characteristic.

Key Pillars of the Organization

• The third pillar emphasized is the application of existing rules, which are based on over 25 international treaties established in the mid-90s that created the organization.

• These rules must be implemented by all members, facilitated through numerous committees that regularly meet to monitor compliance and address trade tensions.

Decision-Making Process

• Decisions within the organization are made by consensus; any new treaty or committee decision requires agreement from all members.

• While this consensus approach lends legitimacy to decisions, it complicates agreement among 166 diverse member countries compared to earlier times when fewer nations were involved.

Purpose and Misconceptions about the WTO

Why Does the WTO Exist?

• The common belief is that the WTO promotes free trade; however, its true aim is to facilitate regulated trade within a robust legal framework.

• Thus, rather than equating WTO with free trade, it should be viewed as an entity supporting regulated commerce.

Environmental Protection vs. Trade Commitments

Addressing Environmental Concerns

• A provocative question raised: Do WTO commitments hinder member states from protecting the environment? This belief is prevalent in media and academia.

Existence of Agreements

• There is no specific agreement on trade and environment within WTO's framework; agreements exist for agriculture, sanitary measures, technical barriers to trade, subsidies, etc.

Intersection of Trade and Environment

• Despite lacking a dedicated agreement on trade and environment, many existing agreements relate directly to environmental protection issues.

Hierarchical Importance of Sustainability

Commercial Relations and Environmental Goals

Historical Context of Trade Agreements

• The GATT of 1947 emphasizes the importance of commercial and economic relations aimed at achieving higher living standards, full employment, increased real income, and optimal use of global resources.

• In contrast, the Marrakesh Agreement (1994), which established the WTO, also recognizes these economic goals but adds a central objective: sustainable development and environmental protection.

• The preamble of the Marrakesh Agreement highlights the need for optimal resource utilization in line with sustainable development goals, marking a significant shift from earlier trade agreements.

• This evolution reflects a broader understanding that international trade rules must now incorporate environmental considerations alongside traditional economic objectives.

Examples of Trade Policies for Environmental Objectives

Environmental Requirements

• Members often adopt environmental requirements such as labeling related to carbon footprints on products, increasingly common in supermarkets.

Market Tools and Taxes

• Carbon taxes or pricing mechanisms are becoming more prevalent as tools to address greenhouse gas emissions while impacting trade policies significantly.

Subsidies for Green Technologies

• Many countries provide subsidies to promote green technologies like solar panels, encouraging both industries and households to adopt renewable energy solutions.

Additional Trade Policies Supporting Environmental Goals

Import Restrictions

• Quantitative restrictions may be imposed by members on imports deemed harmful to the environment, such as toxic waste bans.

Tariffs for Environmental Protection

• Customs duties can be adjusted; reducing tariffs on eco-friendly goods makes them more accessible while increasing tariffs on environmentally harmful products discourages their importation.

Public Procurement Practices

• Public procurement represents a significant portion of GDP in many WTO member countries. It serves as an effective tool for promoting green consumption and production practices.

Conclusion on Trade Measures and Environmental Protection

Trade Regulations and Environmental Protection

National Treatment and Trade Restrictions

• The concept of national treatment is discussed, emphasizing the importance of fair competition between imported and domestic products.

• Key disciplines such as non-discrimination, quantitative restrictions, and avoiding unnecessary trade barriers are highlighted as essential regulations in international trade.

Balancing Trade Rules with Environmental Goals

• The World Trade Organization (WTO) provides regulatory space for member countries to pursue environmental objectives through trade measures.

• There exists a delicate balance within WTO rules that allows for public policy goals, including environmental protection, while adhering to established obligations.

Conclusion on WTO Commitments and Environmental Protection

• It is crucial to recognize the interplay between regulatory space for environmental initiatives and adherence to disciplines like non-discrimination and avoidance of unnecessary barriers.