Trade and Environment

The relationship between trade and environment has been a topic of discussion for many years. The focus has been the implications of environmental policies on international trade. The GATT Secretariat first expressed this concern in 1971, through the document called Industrial Pollution Control and International Trade. At that time, there was fear for environmental policies to become a form of protectionism. In 1992, the importance of trade for sustainable development emerged. Environment and multilateral trade systems were linked in 1994 through the Marrakesh Agreement, placing environment within the objectives of the WTO (established 1995).

The objective of a trading system is the liberalisation of markets through regional (FTAA) or global (WTO) agreements. It is also argued that trade has a potential to be a source for financing development through trade-related income generation and foreign direct investment. This would translate into economic growth and a source...