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USTR Consults On WTO Environmental Goods Agreement

by Mike Godfrey, Tax-News.com, Washington

10 June 2014


The Office of the United States Trade Representative (USTR) held a public hearing on June 5, World Environment Day, to gather comments and input on American negotiating objectives for the proposed World Trade Organization (WTO) Environmental Goods Agreement (EGA).

In January this year, a group of WTO members – Australia, Canada, China, Costa Rica, Taiwan, the European Union, Hong Kong, Japan, South Korea, New Zealand, Norway, Switzerland, Singapore and the US – pledged to launch negotiations on liberalizing trade in so-called "green goods," of which those countries account for 86 percent of global trade.

The EGA's aim is not only to eliminate tariffs on a range of items, but also to create a "living agreement" that will evolve according to future needs, and thereby address other barriers to trade. Some countries apply tariffs as high as 35 percent, adding unnecessary costs to environmental technologies.

The initiative will build on the commitment made by Asia-Pacific Economic Cooperation (APEC) countries to reduce import tariffs on environmental goods to 5 percent or less by 2015. The APEC list extends to 54 goods, but could expand, as more products that promote energy efficiency, such as solar panels, are identified. The WTO list includes solar water heaters, wind turbines and catalytic converters.

The current group of countries has also begun to reach out to other jurisdictions, in the hope that more will join the scheme. Any agreement reached will be anchored with the WTO, and based on its Most Favored Nation principle.

During the hearing, the USTR pointed out that, by eliminating tariffs on environmental goods, the EGA could "make them cheaper and more accessible for everyone, while leveling the playing field for US exporters," while witness testimonies recommended a wide range of products for inclusion in the EGA. In 2013, the US was confirmed to have exported USD106bn of such goods.

TAGS: environment | tax | tariffs | trade treaty | Australia | China | Norway | Singapore | Taiwan | agreements | Canada | Costa Rica | Hong Kong | Korea, South | New Zealand | Switzerland | United States | import duty | trade | European Union (EU) | Japan | Europe | Asia-Pacific

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