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Division for Sustainable Development.
EXECUTIVE SUMMARY
Unlocking Trade Opportunies shows how developing country
producers can benefit from rising environmental expectations in their
export markets, particularly in the industrialised world. The report was
commissioned by the United Nations Department for Policy Coordination
and Sustainable Development as part of its implementation of the Agenda
21 action plan agreed at the 1992 Earth Summit. In Agenda 21, the
governments of the world agreed that action had to be taken both to
promote more sustainable patterns of consumption and production, and to
make global goals for the environment, development and trade mutually
reinforcing.
The Challenge
Much has happened since 1992 to take forward the goal of
sustainable consumption and production (Part 1 - Introduction).
Governments in the industrialised world have tightened product
regulations and introduced new producer responsibilities for waste.
Economic instruments are being used more, along with product information
(such as eco-labelling). Public procurement policies are starting to
incorporate environmental criteria and trade policies are being adjusted
to support exports of sustainably produced goods from developing
countries. In the business world, a small number of committed
corporations are developing more eco-efficient production methods, and
new ways of meeting customer requirements. Among consumers in
industrialised countries, there is continued unease about the
environmental impacts of their lifestyles, and a sense of frustration
with the limited possibilities for change. Although the long-term
implications of this is uncertain, for developing country producers that
can adapt to these requirements and start moving to anticipate trends,
new trade opportunities are now emerging.
The Response
The report presents 10 case studies where developing country
enterprises and economies across the manufacturing, tourism, forest and
agricultural sectors have turned tightening environmental regulations,
new corporate practices and changes in consumer values to their
advantage (Part 2 - The Case Studies).
The Case Studies
The Lessons
Unlocking Trade Opportunities demonstrates what can be
done in spite of often unfavourable conditions (Part 3 - Lessons and
Ways Forward). None of the case studies are perfect, or represent a
finished end-state which is wholly sustainable. But they do present
initiatives where real improvements have been gained and where efforts
are being made to continuously improve performance.
The case studies show that the trade opportunity is now a reality in
key sectors. Exports that serve sustainable consumption and production
are moving out of small, niche markets into the mainstream in terms of
volumes and consumer acceptance. The size of this emerging market is
still uncertain, but could be substantial. Already developing countries
earn an estimated US$500 million premium from organic exports.
The case studies also show that the benefits of higher social and
environmental performance of exports are many and diverse, including
economic gains (such as premium prices and increased sales), social
benefits (such as job creation) and environmental improvements, as well
as enhanced security through longer-term trading relations.
The case studies also demonstrated that pioneering companies,
non-governmental organisations, communities and co-operatives can make a
difference, often ahead of regulation or customer demand. But they also
showed that partnership along the product chain is central to success
for all producers, whether big and small, and that new commercial
relationships are emerging as a result. Importantly, the case studies
highlight that basic product quality and environmental sustainability
can be combined, and also that sustainable products need not be more
expensive than conventional brands. Nevertheless, in the initial stages,
insufficient supply can lead to higher prices.
The issue of capacity was central to the case studies. Smaller
enterprises need support to make the transition to better performance.
This can come in the form of financial assistance and technical support
along the product chain (e.g. through environment and development
organisations), as well as from government agencies. The case studies
underline the importance of independent certification of environmental
performance for winning consumer confidence, whether for organic cotton,
CFC-free fridges or sustainably sourced timber. Reducing the costs of
certification for smaller producers can be achieved through group
certification schemes and training local inspectors.
Lasting environmental improvements have to be rooted in solid social
development, such as enhancing the skills base and job creation. In
addition, local involvement is a prerequisite for success, and the case
studies are testimony to the initiative of developing country producers.
The policy framework is also a critical determinant of success, both
positively and negatively. The case studies highlight where trade
barriers in the industrialised world constrains environmental
improvement, and where perverse regulations and subsidies provide unfair
advantages to polluting and resource intensive production and
consumption. By contrast, a supportive policy framework in North and
South can help to bring partners together and ease the transition
process.
Ways Forward
Unlocking Trade Opportunities shows that the door is
now opening for developing country producers to benefit from changing
consumption and production patterns. The challenge is now to broaden the
number of developing country enterprises and economies that can turn
this raw potential into practical financial, social and environmental
gains. Key action points include:
- Collecting information and developing statistics to understand
market trends in key sectors and services affected by sustainable
consumption and production.
- Improving understanding of the crucial ingredients for successful
partnerships between business, environment and development
organisations and government agencies by drawing up good practice
checklists.
- Targeting development assistance at developing country exporters
who are trying to improve their performance, especially small and
medium sized enterprises.
- Promoting independent verification of standards and codes of
conduct. Retailers in industrialised countries have an important
responsibility for providing accurate information to the final
consumer.
- Stimulating greater convergence between the social and
environmental dimensions of trade by sharing experience among
leading businesses, environment, development and consumer
organisations.
- Improving market access for developing country exports in
industrialised country markets, particularly in the agricultural and
textile sectors.
- Reviewing and removing regulations in industrialised countries
that hinder access of sustainably produced exports from developing
countries.
- Reforming subsidies in both developed and developing countries to
create a level playing field for sustainable consumption and
production.
- Developing guidelines in industrialised countries for
transparency, consultation and the phasing in of proposed
environmental regulations.
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