Bridging the Trade-Environment Divide

P rotection. For free traders, this word represents the consummate evil. For environmentalists, it is the ultimate good. Of course, for the trade community, “protection” conjures up dark images of Smoot and Hawley, while the environmental camp sees clear mountain streams, lush green forests, and piercing blue skies. One cannot blame all of the tensions at the trade-environment interface on linguistic differences, but these competing perspectives are emblematic of a deep clash of cultures, theories, and assumptions. Trade officials often seek to limit efforts to link trade and environmental policy-making, and sometimes to prohibit such efforts altogether. In this regard, the narrow focus and modest efforts of the World Trade Organization’s Committee on Trade and Environment are illustrative. The launch of negotiations for a Free Trade Area of the Americas with an express decision to exclude environmental issues from the agenda provides an even starker example of the trade community’s hostility toward serious environmental engagement. Economists have been prominent among those arguing that pollution control and natural resource management issues are best kept out of the trade policy-making process (Cooper, 1994; Bhagwati, 1999). Other economists, however, have tried to set trade policy-making in a broader context and to build environmental sensitivity into the international trading system (Runge, 1994; Rodrik, 1997; Summers, 2000).