Transcript No Slide Title

Biosafety and Trade Related Issues
Dr. Sachin Chaturvedi
Short-term Orientation Course on
“Biosafety and Biotech Regulations”
TERI School of Advanced Studies
9th February, 2006
1
Structure of the Presentation
•
Where Do We Stand in Biotechnology?
•
What are our Trade Interests?
•
Basic WTO Framework
•
SPS and TBT Issues
•
Trade Dispute
•
Balanced Perspective
•
India’s Trade Interests
•
Recommendations
Positive features
Negative Aspects
2
Emergence of Biotechnology
Adoption and diffusion of biotechnology has raised several
policy challenges for the governance of biotechnology
*
Trade regime,
*
International regulatory arrangements Cartagena Protocol
on biosafety
*
Regional and national standards
*
Release, safety assessment food use of genetically
modified organisms.
3
4
The Organizational Structure of the WTO
World Trade Organization
Dispute Settlement
Trade in goods
GATT 1994
Agriculture
Sanitary/phytosanitary
Textiles and clothing
Technical barriers to trade
Trade Policy review
Trade in services
Intellectual property
Plurilateral trade agreements
Civil aircraft
Government procurement
Trade-related investment measures
Dairy products
Anti-dumping
Customs valuation
Pershipment inspection
Bovine meat
Rules of origin
Import licensing
Subsidies and countervailing measures
Safeguards
5
Developments at WTO
*
WTO Ministerial Conference stated at Doha that negotiations
on issues relating to SPS measures will be addressed on
priority basis in the next ministerial conference.
*
The Committee on Trade and Environment (CTE) has been
instructed to give particular attention to the effect of
environmental measures on market access and trade.
*
This has become relevant in light of the fact that the past
decade has seen a global proliferation of environment and
health related standards along with a rise in the trade in
environmentally sensitive goods.
*
Since the inception of WTO some 12000 notifications have
been received and almost 17 per cent of them are related to
environment.
6
Emerging Issues in Trade and
Environment
*
Harmonisation of International Standards
*
Environmental Standards - Precautionary/Protectionist
- Food Safety Regulations
- Labelling Requirements
- Quality Standards
*
National Standards and Global Standard Setting Process
7
SPS and TBT Agreements
*
*
*
*
GMOs were not a trade issue when the SPS and TBT
Agreements were negotiated in 1994.
National Governments are free to choose their own
standards or follow international standards.
Currently, there are no international standards that
specifically govern GMOs nor is there a harmonization of
regulatory approaches mandated, although the SPS and
TBT Agreements have spurred countries to modify their
regulatory systems.
OECD is in the process of attempting to provide a process
that will allow its member countries to harmonize their
regulatory approaches for GMOs.
8
SPS and TBT Agreements
*
The International Plant Protection Convention (IPPC) covers
plant health and the environment but doesn’t make any
distinctions between traditionally developed products and
GMOs.
TBT Agreement:
– technical regulations and standards,
– packaging,
– marking and labeling requirements
– procedures for the assessment of conformity.
*
The disciplines of the both the SPS and TBT Agreements are
designed to prevent technical regulations from creating
unnecessary and arbitrary obstacles.
9
WTO: Trade Dispute
•
The US, Canada and Argentina introduced their first-time
panel requests regarding EC-level measures, the moratorium
maintained since October 1998 on the approval of biotech
products had restricted the imports of agricultural and food
products.
•
Regarding the EC member State-level measures, the
complainants said that a number of EC member States
maintain national marketing and import bans on biotech
products even though those products have already been
approved by the EC.
•
The US further clarified that the Sanitary and Phytosanitary
Agreement recognizes that WTO members may adopt
approval procedures for crops and food products, including
biotech products, in order to protect health and the
environment.
10
WTO: Trade Dispute
•
The US emphasized that the EC procedures, as written, are
not the focus of the US complaint. It is the EC's application
of its measures governing the approval of biotech products.
•
The US also expressed its concern that the EC measures
were hindering the worldwide development and application
of agricultural biotechnology – a technology which,
according to the US, has great promise for raising farmer
productivity, reducing hunger and improving health in the
developing world, and improving the environment.
•
Argentina added that agricultural products account for over
half of Argentina's total exports, and that it is the second
largest producer and exporter of biotech products in the
world. Argentina said that the EC's “behaviour” discourages
the introduction of the biotech process, and that it is
particularly detrimental because EC has the ability to
11
influence other WTO members.
WTO: Trade Dispute
•
In response, the EC expressed surprise and disappointment
at the panel requests. The EC said that it had repeatedly
made clear that the approval of genetically-modified
organisms and genetically-modified food was possible in
the EU that a number of applications were being examined
and decisions would be taken shortly.
•
The EC further pointed out that 18 GMOs and 15 food
products derived from GMOs have been approved and that
these GM products are imported each year by the EC.
•
The EC said that we need to chose the path of international
cooperation to build an appropriate framework for the
development of biotechnology, while seriously addressing
any potential risks and social concerns.
12
Balanced Perspective!!
Positive Points
*
Possible to better understand the genetic mechanisms behind key traits
in
the agro-industry, crop, fisheries, forestry and livestock sectors and to use
this information to produce GMOs with the desired characteristics.
*
Molecules for Biofuel
*
Vaccines through Plants/Fruits etc.
Status
The development, adaptation and use of GMOs have already made significant
inroads (18 countries; 47 fold increase in area under GMOs in 1996-2004)
*
*
*
GM soybeans account for almost 85 per cent of the global area planted,
and
have virtually replaced conventional varieties in the United States and
Argentina;
Transgenic cotton varieties cover about 20 percent of world cotton
area;
13
GM maize accounted for 45 percent of the global area in 2004.
Negative Points
*
Human health issues have been raised because
-
GMOs can be a direct source of food (by eating a GM plant,
animal or fish) or
An indirect source, where ingredients in processed foods may
be GM (e.g. soybeans are widely used in processed foods,
Or where domestic animals or fish, eaten by humans, may be
raised on GM feed.
*
Environmental issues have been raised because of potential
consequences of gene flow from GM to non-GM individuals of the same
species
*
The creation of “superweeds” that are resistant to insects, unfavorable
ambient conditions, or synthetic pesticides; adverse impacts on “nontarget” organisms (e.g., other plants, butterflies).
14
Regulation of GMOs
Regulation of GMOs is a central part of the general GMO debate
*
What kind of regulations they should be;
*
What exactly they should regulate;
*
How strict they should be;
*
How GMOs should be regulated compared to their conventionallybred counterparts;
*
What impact of regulation on the trade of GM products and on the
research and development climate for GMOs
15
Status
* The presence of GM products has affected trade, both in commercial transactions
and in food aid deliveries.
* Segregated markets are developing for non-GM products to accommodate
consumer preferences,
* Some countries focusing on supplying the markets for non-GM commodities
leading to mandatory labelling, testing and identity preservation throughout the
entire marketing chain.
* Which, inevitably, has increased handling costs and affected trade flows
* For research or commercial purposes there are at least 15 international
instruments. Seven of these are legally binding, namely the
UN Convention on the Law of the Sea (1982),
Convention on Biological Diversity (1992)
WTO SPS
WTO TBT
International Plant Protection Convention (1997),
Aarhus Convention (1998)
Cartagena Protocol on Biosafety (2000).
* FAO/WHO Codex Alimentarius Commission established the Ad hoc
Intergovernmental Task Force on Foods Derived from Biotechnology to consider
16
the health and nutritional implications of GM foods
Increase in agricultural trade among developing countries, 1985-90 to
1996-2001
The share of agricultural exports from developing countries that went to other
developing countries increased from 31 to 44 percent between 1985-90 and 1996-2001.
1985-90
1996-2001
4%
10%
31%
44%
59%
52%
Share of developing country agricultural exports to:
Developing countries
Central and Eastern European countries
Developed countries
17
Number of Employees of the biotechnology Industry in India
2001
Total
Technical
2003
Total
Technical
Agriculture
28520
(38.53)
3066
(20.74)
32623
(20.28)
12206
(31.29)
Healthcare
28520
(38.53)
3066
(20.74)
85600
(53.20)
11948
(30.63)
Environment
66
(0.09)
30
(0.20)
6136
(3.81)
3295
(8.45)
Industrial
Biotechnology
--
--
14514
(9.02)
3335
(8.55)
Others
16905
(22.84)
8619
(58.31)
22026
(13.69)
8228
(21.09)
Total
74011
14781
160899
390152
Source: RIS based on BCIL 2001 and 2003. Figures in parenthesis are
percentage share.
18
India’s Export of (Potential GM) Crops to World
US $ Million
2002
2003
2004
Vegetable
236.72
17.53
254.29
14.52
329.48
17.92
Corn
19.17
1.42
14.03
0.80
77.34
4.21
Rice
667.82
49.46
1221.43
69.73
909.44
49.48
Soybean
416.66
30.86
251.49
14.36
509.91
27.74
Mustard
9.95
0.74
10.43
0.60
11.94
0.65
Total
1350.32
1751.67
1838.11
Source: India Trades: CMIE (2005).
Figures in Pink are percentage share.
19
India’s Import of (Potential GM) Crops from World
US $ Million
2002
2003
2004
Vegetable
720.66
98.25
631.86
99.68
572.15
99.65
Corn
0.68
0.09
0.05
0.01
0.3
0.05
Rice
0.01
0.00
0.23
0.04
0.06
0.01
Mustard
9.68
1.32
1.77
0.28
1.64
0.29
Soybean
2.46
0.34
0.01
0.00
0.03
0.01
Total
733.49
633.92
574.18
Source: India Trades: CMIE (2005).
Figures in Pink are percentage share.
20
Corn Export
Quantity
200460,000 Tonnes
20051,50,000 Tonnes
Potential
5,00,000 Tonnes
Price
12 per cent higher $ 140 Tonnes (FOB)
Preference by countries like South Korea and Malaysia over
US/China Corn.
21
The EU has been pursuing a three-dimensional strategy that seeks
to define and employ the precautionary principle globally:
*
The EU has sought to inject it within the WTO system at large through
creative interpretation of the SPS and TBT Agreements and through
incorporation within them of obligations assumed under multilateral
environmental agreements
*
The EU has sought to incorporate the precautionary principle within
international standards through active and skilled participation in the
international standards development process.
*
The EU has begun to incorporate it within bilateral and regional free trade
and aid agreements and within EU trade capacity-building initiatives offered
to developing countries. Apparently, the EU is attempting to elevate the
status of the precautionary principle from a limited WTO exception to a
‘norm’ of general customary international law equal in importance to general
principles of international trade law.
*
Even if the EU were able to establish the precautionary principle as a norm
of customary international law, its ability to incorporate that norm within the
22
SPS and TBT Agreements remains uncertain.
Labelling
EU/Japan/South Korea/Australia/New
Zealand/China
Threshold Value
(Tolerance for GM Impurity)
EU/Switzerland
0.9 per cent
Japan
5 per cent
Australia
1 per cent
South Korea
3 per cent
Brazil
4 per cent
Thailand Soybean
5 per cent
Corn
3 per cent
23
Key Policy Issues
Since the implementation of the Cartegena Biosafety Protocol
*
Policy and institutional issues to bridge the gap between the protocol and
national biosafety guidelines.
*
In this regard, some of the possible areas for initiative are being listed below:
1. Capacity Building
-
-
BCH: Strengthening and Enhancing/RegionalSub Regional
Zonal Institutional Committees
Capacity of Quarantine Agency
Risk Assessment and Risk Management (Related
Methodologies)
Custom & other Document (Trade Facilitation)
24
2. Cooperation with Other Ministries
The implementation of Cartegena crucially depends upon policies and
commitments of other ministries such as Ministry of Commerce engaged at
WTO especially in its committees like that of TRIPs, SPS and TBT.
Similarly, Ministry of Agriculture and their policy towards GM and initiative
at forums like FAO should also be engaged. The role of DBT is equally
important determinant in the process.
3. Notification Article 8
-
Indian biosafety guidelines have yet to come out explicitly on the issue
of notification.
-
The requirements by a party of export to ensure notification and
accuracy of information contained in the notification by the exporter
-
The contours of advance informed agreement and its linkage with BCH
also need immense clarification.
-
Elaborate upon the related liability and redress mechanisms that would
be in place.
25
4. Brief and Clear Trade Information
• Summary of what is needed before LMOs can be exported
• For any LMO export intended for other than contained use in the
importing country, the exporter will need to comply with specific
conditions of export pursuant to the Prohibition Order before
approval for export will beganted.
• The exporter is provided with a reference number confirming the
export has been approved (if this approval is not obtained the export
cannot proceed).
• The exporter provides with the relevant details of nature of proposed
export, the intended country of import and the receiving facility.
26
5. Points for Policy Consideration
* Costs and benefits have to be weighed up when
considering the monitoring and enforcement aspects of
GMO regulations.
* Balance between the potential environmental and
health risks viz. a viz. economic interest.
* Risk analysis and compensation mechanism to be
developed.
6. National Biotechnology Regulatory Authority
27