OECD Trade and Environment Working Paper 2007-02 Part I by Fliess and Kim E-mail
Wednesday, July 15, 2009

Surveying 136 exporting firms from ten OECD and non-OECD countries, this study documents the incidence, and impact of, non-tariff measures that are perceived to act as barriers to trade in seven sectors of environmental goods and associated services. Although the DDA has a mandate to address inter alia such trade barriers, information shedding light on the specific problems that firms encounter in their export activities has been scarce.

Accounts by exporting firms in Austria, Brazil, Canada, Chile, France, Germany, India, Japan, Korea and the United States suggest that environmental goods indeed face a variety of obstacles when traded abroad. Firms participating in the survey mentioned relatively often problems associated with product testing and certification requirements, customs procedures, regulations on payment, problems with intellectual property protection, government procurement procedures and technical regulations and standards. Certain types of reported barriers appear to be more prevalent in certain markets. For example, customs procedures reportedly pose a problem predominantly in developing and transition economies and problems with intellectual property rights are associated especially with China. The non-tariff barriers reported by the firms appear to be generic and not specific to the environmental sector. The study shows that in many countries the environmental industry consists mostly of SMEs, for whom cost-raising barriers pose disproportionately greater problems due to their limited resources.

Business Perceptions Of Non-Tariff Barriers (Ntbs) Facing Trade In Selected Environmental Goods And Associated Services: Survey Results

Introduction

Barriers to trade in non-agricultural products, including non-tariff measures (NTMs) affecting these products have been at the centre of trade policy discussions and will receive continued attention in the course of coming years. Although some of these measures serve legitimate policy purposes ranging from the protection of public health or security to the preservation of natural resources and the protection of the environment, there is a growing consensus among economists that NTMs are often more traderestrictive and distorting than tariffs. The importance of NTMs is also underlined by the growing number of NTM-related disputes brought to the Dispute Settlement Body of the WTO.

Despite the growing importance of non-tariff barriers (NTBs), there is still limited understanding of their prevalence and impact on trade in environmental goods and associated services. This is partially due to the complex nature of the measures and practices involved and the difficulties of collecting and analysing relevant data. Unlike tariffs, NTBs are not subject to comprehensive reporting requirements in the WTO. Also, the effects of NTBs on trade and economic welfare are complex and not readily measurable: NTBs can take many forms and can quickly change, which renders NTB analysis all the more difficult. NTM data are mostly collected using a pragmatic, bottom-up approach of surveying exporting firms. Any list of NTMs is bound to be long. While several initiatives have been taken to construct a typology or classification system, broad consensus is lacking among scholars, countries and international
organisations on this matter.

This paper reports the findings from surveys conducted with firms from ten countries. Overall, the purpose of this project is to identify and document, on the basis of reported company experiences:

  • NTMs3 perceived by exporters of certain types of environmental goods4 to represent major barriers to their exports;
  • NTMs perceived as prevalent in specific environmental sectors, in specific export markets, and for small and medium enterprises (SMEs);
  • Perceived effects of NTBs identified on firms’ export activities in seven environmental sectors;
  • Responses to or strategies for overcoming the reported obstacles, at company and government
    levels.

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