Draft Guideline for Environment Impact Assessment of Trade Policy in China

Hu Tao Policy Research Center for Environment and Economy, SE

PA, CHINA

Mao XianqiangSchool of Environment, Beijing Normal University

Prepared for OECD WORKSHOP ON REGIONAL TRADE AGREEMENTS AND THE ENVIRONMENT June 19-20, 2007

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Outline

Necessities of EIA on Trade policy

2 Key points in the EIA guideline

Capacity building needed

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Necessities From China’s practices

To understand better the environmental implication of China’s accession to WTO

To ensure the environment is part of China’s national interests of WTO Doha round negotiation

To unveil the environmental problems and benefits of FTA/RTA negotiation

To realize environmental problems resulted from domestic internal trading

To achieve environmental goals by trade measures, together with consumption measures and production measures

To adjust sector trade policies which are environmentally harmful

To achieve sustainable trade by greening current trade policy

In a word, trade policy EIA is the fundamental basis of any trade policy adjustment towards sustainable development

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Necessities From international experiences

OECD, RTA EU, SIA UNEP, IA Canada, SEA US, ER An EIA on trade policy (RTA, WTO, sector trade

etc) is needed From legal perspective

China’s EIA Act We SEPA are authorized to do EIA at Project level and

planning level EIA on policy is needed Trade policy is a pilot phase of policy EIA

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Key points in the EIA guideline

Mechanism of trade affecting environment Direct effects

Environmental regulation effect Technology diffusion effect EGS effect Environmental bads/services effect

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Key points in the EIA guideline

Mechanism of trade affecting environment Indirect effects

Scale effect Composition (structure) effect

Polluting industry migration in the world Carbon intensive industries shifting from Annex I

to non Annex I Efficiency effect

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Key points in the EIA guideline

Measurement of trade balance accounting from environmental perspective Trade balance measured by monetary value

indicator Trade balance measured by physical indicator Trade balance measured by environmental

indicator (direct and indirect trade impacts) Virtual water Virtual carbon Virtual SO2 Etc

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Capacity building needed

Technical assistance of improving the guideline of trade policy EIA is needed

Training is needed for EIA researchers and practitioners

Legal expertise is needed to support EIA Act Revision

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Thank you for your attention!