Press Release September 2005 - UNEP Warns of Trade Liberalisation Failure if Environment Forgotten - United Nations Environment Programme (UNEP)
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UNEP Warns of Trade Liberalisation Failure if Environment Forgotten

GENEVA/NAIROBI, 20 September 2005 – Six case studies on the rice sector underline that free trade without environmental considerations can lead to negative impacts on developing countries.

The reports, published in advance of the crucial World Trade Organization (WTO) meeting to take place in Hong Kong, argue that economically costly soil degradation, water pollution, loss of biodiversity and destruction of forests can be the consequences of environmentally-insensitive trade liberalization.

Other consequences include earnings impacts on local producers, especially small-scale farmers, and surprisingly consumers. This is because traders and trading cartels often do not pass on the price reduction to shoppers.

“It is critical that we get an agreement in Hong Kong and from the Doha Round that frees up agricultural markets for poorer countries, but this should not come at the expense of the natural environment,” said Klaus Toepfer, Executive Director of the United Nations Environment Programme (UNEP), which supported the new studies.

“We need to use trade to lift large numbers of people out of poverty while maintaining and promoting a healthy, clean and environmentally sound planet,” Toepfer said. “But it is equally important to have safeguards so that countries do not use the environment as an excuse for banning imports, so called 'green protectionism'."

“As the latest UNEP-backed rice studies show, countries are starting to address the complex links between the need to liberalize trade and the need to protect the world's forests, fisheries, wetlands, wildlife and other precious natural resources," said Toepfer.

Without the right environmental policies in place, trade liberalisation could have negative consequences for developing countries and not achieve its long-term objectives.

The environmental impacts of increased trade in agricultural products are potentially devastating, and countries must urgently establish policies to protect their natural resources as well as those that enable them to reap the economic and social benefits.

This stark warning from UNEP follows the release here today of six new reports on the environmental impact of trade liberalisation in the rice sector in China, Colombia, Indonesia, Nigeria, Senegal and Vietnam.

It also comes just days after world leaders meeting in New York re-affirmed their commitment to trade liberalisation and with just three months to go before a critical WTO meeting in Hong Kong where trade ministers will push for further liberalization under the round of negotiations agreed to in Doha, Qatar.

The UNEP-backed studies, while varying in detail from country to country, present an overall picture of negative environmental impacts of trade liberalisation, (with resulting increase in rice production), where appropriate policies are not in place.

Such impacts range from the growing use of agro-chemicals (pesticides) and the resulting soil degradation, water pollution and loss of biodiversity to the increased destruction of forests and wetlands as demand for new agricultural land intensified.

The UNEP-backed studies focused on the rice sector due to its importance in many countries in terms of food security, poverty reduction, environmental impact as well as its significant role in terms of culture and the economy.

“One goal of the studies was to gather some broad conclusions that will enable more informed policy-making in the complex trade and environment area,” said Hussein Abaza, head of UNEP’s Economic and Trade Branch, which led the work.

“Our work on the rice sector, and elsewhere, shows that while on the face of it, trade liberalisation brings overall economic benefits, you need to look closely at the ‘winners’ and ‘losers’ and the long-term costs of environmental degradation and loss of natural resources.”

The “winners” identified in the rice studies were importers, middlemen, certain categories of producers (large-scale) and the government. The “losers” tended to be local producers, especially small-scale farmers whose income has declined, and unexpectedly in some cases, consumers, since traders (cartels) often do not pass on the price reductions.

Some of the other conclusions from the rice studies were:

* minimizing environmental damage should be addressed from the outset when designing trade policies

* when integrated policymaking is not realized before environmental damage occurs, it can have high economic costs

* raising awareness is crucial in inducing decision makers to adopt strengthened environmental policies

* assessment methodologies and policy response packages must be adapted to reflect local conditions, needs and priorities

* inter-ministerial coordination is an important element of policymaking

* open, transparent and informed multi-stakeholder process is crucial to policy assessment and implementation

Under the auspices of UNEP, the leaders of the rice study reports and government officials from the respective countries are presenting their findings, recommendations and follow-up activities at a meeting today in Geneva.

The country studies are available on the web at:

For more information please contact: UNEP Economics and Trade Branch in Geneva on +41 22 917 8243, Or Robert Bisset, UNEP Spokesperson for Europe on +33 1 44377613, +33 6 22725842, E-mail: Or Michael Williams, UNEP Information Officer on +4122 917 8242, +41 79 409 1528,

In Nairobi, contact: Nick Nuttall, UNEP Spokesperson, Office of the Executive Director, on Tel: +254 20 62 3084; Mobile: +254 733 632 755,email:

If there is no prompt response, contact Elisabeth Waechter, UNEP Associate Media Officer, on +254 20 623088, Mob: +254 720173968, email:

UNEP News Release 2005/46




Further Resources

Spanish version of the Press Release

Rice Reports
Country Studies

UNEP Economics & Trade Branch


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