This is the first of two volumes that draw together a series of working papers produced over the last three years for the OECD’s Joint Working Party on Trade and Environment (JWPTE) and the Working Party of the Trade Committee. Its aim is to help to understand the challenges in WTO and regional trade negotiations relating to initiatives on “environmental goods and services”.

This chapter presents a synthesis of 17 country studies on environmental goods and services (EG&S) commissioned by the OECD, UNCTAD and the UNDP. The countries examined are Brazil, Chile, China, Cuba, the Czech Republic, the Dominican Republic, Guatemala, Honduras, Israel, Kenya, Korea, Mexico, Nicaragua, Pakistan, Panama, Thailand and Vietnam. Its aim is to identify determinants of demand for EG&S; to show common themes and experiences in the EG&S markets of different countries; and to draw attention to key trade, environment and development policy linkages.

This chapter compares two lists of environmental goods that have been used in the WTO negotiations on liberalising trade in environmental goods and services. It describes the genesis of the lists, which were compiled in the late 1990s. The OECD list was developed as a basis for analysing trade and tariffs.

This chapter explores some practical issues that have arisen in the WTO negotiations on environmental goods and services, especially issues pertaining to liberalising trade in environmental goods. Since environmental goods are not covered by a single chapter of the Harmonized Commodity Description and Coding System (HS) — the international basis for codifying trade and tariffs — an agreement on environmental goods must be defined by reference to an agreed list.

This study is part of ongoing OECD work on trade in services, in co-operation with UNCTAD, to assist WTO members manage request-offer negotiations under the GATS. The objective is to help officials in WTO members both to gain greater insight into issues of importance in the environmental services sector and to see how they might be approached in the negotiations. The current GATS negotiations offer WTO members an opportunity to achieve greater liberalisation of environmental services, and this may lead to significant economic and environmental benefits for all countries.

This chapter examines the synergies between trade in environmental services and trade in environmental goods. Environmental services are here defined as wastewater management services, solid-waste management services, sanitation and similar services and other environmental services. Services related to the collection, purification and distribution of water are also discussed. After describing each of the environmental services, the chapter identifies broad categories of goods used in their performance and notes that, for some goods, environmental services are driving growth in their markets.