IS FREE trade in shrimps more important than saving turtles from extinction? Of course not, environmentalists argue. Which is why some are up in arms at a WTO ruling on October 12th. It decided that America breaches international trade law by banning shrimp imports from countries which use nets that also trap turtles.
Despite the fuss, the WTO's latest move is a big step towards resolving the real issue: how to champion free trade while preserving an endangered species. And since it concedes that the environment, like trade, merits WTO protection, it will have wide repercussions.
Existing WTO rules allowed exceptions for conservation measures, so long as they were not a disguised form of protectionism and did not discriminate unfairly between countries. In this case, however, the WTO initially condemned America's embargo on shrimps from India, Malaysia, Pakistan and Thailand out of hand.
This week's appeal judgment was less clear-cut. It recognised America's right to protect sea turtles. The trouble was how it went about it—by imposing its rules unilaterally, rather than by negotiating turtle-protection agreements, as it had with countries in the Americas. Indeed, moderate greens cheered the WTO's decision, for showing a deeper appreciation of the need for environmental exemptions. They also welcomed the freedom they will now enjoy to put their cases to future WTO dispute-settlement panels.
In response to the ruling, America has said it will step up efforts to secure international agreements protecting turtles. It is also considering modifying its import ban by limiting it to offending fishing fleets, rather than countries. That would greatly reduce its scope, since most banned shrimps are actually farmed, not fished from turtle-inhabited waters.
If America fails to comply with the ruling, the four Asian plaintiffs can demand compensation or erect trade barriers of their own. American disobedience would also undermine its pressure on the European Union over bananas and hormone-treated beef.
That pressure mounted on October 14th with American threats of sanctions if the EU fails to comply with WTO rulings. America's turtle setback, however, will encourage the country's protectionists, green-leaning Democrats and other WTO critics.
It will also boost calls for more transparency at the WTO, which many see as remote, unaccountable and secretive. Opening up the WTO's workings may be no bad thing. It might even dispel the fears of those who think free-traders cannot also care about turtles.
This article appeared in the Finance & economics section of the print edition under the headline "Turtle soup"
From the October 17th 1998 edition
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