• Environment
• Impact of trade
• Trade negotiations
• Natural resources

Environment

Trade exerts important influences over the exploitation and protection of natural resources. This article discusses the role of trade and trade-related measures in the use and conservation of natural resources. The paper presumes that this role is complicated by the context in which these resources are exploited.

The paper states that trade liberalisation in general can have many complicated and competing effects on resource use. Trade influences the management of renewable resources through several vectors:

• trade liberalisation can place pressures on resource stocks
• trade liberalisation changes relative prices, which affect exploitation incentives, and other factors of production
• trade can have broader equilibrium effects, such as on factor markets and incomes, which may affect demand for resource-intensive products
• trade policy obligations can also influence governments in their attempts to manage their resources
• trade can be a direct vector for introducing threats to ecosystems in the form of invasive species

The paper indicates that there are several international treaties related to resource conservation, and they explicitly recognise the role of international trade in achieving their goals. Toward these goals, Convention on Biological Diversity (CBD) activities include trade promotion for products using biodiversity resources in a sustainable way. However, they include also analysis and mitigation of the effects of trade liberalisation on biodiversity. Thus, two ideas simultaneously underlie the CDB: that trade can be an advantage to conservation goals, and that trade can be a threat to biodiversity.

The paper presents some policy implications, stating that the probably clearest recommendation is to support the improvement of resource management institutions and property rights. The paper recommends that particularly in the resource-dependent countries that lack these features, as they are essential for those countries to truly benefit from trade. Management regimes that are global in scope also help avoid the pressures on certain stocks arising from asymmetries in regulation. Furthermore, the paper discusses some of the considerations for evaluating the effectiveness of the two more popular measures:

• trade bans
• trade certification, or eco-labelling

The paper finds that trade bans are more likely to reduce harvesting pressures if they lower prices for the threatened wildlife products and thereby the return to poaching. It also notices that eco-labelling is growing in popularity, particularly for renewable resources.

The paper concludes that the key lesson is the importance of understanding the full economic, ecological and institutional context of the resource, or policies can indeed backfire.

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