ENVIRONMENTAL GOODS AND SERVICES: AN ASSESSMENT OF THE

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ENVIRONMENTAL, ECONOMIC AND DEVELOPMENT BENEFITS OF

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FURTHER GLOBAL TRADE LIBERALISATION

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Organisation for Economic Co-operation and Development

2001

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TABLE OF CONTENTS

Introduction 5

I. COVERAGE OF THE ENVIRONMENTAL GOODS AND SERVICES INDUSTRY. 6

A. Mapping the environment industry 6

B. Identifying environmental goods for international trade purposes 9

C. Identifying environmental services for international trade purposes. 11

II. FACTORS IN INTERNATIONAL DIFFUSION OF ENVIRONMENTAL GOODS AND SERVICES,

INCLUDING TRADE. 25

A. Demand-side factors 25

B. Supply-side factors for environmental goods 30

C. Supply-side factors for environmental services . 38

III. THE POTENTIAL "WIN-WIN": THE ROLE OF TRADE LIBERALISATION FOR

ENVIRONMENTAL GOODS AND SERVICES IN IMPROVING ENVIRONMENTAL PROTECTION,

ECONOMIC EFFICIENCY AND DEVELOPMENT PROSPECTS 48

A. Improving the balance between the demand and supply-side factors – the role of complementary

measures. 48

B. The “win-win” proposition in action: case-studies of liberalisation of water and waste management

services markets in developing economies . 53

ANNEX 1: OECD/EUROSTAT ENVIRONMENTAL GOODS AND SERVICES INDUSTRY MANUAL

CLASSIFICATION . 60

ANNEX 2: ENVIRONMENTAL GOODS: ILLUSTRATIVE CATEGORIES WITH HARMONIZED

COMMODITY DESCRIPTION AND CODING SYSTEM (HS) PRODUCT CODES AND TARIFFS 66

ANNEX 3: BOUND AND APPLIED TARIFFS ON ENVIRONMENTAL GOODS IN FOURTEEN

MARKETS 73

ANNEX 4: MATRIX OF EXISTING GATS COMMITMENTS FOR ENVIRONMENTAL SERVICES77

ANNEX 5: INDICATIVE LIST OF MEASURES AFFECTING TRADE IN ENVIRONMENTAL

SERVICES 80

ANNEX 6: CASE STUDIES ON THE ROLE OF PRIVATE SECTOR MONOPOLIES AND EXCLUSIVE

RIGHTS IN THE PROVISION OF ENVIRONMENTAL SERVICES. 85

ANNEX 7: EXAMPLES OF THE “WIN-WIN” FOR ENVIRONMENTAL PERFORMANCE AND SOCIAL

DEVELOPMENT FROM TRADE LIBERALISATION IN WATER AND WASTE MANAGEMENT

MARKETS IN DEVELOPING COUNTRIES. 90

BIBLIOGRAPHY 107