The New Trade Agenda: Technology, Standards, and Technical Barriers

Abstract

The New Trade Agenda: Technology, Standards, and Technical Barriers John Sullivan Wilson (bio) A number of highly significant developments in international standards, product conformity regimes, and trade that have occurred in recent years will have an important impact on industrial activity and global commerce into the twenty-first century: there are new disciplines on technical barriers to trade at the multilateral level in the Uruguay Round Agreement. Regional trade negotiations between Europe and the US continue regarding a comprehensive and pathbreaking Mutual Recognition Agreement for the acceptance of testing, product certification, and laboratory accreditation. The most highly developed regional agenda on regulatory reform and standards has been undertaken in the Asia Pacific Economic Cooperation (APEC) forum, with members agreeing to a program for standards reform as part of APEC’s overall goal of open trade in the region by 2020. 1 Standards and national systems for testing, certification, and laboratory accreditation are an increasingly important part of industrial production and global trade. Efficient international standards systems can accomplish several important goals, including facilitating the diffusion of innovative technologies and supporting economies of scale through improved production techniques. 2 The benefits of well-organized, open, and [End Page 67] transparent standards systems also involve the assured compatibility of key components in national infrastructure, such as telecommunications and computer networks. 3 National technical regulations can also support public welfare by promoting quality assurance systems and health, safety, and environmental goals. Finally, the development of modern, efficient standards and conformity assessment procedures are central to raising product quality and the expansion of global export markets. The Asia Pacific Economic Cooperation (APEC) forum may be particularly well-suited to promoting these types of goals. As global tariff rates have fallen and non-tariff barriers to trade are reduced, technical barriers have become some of the most serious obstacles to regional trade expansion. In the past decade, for example, approximately 15 percent of all notifications to the General Agreement on Tariffs and Trade (GATT) of non-tariff barriers, involved some form of technical regulation. APEC members recognize the need to provide a stronger regional framework to mitigate against a continued rise in these disputes. Moreover, the world trading system, especially in the rapidly expanding regions of Asia, will confront new requirements in environmental standards introduced in draft form by the International Standards Organization (ISO). As a greater share of economic activity in developing APEC members is driven by private firms, building a modern standards infrastructure to support quality, safety, and reliability has taken on heightened importance. Although there are obvious social welfare benefits associated with standards, the work required of manufacturers to achieve and demonstrate conformity has the potential to present complex and costly new barriers to international commerce. APEC’s work to promote regional cooperation and dialogue represents a unique opportunity to aid in the reform process. Opaque standards adopted to favor inefficient domestic producers can retard technological advances which are of critical importance to all APEC members. Technical barriers to trade embedded in discriminatory certification requirements, or regulations which deviate widely from internationally accepted scientific principles present some of the most serious problems for firms operating in global markets today. These go [End Page 68] beyond instances where there are differences among national standards, or cases where countries refuse to accept any foreign test data in regulated product markets. Some of the less understood, but serious problems in the Asia-Pacific region involve: opaque testing and certification requirements often set at higher standards for imports; costly, confusing, and discriminatory product labeling rules; manipulation of domestic laboratory accreditation regimes to block imports; and mandatory compliance with unnecessary and unduly burdensome quality system registration schemes. This article will review new initiatives in the international arena to streamline and reform standards and conformity assessment systems. It will focus on the possible contributions of APEC to regional and multilateral trade liberalization. The material addresses mandatory government product standards and technical regulations, but does not address issues associated with sanitary and phytosanitary (SPS) standards specific to the protection of human health and regulation of trade in agricultural products. 4 As the prospects for success in APEC initiatives will be affected by developments at the multilateral level, the 1994...