MULTINATIONALS, THE ENVIRONMENT AND THE WTO: ISSUES IN THE ENVIRONMENTAL GOODS AND SERVICES SECTOR AND IN CLIMATE CHANGE MITIGATION

Two linked topics concerning environmental issues at the WTO and their implications for MNEs are considered – namely, international business in the environmental goods and services sector, and the relationship of the WTO to the emerging climate change regime, particularly the Kyoto Protocol. Liberalization of barriers to international trade and investment in environmental goods and services could expand market access and otherwise change competitive conditions for multinational firms. The relationship of the WTO to the Kyoto Protocol is on the broader agenda of environmental and economic diplomacy. Decisions concerning these two sets of issues during the next few years will affect multinational firms’ competitive positions, strategies and operations in many industries. For instance, the liberalization of barriers to trade and FDI in the environmental goods and services industry creates new international market opportunities for firms that want to expand abroad; it also creates new competitive threats in home markets. The chapter was in press when the WTO Cancun ministerial meeting collapsed in mid-September 2003.