Global chem industry proposes WTO reforms to lower trade barriers

Author: Al Greenwood

2021/09/13

HOUSTON (ICIS)--A group representing the world's chemical trade organisations is urging the World Trade Organization (WTO) to adopt policies and reforms that would clear up trade barriers and make it easier for countries to buy and sell the materials critical for everything from automobiles to healthcare to sustainability.

The International Council of Chemical Associations (ICCA) outlined the proposals in a consensus paper it released on Monday.

“No one has seen an entire global industry coalesce around clear actions for the WTO membership quite like this before," according to a statement by Lisa Schroeter, global director of trade and investment policy at Dow and chair of ICCA’s Trade Policy Network.

"We look forward to partnering with the WTO to help reaffirm its position as the cornerstone of the multilateral, rules-based trading system and help leverage trade to create a safer, healthier and more sustainable world," said Ed Brzytwa, director of international affairs at the American Chemistry Council (ACC).

The ICCA released its position paper at a time when the flow of trade goods is already being constrained by factors outside of WTO policy. Shipping rates have soared, causing global markets to splinter into regional ones. The coronavirus pandemic has restricted production at manufacturing plants and activity at ports. Winter Storm Uri and Hurricane Ida shut down chemical plants in the US that supplied goods to markets around the world.

Regarding sustainability, one challenge is the existence of conflicting regulations among trade partners, said Alejandra Acosta, former regulatory official with the Ministry of Environment and Sustainable Development of Argentina. In other instances, environmental policy is lacking.

Either of these can worsen environmental threats and make it more challenging for countries with the greatest needs to obtain chemical products, she said. Addressing these challenges can promote health and the environment while reducing trade barriers.

For Africa, a rules-based, multilateral trading system remains critical for countries that lack commercial power, said Catherine Grant Makokera, director of Tutwa Consulting Group and trade consultant to the South African Chemical and Allied Industries’ Association (CAIA).

Chemicals are essential raw materials for many products and materials, so ensuring their uninterrupted supply is critical for policymakers around the world, said Abdulwahab Al-Sadoun, secretary general of the Gulf Petrochemicals and Chemicals Association (GPCA). "I am pleased to see ICCA’s recommendations come at just the right time, as global free trade faces a growing threat in countries across the world and trade protectionism is on the rise."

Brzytwa said manufacturers are still reeling from one of the most volatile trading environments in recent memory.

“ICCA analysed the myriad challenges our members have faced first-hand over the past five years and put that experience to work developing a comprehensive, detailed and actionable set of recommendations for WTO reform," Brzytwa said.

In developing the proposals, the ICCA gathered input from countries from around the world.

The group plans to discuss its proposals later in September at the WTO Public Forum.

Another key event for the ICAA paper is the 12th Ministerial Conference (MC12), which will take place on 30 November to 3 December. The conference is the highest decision-making body of the WTO. It is attended by trade ministers and other senior officials from the 164 members of the WTO.