WWF/Oxfam Response to the Phase Three SIA Methodology

WWF and Oxfam have published a joint response to the final report on the Phase Three SIA methodology (http://www.balancedtrade.panda.org/pdf/siamethodology.doc). This response is reproduced below, together with a commentary on the WWF/Oxfam observations.

WWF/Oxfam response	Manchester University comment
WWF and Oxfam welcome this, the final, report from Manchester University developing a methodology for carrying out Sustainability Impact Assessments (SIA) of WTO negotiations. WWF and Oxfam recognise that assessing the impacts of trade negotiations is complex and demanding, and recognises the Commission’s efforts to develop a methodology to achieve this.
This latest version of the methodology is a significant advance on previous reports and goes a long way to addressing many of the concerns WWF and Oxfam have raised. We particularly welcome the proposal to carry out an ex post evaluation of negotiations and the inclusion of process indicators. However, problems remain. Some concerns highlighted by our previous submission (attached) and other parts of civil society are still not adequately addressed and the methodology requires further development. SIAs are important tools than can help deliver more sustainable trade, but they are limited. They cannot rectify negotiating agendas that are inadequate which fail to recognise and address the impacts of trade on sustainable development. They are designed to guide negotiations towards more sustainable outcomes.
Scope
The methodology remains unnecessarily restrictive in its approach and places too much reliance on mitigation and enhancement (M&E) measures as the primary mechanisms to deliver more sustainable trade. M&E measures are valuable tools and identifying such measures is an important function of the assessments, but they are not the sole means of delivering more sustainable trade.	The methodology report places a wide interpretation on M&E measures, including modifications of the trade negotiation scenarios, which may be built into a WTO agreement itself.
The pro-liberalisation bias built in to the methodology (see our previous submission) excludes other measures such as no growth or trade in a different form. SIAs should guide and inform trade policy. If they are restricted to dealing with the problems of liberalisation rather than exploring different options and questioning underlying models SIAs will fail to realise their full potential as policy tools and close off alternative policy scenarios before they can be considered. For example, the methodology recommends ignoring scenarios which negotiators have no interest in considering. While this might be a very practical approach, it is heavily geared towards the position of the negotiators, who have traditionally approached this issue from a trade-oriented perspective. SIAs should inform negotiating positions, not simply assess them. There may be instances where a recommendation may diverge completely from an existing position, but if, backed up by solid evidence from the SIA, it is worth considering.	If the SIA shows significant negative impacts it may result in a change of negotiation positions.
Our concerns over the influence of non-WTO drivers of liberalisation – such as regional trade agreements – and the cumulative effect of pressures towards liberalisation remain unaddressed, as do our concerns that the framework seems to ignore the fact that there are limits to sustainability. (See our previous submission for a fuller explanation of our concerns in these areas).	The purpose of this particular SIA is to evaluate this particular component of trade liberalisation. Other components should however be reflected in the determination of the baseline. Where limits to sustainability are identifiable within the scope of the study, they are catered for by taking account of existing environmental stress and incremental impacts on it.
Timing and prioritisation
The report should be more closely aligned to the negotiating agenda of the Doha round and should give more guidance on how to prioritise areas for study. The negotiating agenda is broad. Time and resources are limited and it is essential that the most important issues are addressed. Resources will have to be focussed on issues, sectors and regions where the impacts are expected to be greatest. But the report does not indicate how it proposes to identify priority issues or country groupings. The SIA should inform the debate – from a sustainability point of view – on the desirability of including Singapore issues.	Criteria for prioritisation of areas for study have been developed, and are published in the inception report on the first sector studies.
Closely related to this point is the issue of timing. It is essential that studies are scheduled carefully so that the results can feed into the negotiations. Some areas of Doha are on a fast track (e.g. DSU), and cannot wait until 2005 for SIA results. Therefore some studies should be started before others. We also urge the Commission to keep in mind opportunities for input during the negotiations – e.g. Mexico in 2003 – when structuring the study. Preliminary findings related to the key issues and sectors should be available to feed into the process when important decisions will be taken on the direction of the negotiations. The timing of the studies should be geared towards maximizing these opportunities in the context of what is now a clearer negotiating framework than existed in 2000.	This is agreed, and has guided the Commission’s selection of areas for the first sector studies.
Stakeholders
WWF and Oxfam welcome the prominent role that the methodology allows stakeholders in the Phase III SIA. We emphasise that it is essential to consult frequently and proactively with all relevant stakeholders and to include stakeholders in the process from the beginning and at key points during the process. Stakeholders should be involved in making key decisions guiding the analysis – for example in developing scenarios for assessment and selecting individual countries for inclusion in any expansion of the analysis beyond regional groupings.	The proposed scenarios, countries to be analysed and key issues to be studied are published in the sector study inception reports, for discussion with stakeholders prior to finalisation.
It is also important to involve stakeholders in assessment of M&E measures, and stakeholder acceptability should be one of the criteria considered when assessing M&E measures.	Consultation on the mid-term reports will provide stakeholder input on the assessment of M&E measures.
Scenarios
We are disappointed at the limited range of scenarios that will be considered by the study. Providing in effect two base scenarios – existing agreement as currently implemented and existing agreement fully implemented – is an improvement. But retaining just one middle of the road scenario and a strong liberalisation scenario is unnecessarily restrictive and will inevitably favour the middle of the road scenario.	The purpose of the scenarios is to provide reference points from which a wide range of alternatives may be considered.
The argument that other parties can construct their own scenarios is not valid as few have the resources to do so. We urge the Commission to consider expanding the number of scenarios assessed and to consult with stakeholders on how to construct these scenarios.	We anticipate that the SIA will provide sufficient understanding of the variability of impacts to allow other parties to estimate the impacts of their preferred scenarios.
We welcome the idea of expanding the analysis beyond regional groupings to individual countries depending on their vulnerability and trade structure. Support should be given to developing countries wishing to carry out their own assessments and the results of these assessments should feed into the overall Phase III SIA. Consideration should be given to the role that stakeholders – particularly those from developing countries – can play in selecting which sectors, regions and countries are the subject of expanded analyses.	The evaluation of studies carried out by other parties is an important part of the SIA. Support for such studies is beyond the scope of this project, but the SIA will identify those which are particularly worthy of further analysis.
Indicators and scoring
The methodology has expanded the number of indicators to include a “second-tier” of supporting indicators. This is a great improvement, as is the inclusion of a handful of “process” indicators, though there is still no clear rationale for selecting the indicators.	The rationale for selecting indicators will be developed more fully during the study, on the basis of the experience gained.
The list of indicators is still too limited and more guidance could be given on selecting ones appropriate to scenarios and regions. The nature of issues under consideration in Doha is huge, and it may be that wide variations will exist not only among regions, but between and among issues themselves. The wider the range of indicators available, the greater the flexibility of the approach and the greater the likelihood that it will be able to capture the key issues.	The indicators serve two purposes: to provide a concise summary of effects, for which a limited number is necessary; and to identify specific effects, for which second-tier indicators may be identified.
The scoring mechanism for assigning “significant” impacts remains questionable. Issues such as cumulative impacts, long-term effects, irreversibility and limits to sustainability are not adequately addressed. There needs to be a recognition that the cumulative effect of seemingly small impacts can be significant, as can their effect over time. Similarly the impacts of one area or sector have to be considered in conjunction with the impacts from other sources. The SIA should be capable of highlighting where limits to sustainability are in danger of being reached or surpassed, and this should be a criteria for allocating significance, as should irreversibility. These points deserve more thorough treatment in the report.	Scoring is intended only to give a concise summary of results, for which greater detail will be provided in the text. The methodology provides for a final overall assessment to evaluate interactions between areas and sectors. Reversibility is one of the factors identified as contributing to significance, as is the extent of existing environmental stress (related to sustainability limits).
The additional requirement for the scoring matrices to be supported with textual explanation is an important improvement as is the increasing of the scale, but the aggregation of a whole range of complex impacts into a blunt scale presents potential problems – not least being the trading of positive scores in one area against negative scores in another.	These problems are recognised. As the methodology is put into practice a balance will be sought between the presentation of concise summary information and essential detail.

IDPM 18.7.02