Commodity Corner
Views on commodities and energy
from Global News Journal:
Can export bans be challenged at the WTO?
Russia’s ban on grain exports as a heat wave parches crops in the world’s third biggest wheat exporter has raised questions whether such export curbs break World Trade Organization rules. Russia is not a member of the WTO, and it remains to be seen how its new grain policy will affect its 17-year-old bid to join. But other grain exporters, such as Ukraine, which is also considering export curbs, are part of the global trade referee.
WTO rules are quite clear that members cannot interfere with imports and exports in a way that disrupts trade or discriminates against other members. But in practice most WTO rules aim to stop countries blocking imports – shutting out competitor’s goods to give their own domestic producers an unfair advantage.
One of the most fundamental short-comings of the WTO rules is that they prohibit import restrictions on ethical grounds. For example, in 2012 EU will make it illegal to keep chickens in battery cages because of the extreme cruelty involved. Switzerland did so in 1992. However, imports of eggs from countries with much lower standards, such as US, cannot be stopped.