APEC wrestles with 'green' products

VLADIVOSTOK, Russia - A push to free up Asia-Pacific trade in environmentally friendly goods has hit a rough patch amid bickering over whether products such as bicycles and honey are "green", diplomats said.

Trade officials preparing for an Asia-Pacific summit this weekend in the Far Eastern Russian city of Vladivostok have been in talks to draw up a list of green goods whose tariffs would be cut to five percent or less by 2015.

Economies belonging to the Asia-Pacific Economic Cooperation (APEC) grouping hope that slashing tariffs on such products will boost their use and help cut greenhouse gas emissions blamed for climate change.

APEC leaders who met in Honolulu last year had directed officials to come up with a list of such products by the end of this year.

However, there have been disagreements on what should be in the basket, with the United States wanting a "credible" list of products, China pushing to include bicycles and others saying honey is also an environmental product.

"There is a very broad definition of what is an environment good. It ranges from bicycle parts to honey," said Donald Campbell, co-chair of the Pacific Economic Cooperation Council (PECC) think tank, which is an observer at APEC.

"Every country has sensitivities. So matching different countries' sensitivities becomes difficult."

US officials have said the list should include core products such as those used in renewable energy, pollution control and waste water treatment.

A Southeast Asian diplomat involved in the talks but who asked not to be named said there was also no agreement on the definition of an environmental product.

"The inclusion of bicycle is not a joke, it's serious," the diplomat told AFP.

China has argued a bicycle is a green product simply because it does not use fossil fuels for power.

But the diplomat said other countries had insisted the materials used to make the bicycles and the production process should be taken into account when determining if the pedal-powered machine is green.

There is also the problem of whether to include products having dual usage, according to the diplomat. For example, pipes used for solar energy hot water systems can also transport oil.

Russian Minister of Economic Development Andrey Belousov, whose country is this year's APEC host, said Wednesday trade officials had agreed on 20 product groups to put on the list, without giving details.

However, he said developed economies in the 21-member APEC wanted more and officials would meet again Thursday in an effort to expand the list.

Analysts said it was difficult to make an accurate estimate of the market potential for environmental products.

But the APEC Policy Support Unit, the grouping's research arm, studied trade patterns for a list of 164 potentially environmental goods that the EU and several developed countries, including the US, suggested to the WTO in 2007.

Global trade in the listed goods rose at an average annual rate of 12.8 percent between 2002 and 2010, when it reached $871.5 billion, with APEC members responsible for $443.5 billion of international sales, the unit said.

Products used in renewable energy plants, waste water management and potable water treatment as well as management of solid and hazardous waste registered the biggest trade volumes in 2010, the unit said.

The policy unit said the initial findings show the market is "potentially huge" and called also for the removal of cumbersome certification procedures and other non-tariff barriers. - Martin Abbugao, Agence France-Presse

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