Canada’s Environmental Choice Program and its Impact on Developing-Country Trade

Abstract

This chapter presents a case study of Canada’s Environmental Choice Program (ECP) and its impact on developing-country trade.¹ Section I introduces the Canadian eco-labelling programme with a discussion of ECP’s objectives and features. Section II focuses on the nature and extent of the trade impact of the ECP on developing countries. The concerns of developing countries regarding the impact of eco-labelling programmes on market entry and competitiveness are assessed against eco-labelling and ECP. In addition, this section includes an evaluation of the programme’s impact on the behaviour of both consumers and producers, some of the key findings of the market analysis and programme evaluation undertaken by external consultants, and a summary of the new initiatives and priorities adopted by ECP following its own programme evaluation. Based on this information, an appraisal may be made of how developing-country trade is presently affected by the programme and how it may prospectively be affected by changes in ECP. Section III pinpoints how ECP and Canada can be of assistance to developing countries intending to apply for the EcoLogo and/or intending to establish a national labelling system of their own. Section IV summarizes the major findings of the study and presents a scenario of where eco-labelling is headed and how it may be transformed as an instrument of environmental policy.