Commenting on my previous post, Schiller and Ivan defended the WTO’s recent GMO decision. They say that the WTO was right to condemn the EU for using (bunk) science as an excuse for agricultural protectionism.
I’m very sympathetic to the arguments that the GMOs are reliable and safe. My doubts about the ruling are not a result of an aversion to biotechnology. Rather, I fear that the WTO’s approach to handling environmental regulatory issues will imperil its ability to promote trade liberalization. The intersection of regulatory policy and protectionism will prove much more difficult to handle than the simple collective lowering of trade barriers as accomplished under the GATT. Moreover, the WTO will face a growing number of disputes over non-tariff barriers, especially as tariff walls decline.
The old shrimp & turtle dispute was a case similar to the GMO conflict, but the WTO ruled differently in that instance. It approved import prohibitions targeting a production method (use of shrimp nets without turtle escapes) deemed environmentally unfriendly. If the WTO recognizes trade sanctions and protectionism as legitimate means for promoting and defending environmental interests, then the dispute resolution panel will inevitably become a judge of scientific matters, rather than of compliance with WTO agreements.
If harmonizing trade barriers requires the harmonization of regulatory schemes, then the WTO will confront disputes regarding a plethora of non-trade issues. While I doubt that any state will soon challenge export or import bans regarding nuclear technology, one can imagine that the WTO may have to tackle issues like bans on the transfer of encryption technology. The WTO has already managed to entangle itself in the matter of intellectual property (pdf), a move which has been criticized by economists ranging from Bhagwati to Stiglitz. While most countries are interested in lowering trade barriers, many are much less comfortable with signing onto a global regulatory agency with far greater implications for domestic policy space.
Whether it’s feasible for the WTO to remain focused upon trade liberalization without experiencing mission creep into regulatory issues remains an open question. I don’t see a simple remedy for the problem of protectionism masquerading as environmental, labor or health policy.
Trade Diversion 
First: they should have thought about all this when they installed a trade dispute mechanism. Second, absent any scientific justification, disallowing new gmo’s is just another trade barrier. And it’s the task of the WTO to eliminate as much as possible trade barriers. If it’s not, then there is no use for a dispute settlement system. Third, intellectual property rights is no business of the WTO in the sense that it’s a rather odd thing for a trade organisation to defend and uphold trade barriers. Because that is what IPR’s are. The problem, from a view of free trade, is not that WTO has entangled itself into the matter of intellectual property. The problem is is that it’s standing on the wrong side.