“We show how Switzerland could boost sustainable trade”

The debate is heating up: How can we achieve sustainable food systems? After all, there is a great deal at stake: the climate, our food security, health, agriculture, biodiversity, fairness. Trade rules are a key lever to foster sustainable and diverse food systems and curb unsustainable ones – and Switzerland’s Federal Constitution stipulates their use for this purpose, says Elisabeth Bürgi Bonanomi, senior legal expert at CDE. Together with a research team, she now presents how corresponding rules could be designed in accordance with international law.

“If Switzerland strives to shape its trade policy more proactively, it can make an important contribution to the international debate”: Elisabeth Bürgi Bonanomi. Photo: Manu Friederich

Interview: Gaby Allheilig

In your research project, you investigated how states – especially Switzerland – can promote diverse food systems via trade regulations. What’s the reason for this particular line of inquiry?

In a 2017 referendum, Switzerland established the constitutionally anchored goal of ensuring an adequate food supply for its population. With Art. 104 a lit. d, it also resolved to shape its trade relations in a way that promotes sustainable food systems – at home and abroad. But, so far, this provision has only marginally been fleshed out with content. As a result, ideas and proposals are needed regarding how to implement it. From a legal-science perspective, there is also a need to address how exactly Art. 104 a lit. d should be interpreted. We offer answers to these questions in our research project.


“It makes a difference whether or not our consumption fuels deforestation or supports sustainable livelihoods”


Concretely, the question still arises: Why devote research to exploring how trade measures can be used to promote more sustainable, equitable food systems?

The underlying question is: How can we successfully ensure food security, here in Switzerland and elsewhere? Of course, it’s important that we preserve soil fertility at home, arrange our own production in the most environmentally friendly and diversified way possible, and afford producers a decent living. But we also need to grasp the global nature of our food system. What we import – what raw agricultural commodities or processed foods – influences food systems, natural resources, and producers in other countries as well as our own. So, it is vital to look closely at international trade and ask how the traded goods were produced: Whether our consumption fuels deforestation or supports the development of rich landscapes, makes use of biodiversity or destroys it, enables the people involved to lead a dignified life or not.


“The government must act in complement to the private sector in order to strengthen helpful initiatives and reduce shortcomings”


And why is it up to the state to advocate and promote sustainably produced goods?

Switzerland has set itself the goal of fostering sustainable food systems. Consequently, the federal government has the responsibility to create a legal framework that makes it possible to achieve this goal. At present, it is largely left to private actors to improve value chains, certify products, and so on. Evidently, these approaches are not enough. The public sector has a role to play.

But we as consumers have the choice of buying organic and fair-trade products or not.

It’s not a question of the government replacing private certification schemes. Rather, the federal government must implement measures in complement to the private sector in order to strengthen helpful private initiatives and reduce shortcomings. There is a lot of uncertainty around private certification schemes. Most people don’t understand what’s behind the various seals proclaiming different sustainability designations. The term “sustainable” isn’t protected, and there isn’t any public mechanism for quality assurance. The situation is different with organic certification. Use of the term “organic” requires that certain criteria are fulfilled, which are set by the federal government. Public authorities could adopt a similar approach with other terms related to sustainability. Moves in this direction are advocated by consumer-protection organizations and other circles today.


“In order to comply with the WTO, you have to consider domestic and foreign production together”


Much of what gets called sustainable isn’t actually sustainable…

Exactly, in our research project, we don’t just show how the government can serve a quality-assurance function with certification schemes. We also show how we can use and design trade measures to support sustainable food systems and prevent unsustainable ones at home and in our partner countries. However, distinguishing what is “sustainable” or “unsustainable” is challenging. So, we took a different approach: We identified which production methods are especially beneficial and simultaneously vulnerable, such that they can be strengthened via improved market access; and which are particularly harmful and should be traded less.

But if we want to link imports with particular requirements, we must always consider domestic production as well. Based on our WTO commitments, we must proceed in a non-discriminatory manner. Among other things, that means we need to be consistent and apply the same incentive systems and requirements domestically.


“Our hypothetical legislative proposal is meant to inspire debate”


In Switzerland, we have voted on similar issues several times in recent years, including the provision on palm oil in the trade agreement with Indonesia, the two anti-pesticide initiatives, and the initiative to abolish factory farming. All of them had elements designed to promote sustainable food systems, along with corresponding trade provisions. With the exception of the Indonesia agreement, they failed at the ballot box. Now you are presenting a legislative proposal on how agricultural trade could be regulated in a sustainable way. What makes you think a law like this can fix things now?

We don’t expect our hypothetical legislative proposal to be taken up as is by policymakers. But we hope to inspire debate and show how Switzerland could proceed in concrete terms. In other words, we wish to show how agricultural trade could be managed in a more differentiated way, without too much bureaucracy and in the greatest possible compliance with WTO commitments – that is, in a non-discriminatory way.

Moreover, the initiatives you mentioned were not primarily about trade issues – they concerned trade only tangentially. This was different with the referendum on the EFTA–Indonesia agreement, in which tariff reductions were linked for the first time to sustainability criteria – namely regarding a certain portion of palm oil imports to Switzerland. And precisely this aspect was at the heart of the referendum – and was approved by a majority of the population.


“WTO members have some leeway to handle products differently based on how they were produced”


So, the WTO rules offer more leeway than is often claimed, and you’ve now identified it?

To be clear up front: We don’t claim that our hypothetical act is guaranteed to stand up in WTO arbitration. But we have written it in such a way that it could pass. We’ve analysed the WTO rules and case law in detail. WTO jurisprudence is not uniform, and at the same time it is evolving. A lot depends on the specific way a country designs its corresponding measures. And it also depends on whether, in the event of a dispute, the WTO arbitration panel opts to interpret existing laws in the context of current challenges and with the sustainability agenda in mind. In any case, it is widely recognized by now that WTO members have some leeway to handle products differently based on how they were produced. But there are a number of criteria to consider. Among other things, measures must be designed to be context-sensitive and fair.

What is meant by context-sensitive?

That Switzerland cannot, for example, demand that a Kenyan supplier or a Chilean cooperative produce goods one hundred per cent according to Swiss rules. By contrast, arguing that production standards must be equivalent in order to benefit from particular incentives puts things on a safer footing.


“The EU clearly wants to move in this direction”


So, Switzerland should spearhead a new approach?

Switzerland is not alone in this effort. There have been various attempts to make better use of WTO leeway. This year, for example, the EU clearly stated in a study that it wants to go in this direction. It has presented a regulatory package containing various product differentiations, including a regulation on deforestation-free supply chains. If it is adopted, the EU will soon stop importing soya, meat, palm oil, timber, cocoa products, and coffee if they are linked to deforestation. Swiss companies that export to the EU will also be impacted. At the same time, the EU seeks to apply a partnership approach.

If you want to make differentiations, it involves criteria that have to be monitored and checked. Doesn’t that entail a huge amount of bureaucracy?

Not if you opt for a partnership approach rather than a control approach, as in our proposal. Similar procedures already exist, for example in the organic sector. Here, Switzerland recognizes many certifications from around the world as equivalent. We can build on this and further develop these procedures.


“We do applied science, but not politics”


As a team, you explored the question of how to shape sustainable agricultural trade from a variety of perspectives and disciplines. But with this hypothetical act, you go a step further. Is it the task of science to show governments and policymakers what they should do?

We do applied science, but not politics. Research funds are increasingly tied to the condition that resulting knowledge contributes to the public debate and political processes. Our project is embedded in the “Sustainable Economy” research programme of the Swiss National Science Foundation, which enables and promotes such innovative research approaches. This requires us to present our findings in a way that is easily accessible and understood. So, we chose to render our synthesis very concretely in a hypothetical legislative act, in hopes that this will make our work more accessible.

How can the proposal now find its way into policy debates?

We’re discussing it at a final conference with a wide range of stakeholders. There’s a lot of interest in it. What becomes of it is not in our hands. But we’re continuing to work on the issue in other projects and are also trying to raise it to the European and international level. There’s a great deal happening there at the moment in terms of the trade-and-sustainability agenda. If Switzerland strives to shape its trade policy more proactively, it can also make an important contribution to the international debate.

Research project and hypothetical federal act on sustainable agricultural trade

An interdisciplinary research team from CDE, the Institute of Federalism of the University of Fribourg, Agroscope, Ekolibrium, and the University of Basel has produced numerous studies that illuminate various aspects of trade differentiation. The “Hypothetical act on sustainable agricultural trade” is its synthesis work. The project is funded by the Swiss National Science Foundation.

Hypothetical federal act on sustainable agricultural trade (in German) (PDF, 296KB)