The WTOs creation on 1 January 1995 marked the biggest reform of international trade since after the Second

World War. The WTO replaced !TT as an international organi"ation# but the eneral !greement still e$ists as the WTOs umbrella treaty for trade in goods# updated as a result of the %ruguay &ound negotiations. ! gro'ing number of de(eloping countries look to trade and in(estment as a central part of their strategies for de(elopment# and trade considerations are increasingly important in shaping economic policy in all countries# de(eloped as 'ell as de(eloping. !t the same time# ho'e(er# most of the 'orlds en(ironmental indicators ha(e been steadily deteriorating# and the global achie(ement of such important ob)ecti(es as the *illennium +e(elopment oals remains (ery much in doubt. The legal te$ts and decisions of the WTO adopted at the *arrakech *inisterial *eeting in !pril 199, included a +ecision to create the WTO -ommittee on Trade and .n(ironment. .(er since this point of time# the relationship bet'een WTO rules and *.!s has been one of the most acti(ely discussed issues on the -T. agenda.Since the WTO and *.!s represent t'o different bodies of international la'# the relationship bet'een them needs to be as clear and coherent as possible. /undamental shift is occurring in the nature of cross0border conflicts implicating trade and en(ironmental concerns. 1et# it is one that the public at large appears to be missing. While many assume that -hina# 2ndia# and other de(eloping countries continue dragging their feet on implementing en(ironmental policies# these countries# along 'ith some of de(eloped countries# are actually deploying traditional industrial policies to spark rene'able energy sectors and capture these nascent markets. !lthough the first0order moti(ation for these policies may be )ob creation and economic de(elopment# they are ne(ertheless positi(e for the en(ironment. 3e(ertheless# these policies ha(e led to a series of trade conflicts because the instruments deployed to e$ecute the industrial policy often (iolate WTO rules. 2n addressing the link bet'een trade and en(ironment it 'ould appear that at the inter0go(ernmental le(el# the accepted approach is that trade and en(ironmental policies can complement each other. .n(ironmental protection preser(es the natural resource base on 'hich economic gro'th is premised and trade liberalisation leads to the economic gro'th needed for ade4uate en(ironmental protection. 5o'e(er# to ensure success# it is important that en(ironmental policies do not act as obstacles to trade liberalisation# and that trade rules do not stand in the 'ay of ade4uate domestic en(ironmental protection.