Natural resources and global value chains: What role for the WTO?

Natural resources are critical to global value chains as minerals, good climate and fertile soil are commonly required for the beginning of the chain, with the consequence that any interruption in their supply threatens the chain's continued integrity. Trade in such resources provides a valuable source of income for resource-rich states. Yet exploitation of natural resources can result in their exhaustion and biodiversity loss, while their extraction can lead to environmental damage and human rights abuses, with the result that any positive contribution to sustainable development for resource-rich states is quickly undermined. Effective regulation is critical to maximise benefits and minimise potential harm. The WTO's rules seem ideally suited to allow the state to impose measures that militate against the overexploitation of the resource by corporations, whilst simultaneously ensuring that that regulation does not unnecessarily impede the flow of resources within the value chain. However, this paper will show that applying the WTO's rules to natural resource use in global value chains presents both substantive and normative challenges.