At about the same time that Alois G P√ľntener was delivering his address to the IULTCS Congress on the challenge of REACH for chemicals and also leather imports into the European community, the proposals became law. This was a year and a few days later than originally anticipated.
The aim, which is very laudable, is to make Europe safer, healthier and environmentally more sound by ensuring that all chemicals present in the EU are registered and properly evaluated, then authorised and where necessary restricted.
The sad thing is, however, that despite lip service being paid to World Trade Organisation requirements regarding free trade and the elimination of tariffs, the REACH regulations are expected to throw up Technical Barriers to Trade (TBTs). It will cost the chemicals companies vast amounts of money to comply with REACH and it is expected to reduce the number of speciality chemicals on the market as the registration costs will make them prohibitively expensive.
At the IULTCS Congress in Washington in June, the opening speaker was international trade lawyer Larry Lasoff, who explained that as the tariff barriers were gradually being reduced non tariff barriers based on technical qualifications were taking their place. He said that international standardisation can enhance international trade but can also be used as unnecessary obstacles to trade.
There was a muttering among delegates who wondered how many companies would avoid much of the pain by manufacturing outside the EU and, of course, this would lead to job losses inside Europe. There is always a downside to governmental style rules and regulations and one frequently wonders if they actually intend to do the harm they cause.
In Pakistan, leather exports are second only to textiles yet when the government organised their Expo show it clashed with the APLF in Hong Kong and no amount of pleading with the authorities could bring about a change of date. Nor were there a super abundance of foreign visitors present at the Pakistan Expo.
In China the leather industry has been hugely successful, yet the uncertainty over vat and other duties is causing much disquiet. Are the government causing harm to the leather industry in their country because they genuinely want to tackle pollution or are they using this as an excuse to raise more revenue from the hapless tanner.
In several countries in Africa the governments are raising duties to prevent raw materials leaving the country. They say this is to protect the domestic leather industry but some of these countries do not actually have a leather industry. They say traders should set up tanneries and then set out to put every obstacle in their way.
The sad fact is that in many parts of Africa the tanning skills are simply not good enough to add value to the hide or skin. It was Unido that originally took up the cry to add value to raw materials before exporting and while their intention was good, the fact is that a good raw material badly tanned is a poor leather. And this at a time when the quality of raw materials has been declining for very many years.
Now the skill is in upgrading poor quality raw materials, something that tanners in Italy, for example, excel at. Their expertise has been built up over hundreds of years and is hardly something an inexperienced tanner in Africa is likely to achieve, even if his cousin is a government official.
Jean-Claude Ricomard, current president of Cotance, wants Zero Tolerance on protectionism, stating that certain barriers such as those in Brazil, Argentina, Pakistan and India have lasted too long. He says these measures not only damage competitivity but also block the development of less advanced countries, who remain in a state of chronic and forced underdevelopment.
He is ‘scandalized’ by the Reach regulations which are rigorously imposed on chemical products, but allow the import into Europe of products containing banned substances. It should be a regulation which takes care of the environment and the consumer but he believes that currently it doesn’t do this.