Asian Regional Dialogue on Trade and Climate Change

29th – 30th April 2009 • Co-organised with the International Institute for Sustainable Development (IISD) and the International institute for Trade and Development (ITD)

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2009 promises to be a year full of challenges as well as opportunities. The global economic crisis has battered economies worldwide and coming out of it will test the capabilities of all nations - developed as well as developing – to be creative and resilient. At the same time it also offers a good occasion for policymakers to rethink the nature and patterns of investment and economic growth so as to make it more sustainable, economically as well as environmentally. The urgency and importance of tackling climate change and the need to build political consensus in the UNFCCC summit in Copenhagen towards the end of the year offers a good opportunity for countries to engage in constructive thinking and action to craft sustainable growth strategies.

The adverse impacts of climate change will be felt most heavily in developing countries. Trade can be an important tool in helping these countries build economic resilience and also aid worldwide economic recovery. Yet, such economic recovery will need to be responsive to the climate change needs and concerns. Business as usual is clearly not an option. A number of countries indeed are taking steps towards ‘greening’ their economies as part of economic stimulus packages to escape the crisis.

Since the Trade Ministers’ meeting on the margins of the UNFCCC’s COP-13 in Bali, there has been some basic agreement on and lively analytical debate of the nexus between trade and climate change. For the most part, the thrust has been for ways in which the trade regime might help address climate change, while at the same time furthering its own objectives (as with the possibility of liberalization in trade of low-carbon goods). There has likewise been some nascent thinking on how to ensure mutual supportiveness between the two regimes. Absent in large part from this however has been serious consideration of the implications of this debate for developing countries, and for overall development objectives such as the Millennium Development Goals particularly at a regional level.

As a contribution to this debate, the International Centre for Trade and Sustainable (ICTSD), The International Institute for Sustainable Development (IISD) and the International institute for Trade and Development (ITD) in Thailand is organising the Asia Regional Dialogue on trade and climate change, designed to bring out Asian developing country perspectives and input on the issues at the heart of the trade and climate change interface.

The objectives of the Asia Regional Dialogue are to:

1) Explore issues at the interface of trade and climate change that are of concern and
interest to the developing countries in Asia;

2) Identify a positive agenda able to contribute to engagement of Asian developing countries in the process of negotiations towards Copenhagen;

3) Provide a platform for interaction and exchange amongst climate change and trade negotiators; policy-makers, and other stakeholders in the private sector and civil society, in Asia.

The consultations will be multi-stakeholder, bringing together Asian NGOs, private sector actors and governments. Among the issues and questions sought to be examined include:

• What sorts of barriers are there to the diffusion and dissemination of clean energy
technologies? Are lPRs a significant barrier? What in-country policy changes might foster greater investment flows (both domestic and foreign)? What sorts of institutions, both domestic and international, might help address the problems?

• Would reform of the WTO subsidies structures be helpful to developing country
governments pursuing adaptation objectives (e.g., for supporting R&D, for helping firms meet pollution control costs)?

• What kinds of impacts would developing countries feel if border carbon adjustment measures were imposed in OECD countries? Would these be significant economically? Would they in the end be helpful or hindering in encouraging strong action on climate change from developing countries?

• What specific trade and competitiveness concerns may arise in developing countries as a result of action international to mitigate climate and how could they be addressed in both the trade and climate regime?

• What kinds of policy flexibility do developing countries need to pursue adaptation to pending climate change impacts particularly in sectors economically important to Asian countries? Do these needs suggest changes to the existing WTO rules in such areas as agriculture, or changes in the thrust of the Doha talks? What about regional or bilateral trade and investment agreements?

The answers to these questions and others will feed into the work programmes of ICTSD, IISD and relevant regional institutions on trade and climate change, and more broadly into the wider debates in the area. The results will be part of the input for trade and climate change meetings expected in Copenhagen’s seminal COP-15, and should also feed into any discussions on trade and climate change that might take place in the WTO setting.