Dialogue on Trade, Poverty and Climate Change

20,21st of May, Kathmandu

20th – 21st May 2010 • Co-organised with SAWTEE and Centre for WTO Studies

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While climate change is a global concern, its impacts are anticipated to bring about extraordinary hardship to developing countries, especially to their poorest people. Indeed, exceptionally severe shocks from climate change can be unfortunately expected in many of these countries presenting a concentrated reliance on sectors that are highly exposed to climatic impacts, such as agriculture and fisheries. Risk would be distinctively acute for countries, and population segments within them, located in tropical and sub-tropical areas, in particular those with deficient or low capabilities to respond. Moreover, options to acquire or expand alternative livelihoods in response to biophysical impacts of climate may be limited where economic diversification is low, a frequent condition afflicting most developing countries.

In general, poor people are likely to suffer the most, as climate change is superimposed on existing vulnerabilities. Poor people are often directly dependent on goods and services derived from natural resources both for their own consumption and production. In today’s interconnected world, trade policy and international regulatory frameworks at global and regional level are likely to determine decisions on allocation and use of resources, including land. In this context, there are at least two dimensions at which climate change interfaces with trade policy that would be relevant to poverty. On one hand, as changes in climate are expected to alter productivity of important economic sectors and to devastate existing infrastructure, trade policy should be managed in such a way as to ensure that it enables – and, does not hamper – responses to adjust and adapt that favour in particular the poor. On the other hand, policy responses to climate change should be crafted and implemented in ways that preclude perverse impacts on growth opportunities of developing countries, including on trade-driven sectors of the economy relevant to the poor.