Bridges Trade BioRes • Volume 9 • Number 12 • 26th June 2009

Joint WTO-UNEP Report Details Linkages between Trade and Climate Change

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A new report, jointly published by the WTO and the UN Environment Programme (UNEP), offers policy makers and other stakeholders an in-depth analysis of the links between trade and climate change. Underscoring that most sectors of the global economy will be affected by climate change, the report indicates serious implications and opportunities within global trade.

To promote a greater understanding of the linkages between climate change and trade, the report study looks at the issue from four different but correlated perspectives: the science of climate change; trade theory; multilateral efforts to tackle climate change; and national climate change policies and their effects on trade.

In a summary of the current state of scientific knowledge, the study highlights the Intergovernmental Panel on Climate Change (IPCC) findings that the warming of the earth’s climate system is “unequivocal” and human activities are “very likely” the cause of the present situation. More troubling, the report says, is the persistence of greenhouse gas (GHG) emissions that remain in the atmosphere for long periods of time with no reduction in emissions projected for the coming decades.

In discussing the analytical frameworks used to conceptualise the impacts of climate change, the report identifies the links between increased economic activity and increases in GHG emissions. However, the report also highlights the ability of trade to facilitate a reduction in GHGs by encouraging technology transfer to developing countries. Widespread adoption of climate change mitigation technologies would be enhanced by a more open global market, reducing the emission intensity of goods and their production processes.

However, speaking at the report’s launch at the WTO on Friday, organisers cautioned that challenges still remain in developing trade and climate change policies that complement one another. For instance, small vulnerable economies (SVEs), such as Jamaica, Mauritius, and Palau are at exceptional risk to the effects of increasing GHG emissions; a situation, they say, that has mostly been created by the world’s developed economies. SVEs tend to be more vulnerable to rising sea levels, in addition to more intense hurricanes and landslides, which can devastate economies that depend on agricultural trade.

International policy responses will be critical to determine an effective multilateral response to reduce global GHG emissions. The report discusses national policy efforts that employ a range of mechanisms, such as regulatory measures enforcing standards and regulations, as well as taxes and tradable permits.

The study’s authors say the implications of climate change for regulatory and economic structures are innumerable. The joint WTO and UNEP report aims to provide essential information on the role of trade in mitigating and adapting to climate change impacts.

Additional information

The full report can be accessed here: http://www.unep.org/pdf/pressreleases/Trade_Climate_Publication_2289_09_E%20Final.pdf

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