Unilateral efforts to address climate change raise concerns that the domestic industry in the restrained economy will see its competitive position deteriorate. This may lead to market-share losses and consequently a relocation of emissions. Options are available to address such concerns, such as free allocation of emission allowances, internationally negotiated sectoral agreements or measures at the border to equalize carbon costs.
On these subjects, ICTSD’s Global Platform on Climate Change, Trade and Sustainable Energy undertakes research and analysis and organizes policy dialogues across policy communities, with the aim of promoting equitable and nondiscriminatory approaches to addressing carbon leakage while optimizing the efficiency with respect to abating emissions.