Trade rules undermine action to address climate change

13 October 2016

As countries take action to protect the climate, conflicts between trade rules and climate goals will escalate, concludes “The Climate Cost of Free Trade,” a September 2016 report by the Institute for Agriculture and Trade policy. The paper digs into the Trans Pacific Partnership (TPP) trade and investment deal signed by the US and 11 other countries representing about 800 million consumers. It shows how this trade deal creates barriers for nations’ efforts to meet their commitments under the Paris climate agreement.

Under the Paris agreement each country produces an Intended Nationally Determined Contribution (INDCs) which includes goals, policies and strategies across various sectors to reduce greenhouse gas emissions and address climate change. The TPP agreement is first and foremost about expanding trade, often in highly extractive, energy-intensive sectors. The report argues that TPP rules impede countries from meeting their INDCs including in renewable energy policies, agriculture, carbon pricing and regulation.

The Transatlantic Trade and Investment Partnership (TTIP), the Comprehensive Economic and Trade Agreement (CETA) and other bilateral free trade and investment agreements negotiations led by the EU raise the same concerns as the TTP. Where references to the climate exist, they are evasive. Worse, government policies to incentivise more environmentally sustainable goods and services are open to challenge as being illegal, ‘technical’ trade barriers.

The report concludes that no climate deal will work if it is not supported by other policies. Fern would add that trade deals, and the powerful commercial interests behind them, cannot be allowed to undermine the broader public interest.

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