Unrestricted Global Trade Key to Tackling Climate Crisis, WTO Forum Highlights

Officials Urge WTO Members to Lower Tariffs on Green Goods and Emphasize the Role of Trade in Climate Solutions

Delegates at the recent World Trade Organization (WTO) Public Forum noted that while international trade is a contributor to greenhouse gas emissions, it also offers significant solutions to the climate crisis. The emphasis was on maintaining an open and free trade environment, especially for green technologies and products.

WTO Director-General Dr. Ngozi Okonjo-Iweala stated, “Trade is part of the climate solution framework, particularly through the transfer of green technologies. Achieving global decarbonization by 2050 is improbable without the facilitation of trade.” She urged the 164 WTO members to refrain from imposing trade restrictions on environmentally friendly goods and services and advocated for lowering tariffs on products such as electric vehicles and solar panels.

Dr. Okonjo-Iweala elaborated that constraining access to green technologies would hinder nations lacking production capabilities from adopting sustainable energy solutions. Her statements come amid growing environmental calamities like recent floods in Libya and wildfires in Canada and Greece.

Climate change’s influence on global trade patterns has led to vulnerabilities in the international economy. Case in point: recent governmental restrictions in India on non-basmati white rice exports resulted in a spike in rice demand from Thailand, pushing up prices by as much as 20%.

Borge Brende, President of the World Economic Forum, indicated that tripling renewable energy sources over the next decade is crucial to achieving net-zero emissions. He also urged governments to phase out fossil fuel subsidies while incentivizing renewable energy technologies.

An additional proposal from Dr. Okonjo-Iweala highlighted the potential for leveraging government procurement, a sector worth $13 trillion, or 13% of global GDP, to further green objectives. “By establishing green procurement criteria, we can incentivize the production of environmentally friendly goods,” she said.

The United Nations Conference on Trade and Development’s Deputy Secretary-General, Pedro Manuel Moreno, pointed out that the market for green goods and services is rapidly growing, with an annual increase of $10 billion to reach nearly $2 trillion in 2022. That accounts for 6% of global trade.

Moreno also emphasized that adequate climate financing is necessary for developing nations to transition to greener practices, with an estimated $2.4 trillion required.

The WTO forum’s discussions underline the critical role that unrestricted international trade plays in global efforts to combat climate change. Policymakers and stakeholders are encouraged to consider these insights for future international trade policies.