A new study suggests international trade deals hinder progress on climate change.
The study by authors Dan and Natassia Ciuriak was released in conjunction with the University of Calgary’s School of Public Policy.
The report is called “Climate Change and the Trading System: After Doha and Doha”
Dan Ciuriak is Director and Principle of Ciuriak Consulting, and a research fellow at the C.D. Howe Institute specializing in international trade, finance and development.
The report tracks development after the Doha climate talks in December 2012 failed to create a binding followup to the Kyoto Protocal, and the Doha Round of trade talks also stalled, leaving in limbo many issues, including how to accommodate climate change mitigation efforts within trade rules
“trade and climate change policies are colliding without agreed rules to sort out the problems inherent in their intersection.” (Ciuriak & Ciuriak: After Doha and Doha)
Dan Ciuriak points out in the interview that there are many sweeping regional agreements under negotiation but these cannot address truly global issues like climate change.
The report mentions the World Bank has pointed out the serious consequences of a 4-degree Celsius increase in global temperature and why it must be avoided at all costs. In spite of that, multilateral consensus on how to deal with trade issues and climate change mitigation policies remains elusive.
The document also describes mitigation actions being driven by “bottom-up” activism at the personal, municipal, some corporate, and sub-national levels, but the actions differ widely in disciplines imposed and costs. These efforts fall well short of what is needed to reduce emissions on a global scale.
Three areas are indicated as hurdles.
First, competitiveness concerns are constraining action, the authors argue, as national governments hesitate to take actions that impose costs on their industries when other countries are not following suit.
Second, when jurisdictions implement climate change initiatives which are costly to develop, international trade rules permit enterprises outside that jurisdiction-and not subject to those costs- to compete in the initiative, thus getting a “free ride” so-to-speak and placing enterprises inside the jurisdiction at a disadvantage, a process known as “leakage” to the free-riders.
Third, climate mitigation measures usually involve public monies, but delivery on the measures is private, which in turn gets into conflict with international rules on subsidies.
The authors say that in order to move ahead there must be flexibility allowed in trade rules so that policies and actions to mitigate climate change can be “carved out” of standard trade disciplines.
They also note that failure to act on creating and implementing climate change policies and directives will have far, far greater costs to nations than any potential costs from creating domestic and international mitigation measures.
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