[CTC] Analysts: Only way to tackle climate change is to reform trade policy

[Arthur Stamoulis]

Analysts: Only way to tackle climate change is to reform trade policy
By Hannah Monicken, Inside US Trade 
4/16/2021
Addressing climate change will require reforming and reorienting trade policy, environmental analysts said on Thursday, arguing for a “new trade model” that prioritizes people and the planet over corporate interests.
Following U.S. Trade Representative Katherine Tai’s remarks <https://insidetrade.com/daily-news/v> to the Center for American Progress on Thursday, panelists <https://www.americanprogress.org/events/2021/04/07/497929/greening-u-s-trade-policy/> from four prominent environmental advocacy groups pushed for the U.S. to take advantage of the opportunity presented by the Biden administration and Tai’s confirmation to rethink trade policy to facilitate climate action, rather than hinder it.
“The reality is, unless we transform trade, it will be a thorn in the side of Build Back Better,” Sierra Club’s Ben Beachy said, referring to the Biden administration’s plan for post-pandemic recovery. “This race to the bottom that has been enabled by unfair trade is clearly a strike against not only climate action, but also good jobs and racial equity. And it’s actually contributed to literally half of our industrial pollution.”
Specifically, the advocates urged USTR to prioritize trade enforcement – and the enactment of enforceable provisions – as well as a carbon border fee, marginalized communities and combatting subsidized overfishing.
While Tai, in her remarks on Thursday, did not get specific on policy ideas like a carbon border adjustment mechanism, she did argue in favor of enforcement, urge World Trade Organization members to secure a deal reining in fisheries subsidies and pledge to include frequently sidelined voices in USTR’s work.
Colette Pichon Battle, executive director of the Gulf Coast Center for Law and Policy, argued that trade is an important element of environmental justice. It’s not just about changing policies, she added, but about ensuring those affected have their voices heard and can be part of the decision-making process.
Beachy argued that one of the main policy changes USTR should consider is a climate border fee. Properly designed, he argued, it would turn the race to the bottom into a “race to the top.” He sketched a framework for such a mechanism that would be applied to raw materials, using Chinese steel as an example import.
The production of Chinese steel, he said, requires more than twice as much carbon as does the production of U.S. steel. Accordingly, the fee for its import into the U.S. would be the amount of emissions used to make the steel in China minus the emissions used to make the steel domestically, multiplied by a certain percentage.
What a WTO-compatible <https://insidetrade.com/node/169948> carbon border adjustment mechanism looks like remains unclear. WTO members are likely to get the first crack at such a discussion later this year when the European Union unveils its proposal for such a measure.
The fact that whatever trade-related climate measures countries put in place can be challenged – and potentially found in violation – by the WTO is likely to hamper bold climate action, Beachy argued. “Now is not the time for countries to be dialing down their own climate ambition for fear of a WTO case,” he insisted, advocating instead for a “peace clause” that would protect climate-related measures from challenges.
“Now is the time for, if anything, to seek out a peace clause at the WTO so we don’t have more tit-for-tat cases where countries are challenging each other's climate policies on the basis of outdated trade rules that were written largely under the advice and counsel of fossil fuel companies,” he continued.
Other analysts have proposed a climate waiver, although others argue it is not likely in the near term.
On overfishing, Andrew Sharpless, CEO of Oceana, argued that to rein in distant water fishing fleets, which account for a large portion of overfishing, countries must prohibit fuel subsidies. He noted that China has by far the world’s largest distant-water fishing fleet, with about 3,000 vessels. The EU, by comparison, has about 300 vessels, he added. 
Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826




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