[CTC] Progressive trade groups push for climate peace clause ahead of TTC ministerial

Fri Dec 2 13:13:33 PST 2022

Two articles below…

Progressive trade groups push for climate peace clause ahead of TTC ministerial
Inside U.S. Trade, December 1, 2022 at 4:45 PM
A group of progressive advocacy organizations is urging the U.S. and the European Union, ahead of their Trade and Technology Council ministerial meeting next week, to implement a broad climate peace clause to avoid trade disputes bogging down efforts to lower carbon emissions and the transition to clean energy.
“As two trusted trading partners committed to tackling climate change, a Climate Peace Clause is a common-sense step the U.S. and EU can take right now to show leadership both on trade and on climate,” Arthur Stamoulis, executive director of Trade Justice Education Fund, said in a statement <https://tradejusticeedfund.org/new-analysis-shows-how-a-climate-peace-clause-could-end-increasing-trade-attacks-on-green-jobs-initiatives-other-climate-measures/>.
A climate peace clause is, essentially, a truce between countries, a commitment not to pursue trade litigation on climate-related measures for a period of time. The Trade Justice Education Fund, along with the Sierra Club, on Thursday released a paper <https://tradejusticeedfund.org/wp-content/uploads/ClimatePeaceClausePaper.pdf> outlining how such a clause could be implemented, the benefits of it, and what kind of exceptions it would need not to conflict with labor rights and other environmental protection commitments. According to the paper, Public Citizen’s Global Trade Watch, the American Economic Liberties Project’s Rethink Trade and the Environmental Defense Fund also contributed.
A climate peace clause is necessary, these groups argued, because countries remain off track to meet their Paris Agreement commitments and “[c]losing the gap will require governments to dramatically ratchet up climate action and ensure the rapid transition of energy, industrial, and transport systems.”
“Yet trade and investment rules, written long before governments had committed to tackle climate change, are increasingly being used to directly challenge and indirectly discourage governments’ climate and renewable energy policies,” the paper adds, citing a number of World Trade Organization disputes brought by various countries challenging other members’ environmental measures on trade grounds as well as recent threats of disputes from the EU and South Korea over certain green subsidies and electric vehicle tax credits in the U.S. Inflation Reduction Act.
The idea of trade truce on climate-related measures is not totally new. James Bacchus, a former Republican congressman and a former World Trade Organization Appellate Body member, for instance, has previously suggested WTO member should adopt a waiver to WTO rules for climate policies <https://insidetrade.com/node/170897> if they meet certain criteria as a way of avoiding a collision of trade and climate policy.
Additionally, a leaked TTC draft in April included a climate peace clause proposal, but it has not appeared in any officially released statements or documents since then. U.S. officials have declined to comment <https://insidetrade.com/node/174116> on the measure; whether it remains on the table in TTC talks is unclear. But the groups on Thursday urged the U.S. to take up the climate peace clause cause at the ministerial on Dec. 5.
The paper notes that the WTO could negotiate such a climate peace clause, but, citing the organization’s “infamously slow process,” it advocates for countries to pursue the idea in other fora, including TTC, the Indo-Pacific Economic Framework for Prosperity, the Americas Partnership for Economic Prosperity and U.S.-Kenya trade talks.
Specifically, the climate peace clause proposed by the groups would be broad, self-judging and time-limited– the groups suggested a duration of 10 years, renewable as many times as needed for the international community to ensure trade rules can be updated to complement climate change efforts rather than “pos[ing] numerous direct conflicts,” the paper says.
This clause would cover all measures aimed at “mitigat[ing] greenhouse gas (GHG) emissions and/or support[ing] the transition to a clean-energy economy, whether directly or indirectly,” the paper says.
The broad scope would allow the clause to cover a wide range of potential mitigation measures and remain flexible for future efforts, the groups argued. “Given the very wide variety of potential climate mitigation policies and measures that different countries may favor, any attempt to list or more narrowly define the types of measures covered would almost certainly exclude some,” they said.
The clause would be self-judging, the paper says, to “avoid establishing a new, likely cumbersome and time intensive dispute settlement process.”
“This means that it is the responsibility of the signatories of the Climate Peace Clause to judge when it is appropriate to respect their commitments to observe the truce inherent in the Peace Clause,” it adds.
Finally, this clause should not get in the way of labor rights and other environmental protection efforts, the groups said. To ensure this, the climate peace clause would not apply to labor and environment chapters of trade agreements, allowing countries to continue to bring disputes to ensure those commitments are being upheld, the paper says.
“Governments must have and use every tool in the toolbox to ratchet up climate ambition,” the Sierra Club’s Hebah Kassam said in the Thursday statement. “[W]e simply do not have time for governments to continue using outdated trade agreements to attack and undermine climate action.” -- Hannah Monicken (hmonicken at iwpnews.com <mailto:hmonicken at iwpnews.com>)
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https://www.commondreams.org/news/2022/12/02/climate-activists-tell-macron-stop-using-trade-rules-thwart-clean-energy

Climate Activists Tell Macron to Stop Using Trade Rules to Thwart Clean Energy
"Governments should be empowered to fight climate change and support the clean energy transition without fear of being undermined by antiquated trade rules," said one advocate.

Environmental campaigners implored French President Emmanuel Macron to stop inhibiting sorely needed climate action by weaponizing global trade rules during a Thursday night protest outside the White House, where U.S. President Joe Biden hosted Macron for the first state visit of his tenure.

In a nod to the ongoing World Cup, activists donning referee outfits and red cards called on Macron to stop threatening to launch a trade dispute <https://www.commondreams.org/news/2022/08/12/wto-threats-against-us-electric-vehicle-tax-credit-prompt-calls-climate-peace-clause> against domestic electric vehicle manufacturing incentives, renewable energy tax credits, and other green provisions in the Inflation Reduction Act (IRA) passed earlier this year by the U.S. Congress.

"Macron claims France is a climate leader, but his vocal critique of the Inflation Reduction Act's climate measures deserves a penalty for hypocrisy," Public Citizen's Global Trade Watch tweeted.

Melinda St. Louis, the group's director, added: "Activists braved the cold to issue the 'red card' for Macron's threats to U.S. climate law on behalf of European business interests.

"President Macron clearly cares about climate change, so he and other European leaders should drop all the complaints about the IRA and threats to launch a trade challenge against it," St. Louis said <https://www.citizen.org/news/photos-protestors-at-white-house-dinner-urge-macron-to-stop-threatening-u-s-climate-action/> in a statement. "Governments should be empowered to fight climate change and support the clean energy transition without fear of being undermined by antiquated trade rules."

As Politico reported <https://www.politico.com/news/2022/12/01/biden-macron-united-front-meeting-00071590>, Macron has "bristled against tax incentives for clean energy included in the Inflation Reduction Act—a move that European leaders fear could cause sectors of their own economies to shift operations to the United States."

According to the news outlet: "On Thursday, Biden made 'no apologies' for the legislation but acknowledged 'glitches' in the bill, declaring the U.S. 'never intended to exclude' allies who were cooperating with Washington. He also suggested there were 'tweaks we can make' to satisfy allies."

The rally outside the White House comes as progressive advocacy groups escalate their demands to prioritize climate action over corporate-friendly trade rules ahead of next week's U.S.-E.U. Trade and Technology Council (TTC) talks in Maryland.

In an analysis <https://tradejusticeedfund.org/new-analysis-shows-how-a-climate-peace-clause-could-end-increasing-trade-attacks-on-green-jobs-initiatives-other-climate-measures/> published Thursday, the Trade Justice Education Fund and the Sierra Club made the case for the urgent adoption of a "climate peace clause," which they defined as a "commitment from governments to refrain from using dispute settlement mechanisms in international trade agreements to challenge other countries' climate mitigation and/or clean energy transition measures."

"In the face of increasing use of trade pacts to challenge climate policies," the groups explained, "a climate peace clause would help governments safeguard existing climate mitigation and transition measures by protecting them from trade challenges and incentivize and offer countries time to work together and resolve conflicts between trade agreements and the imperative for climate action."

 <https://twitter.com/TradeJusticeEd/statuses/1598289763337121794>
Hebah Kassam, director of the Sierra Club's Living Economy program, noted that the world "is not on track to reduce emissions at the scale needed to avoid irreversible damage to communities and ecosystems."

"Governments must have and use every tool in the toolbox to ratchet up climate ambition, and we simply do not have time for governments to continue using outdated trade agreements to attack and undermine climate action," said Kassam. "We are calling on the U.S. to propose a climate peace clause in the TTC negotiations to end trade attacks on climate policies such as initiatives to create green jobs and healthier communities."

According to Trade Justice Education Fund executive director Arthur Stamoulis, "Language similar to a climate peace clause had been included in TTC text leaked earlier this year, but was later reported to have been removed."

"As two trusted trading partners committed to tackling climate change, a climate peace clause is a commonsense step the U.S. and E.U. can take right now to show leadership both on trade and on climate," said Stamoulis. "We urge the U.S. to make good on its promise to create a worker- and climate-friendly model of trade and to propose and adopt a climate peace clause in the TTC."

Also on Thursday, the Transatlantic Consumer Dialogue, which represents more than 70 consumer advocacy organizations on both sides of the Atlantic, released a statement <https://tacd.org/wp-content/uploads/2022/12/20221201-TACD-demands-ahead-of-TTC-ministerial-Dec-2022.pdf> that said, in part, "If the U.S. and E.U. are serious about making trade more sustainable, they must first ensure that trade challenges do not undermine domestic climate policies needed to support the green transition of our economies."

The coalition called on the European Union and Washington to "find a solution to avoid a trade dispute around the U.S. Inflation Reduction Act that would weaken the new climate policy."

North American production requirements were key to securing the political support needed to pass the IRA, but as the Trade Justice Education Fund and the Sierra Club's new research details, progress on creating green jobs and slashing planet-heating pollution remains at risk of being derailed <https://www.commondreams.org/news/2022/06/21/young-europeans-sue-stop-treaty-fossil-fuel-giants-use-foil-climate-action> by Investor-State Dispute Settlement complaints and other objections lodged at neoliberal trade institutions.

To take just two examples of recent World Trade Organization (WTO) state-to-state cases mentioned in the paper, the U.S. successfully challenged India's program subsidizing local solar production in 2017. Two years later, India successfully challenged clean energy programs in eight U.S. states that included "buy-local" rules.

The Trade Justice Education Fund, the Sierra Club, and Public Citizen held a webinar <https://www.citizen.org/article/webinar-stopping-trade-attacks-on-climate-policies/> last month documenting how corporate-managed trade agreements are impeding climate action. Recent actions follow a May letter <https://tradejusticeedfund.org/150-environmental-groups-urge-inclusion-of-climate-peace-clause-in-trade-agreements/> in which more than 150 U.S.-based organizations urged the Biden administration to support a climate peace clause.

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