Publication: Report

Greening International Trade

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Greening International Trade serves as a non-technical entry point for actors keen to navigate the environment-trade policy conversation and support more sustainable trade. It maps the current state of play and identifies a range of possible pathways forward.

Greening International Trade argues that advancing green trade requires a reframing of the environment and trade narrative around a forward-looking Environment and Trade 2.0 agenda that:

  • Safeguards and strengthens ambitious environmental policies nationally and internationally
  • Harnesses trade and trade policy to incentivize and drive green economic transformation
  • Reduces negative environmental impacts of international trade and trade policies
  • Supports environmentally sustainable, resilient, and fair international supply chains
  • Addresses the sustainable development priorities of developing countries and supports a just transition
  • Strengthens alignment of national trade policymaking with environmental goals and sustainable development priorities
  • Supports democratic, transparent, and accountable processes of trade policymaking.

Making this agenda a reality requires a four-pronged strategy.

First, greening trade must start with strong environmental laws, regulations, institutions, and enforcement nationally, complemented by international environmental agreements that set out shared goals, targets, and obligations, including minimum standards and trade measures where relevant.

Second, in terms of trade policies and agreements, governments can green trade through a strategic approach to measures and tariffs applied at their borders. Governments can also update trade rules and policies relevant to environmental action ‘behind the border.’ In addition to bolstered environmental and sustainable development chapters in trade agreements, this requires work to ensure the core provisions and commitments defined in trade agreements support environmental goals and incentivize sustainable production and consumption. In each of these areas, this paper highlights the importance of consultation with trading partners, transparency, fairness, and approaches that respond to the wider sustainable development priorities of developing countries.

Third, looking beyond trade rules, this paper highlights a range of additional pathways to stronger intergovernmental cooperation on green trade that require attention, such as development assistance for greening trade (green Aid for Trade), green trade finance, improved monitoring, green trade classifications and sustainability impact assessments.

Fourth, this paper highlights the opportunities presented by stakeholder initiatives to green trade and supply chains, along with a number of challenges, and identifies how trade policy frameworks could support and complement these.

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