Climate change major threat to future growth, prosperity: WTO

WTO’s flagship publication was released yesterday at the 27th United Nations Climate Change Conference (COP27) in Sharm el-Sheikh, Egypt.

“The report argues that trade is a force for good for climate and part of the solution for achieving a low-carbon, resilient and just transition,” WTO director general Ngozi Okonjo-Iweala, who is participating in the climate summit, said in her foreword to the report.

Without significant reductions in global greenhouse gas (GHG) emissions, many countries are likely to find their comparative advantages changing, with agriculture, tourism and some manufacturing sectors particularly vulnerable to climate impacts, the report said.

Trade can reduce costs of technologies and critical goods and services. In the longer-run, open international markets would help countries achieve necessary economic adjustment and resource reallocation. This is particularly relevant for the most vulnerable economies—least-developed countries, small-island developing states and landlocked developing countries, it noted.

Trade can reduce the cost of mitigating climate change—by supporting the reduction or prevention of GHG emissions—and speed up the transition to a low-carbon economy and the creation of green jobs.

WTO simulations presented in the report suggest that eliminating tariffs and reducing non-tariff measures on a subset of energy-related environmental goods could boost exports by 5 per cent by 2030, while the resulting increases in energy efficiency and renewable uptake would reduce global emissions by 0.6 per cent, a WTO press release said.

The report also emphasises that international cooperation on trade-related aspects of climate policy is vital for making climate actions more effective, and the low-carbon transition more just, minimising trade frictions and investor uncertainty.

Without global cooperation on ambitious climate policies, the world will not achieve the Paris Agreement's goal of limiting the global temperature rise to well below 2 degrees Celsius, the report added.

Fibre2Fashion News Desk (DS)