The Trade System and Climate Action: Ways Forward Under the Paris Agreement

58 Pages Posted: 5 Nov 2016

See all articles by Susanne Droege

Susanne Droege

Stiftung Wissenschaft und Politik

Harro van Asselt

Stockholm Environment Institute; University of Eastern Finland

Kasturi Das

India Habitat Centre - Research and Information System for Developing countries (RIS)

Michael A. Mehling

MIT Center for Energy and Environmental Policy Research (CEEPR)

Date Written: October 2016

Abstract

The relationship between trade policy and climate policy needs to improve in the future, in particular with a view towards implementing the Paris Agreement. With the aim of making trade policy supportive of climate action, this working paper discusses the relationship between the regimes established by the World Trade Organization (WTO) and the United Nations Framework Convention on Climate Change (UNFCCC), the provisions and pending disputes, the role of regional trade agreements as well as upcoming issues emerging from the Paris Agreement. It highlights several options for addressing the relationship between the two regimes from a legal, institutional and a policy perspective. The suggested options relate to those fields where national climate policy action has been taken during the last years and which are part of the intended nationally determined contributions (INDCs) submitted in the run-up to the Paris Agreement.

Already today, many regional trade agreements include climate and environmental provisions, and could thus help prevent a regulatory race to the bottom. Moreover, the increasing number of WTO disputes over national renewable energy policy regulations points to the case-by-case nature of WTO rule application on the one hand, and to a more systemic conflict of national approaches with the WTO obligation of non-discrimination on the other.

Keywords: trade and climate, WTO, Paris Agreement

JEL Classification: F18, Q27, Q54, Q58

Suggested Citation

Droege, Susanne and van Asselt, Harro and Das, Kasturi and Mehling, Michael A., The Trade System and Climate Action: Ways Forward Under the Paris Agreement (October 2016). Available at SSRN: https://ssrn.com/abstract=2864400 or http://dx.doi.org/10.2139/ssrn.2864400

Susanne Droege (Contact Author)

Stiftung Wissenschaft und Politik ( email )

10719 Berlin
Germany

Harro Van Asselt

Stockholm Environment Institute ( email )

Oxford
United Kingdom

University of Eastern Finland ( email )

PO Box 111
Joensuu, 80100
Finland

Kasturi Das

India Habitat Centre - Research and Information System for Developing countries (RIS) ( email )

Core 4B, 4th Floor, Lodhi Road
India Habitat Centre
New Delhi, Delhi 110003
India

Michael A. Mehling

MIT Center for Energy and Environmental Policy Research (CEEPR) ( email )

77 Massachusetts Avenue
50 Memorial Drive
Cambridge, MA 02139-4307
United States

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