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Domestic Climate Policies and the WTO

28 Pages Posted: 24 Mar 2004  

ZhongXiang Zhang

Tianjin University - College of Management and Economics

Lucas Assuncao

United Nations - Conference on Trade and Development (UNCTAD)

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Abstract

The Kyoto Protocol gives Annex 1 countries considerable flexibility in the choice of domestic policies to meet their emissions commitments. Possible climate policies include carbon/energy taxes, subsidies, energy efficiency standards, eco-labels, and government procurement policies. In order to meet their targets with minimum adverse effects on their economies, Annex 1 governments with differentiated legal and political systems are highly likely to pursue these policies that may have the potential to bring them into conflict with their WTO obligations. This paper explores the potential interaction between these domestic climate policies and WTO rules. It argues that their potential conflicts can be avoided or at least minimised if WTO rules are carefully scrutinised, and efforts are made early on to ensure that the proposed climate policies comply with them. It suggests an early process of pursuing consultations between WTO members and the Parties to the Climate Change Convention and points to the need of further exploring ways to enhance synergies between the trade and climate regimes.

Suggested Citation

Zhang, ZhongXiang and Assuncao, Lucas, Domestic Climate Policies and the WTO. The World Economy, Vol. 27, No. 3, pp. 359-386, March 2004. Available at SSRN: https://ssrn.com/abstract=514057

ZhongXiang Zhang (Contact Author)

Tianjin University - College of Management and Economics ( email )

92 Weijin Road
Nankai District
Tianjin, Tianjin 300072
China
+86 22 87370560 (Phone)

HOME PAGE: http://ideas.repec.org/f/pzh243.html

Lucas Assuncao

United Nations - Conference on Trade and Development (UNCTAD) ( email )

Palais des Nations
Office E 8074
Geneva, 1211
Switzerland

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