WTO MC12 Deliverables on Trade and Environmental Sustainability Discussed

WTO members taking part in a new initiative on trade and environmental sustainability continued their discussions on possible outcomes to be agreed at the WTO’s upcoming 12th Ministerial Conference (MC12) during the second meeting of the Trade and Environmental Sustainability Structured Discussions (TESSD) on 26-28 May. The first two days of the meeting were dedicated to exchanges with representatives from civil society groups, international organizations, the business community and academic institutions on a variety of topics that may form part of the future TESSD work programme.

Launched last November, the TESSD discussions are intended to complement the existing work of the Committee on Trade and Environment and other relevant WTO committees and bodies. The initiative seeks to promote transparency and information sharing, identifying areas for future work within the WTO, support technical assistance and capacity building needs, particularly for least-developed countries, and work on deliverables for environmental sustainability in the various areas of the WTO.

The initiative, co-sponsored by 53 WTO members, is open to all WTO members. The first TESSD meeting took place on 5 March.

The second TESSD meeting kicked off with presentations on issues related to environmental goods and services, followed by open discussions among the participants. This was followed on the second day by presentations and open discussions on the issues of green aid for trade; fossil fuel subsidy reform; trade-related climate measures, including border carbon adjustments; and greening trade (with a focus on the circular economy) and priorities for developing countries.

Geneva-based trade officials as well as senior capital-based experts took part in the exchanges, along with representatives from international organizations such as the United Nations Environment Programme, the UN Conference on Trade and Development, the UN Industrial Development Organization, the Organisation for Economic Cooperation and Development, the International Trade Centre, as well as the WTO Secretariat.

Also participating were representatives from the International Chamber of Commerce, the International Institute for Sustainable Development, CUTS International, the Graduate Institute of International and Development Studies, and others.

Ambassador Gloria Abraham Peralta of Costa Rica and Ambassador Stephen de Boer of Canada, who are coordinating the TESSD initiative, opened and closed the two days of discussions. Ambassador de Boer concluded by calling on all participants for their support and engagement in order to make further progress in the discussions.

In the WTO member-only session which followed on 28 May, participants focused much of their discussions on possible deliverables for MC12, which will take place from 30 November to 3 December. Several members supported the idea of a ministerial statement highlighting the potential contribution of the WTO to achieving global environmental and climate goals. Several members proposed that the ministerial statement contain a roadmap or plan of action for the post-MC12 period, possibly comprising the liberalization of trade in environmental goods and services, fossil fuel subsidy reform, the transition to a circular economy, plastics pollution and sustainable supply chains, among other possible areas of work.

Some members cited the possible creation of a forum to discuss ways to avoid “carbon leakage” — firms moving production (and related emissions) to countries with laxer emissions constraints — and related tools such as border carbon adjustments as an additional possible MC12 deliverable. Several members stressed that TESSD work should be consistent with the WTO and international climate agreements, and measures to tackle climate change should not be unjustifiably discriminatory or protectionist.

During the meeting, Brazil, Ecuador, El Salvador and Paraguay introduced a written proposal highlighting the key role of the agricultural sector in achieving sustainable development and calling on TESSD participants to look at the environmental impacts of agricultural subsidies, along with the role of environment-related standards and regulations on agricultural trade.

Many members who took the floor also emphasized the importance of ensuring the special needs and concerns of developing and least-developed countries are taken into account and maintaining openness and transparency in the TESSD's work to ensure broad-based participation in the discussions.

The next meeting of the TESSD is scheduled for the week of 26 July 2021.