Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/57625 
Year of Publication: 
2011
Series/Report no.: 
WTO Staff Working Paper No. ERSD-2011-01
Publisher: 
World Trade Organization (WTO), Geneva
Abstract: 
As governments increasingly adopt policies to reduce greenhouse gas emissions, concern has grown on two fronts. First, carbon leakage can occur when mitigation policies are not the same across countries and producers seek to locate in jurisdictions where production costs are least affected by emission constraints. The risk of carbon leakage raises questions about the efficacy of climate change policies in a global sense. Secondly, it is precisely the cost-related consequences of differential mitigation policies that feed industry concerns about competitiveness. We thus have a link between environmental and competitiveness perspectives that fuses climate change and trade regimes in potentially problematic ways as governments contemplate trade actions to manage the environmental and/or competitiveness consequences of differential climate change policies. On the trade side of this relationship, we have the reality that the GATT/WTO rules were not originally drafted to accommodate climate change policies and concerns. The purpose of this paper is to analyze the relevance of certain WTO rules to the interface between climate change and trade, focusing in particular on border measures, technical regulations on trade, standards and labelling, and subsidies and countervailing duties. It concludes that in the absence of clear international understandings on how to manage the climate change and trade interface, we run the risk of a clash that compromises the effectiveness of climate change policies as well as the potential gains from specialization through trade.
Subjects: 
border adjustments
carbon leakage
climate change
competitiveness
GATT/WTO
standards
trade
JEL: 
F13
F18
K33
Q54
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

Files in This Item:
File
Size
471.83 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.