Draft WTO Agreement Shows Deep Divergences on Climate Change

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By Charles Kennedy – Feb 28, 2024, 10:30 AM CST

The World Trade Organization’s (WTO) ministerial conference in Abu Dhabi has shown again deep divergences regarding actions to tackle climate change, with the only explicit reference to “climate change” reduced to an annex in the latest drafts.  

Talks on a new WTO deal are being held this week in Abu Dhabi, and amid disagreements, negotiations on a final declaration continue.  

WTO Director-General Ngozi Okonjo-Iweala, who took office in 2021, is keen to include sustainability and tackling climate change in the WTO declaration from the ministerial conference.

But many countries disagree.  

The director general has proposed alternative language referencing climate change, with a proposed paragraph:

“We reaffirm the importance of the contribution that the multilateral trading system can make to addressing global environmental challenges, including climate change and related natural disasters, loss of biodiversity and pollution, and promoting the UN 2030 Agenda and its Sustainable Development Goals (SDGs) in its economic, social and environmental dimensions, insofar as they relate to WTO mandates and in a manner consistent with the Members’ respective needs and concerns at different levels of economic development.”

The proposed paragraph continues, “We recognise the ongoing efforts of the Committee on Trade and Environment (CTE), including hosting Thematic Sessions to allow Members to deepen discussions, including on the relationship between trade measures and environmental measures.”

However some major economies, including India, argue that trade agreements and WTO topics should be only about trade matters.

“WTO should not negotiate rules on non-trade related subjects like climate change, gender, labor etc. Rather they should be addressed in respective intergovernmental organisations,” Indian Commerce Minister Piyush Goyal said, as carried by Reuters. 

The most recent global summit on climate also showed divisions among fossil fuel producers and consumers. In the end, the COP28 climate summit, which ran one day into extra time amid heated debates on the future of fossil fuel use and production, ended with a compromise text referencing for the first time a call to all parties to transition away from fossil fuels. The final agreement was watered down compared to any references to phasing out or phasing down of fossil fuels, as objections from many oil exporting countries – led by Saudi Arabia – held back talks in the final days and sent the conference into overtime.   

By Charles Kennedy for Oilprice.com

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Charles Kennedy

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