Trade and SDG 13 – Action on Climate Change | Asian Development Bank

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Trade and SDG 13 – Action on Climate Change

Publication | May 2017
Trade and SDG 13 – Action on Climate Change

Climate change policies do not operate in isolation. Other policy areas such as trade can influence whether climate objectives are achieved.

We assess the interaction of international trade with climate policies, and the influence of trade on the implementation of Sustainable Development Goal (SDG) 13 on climate change. Although international trade contributes directly to greenhouse gas (GHG) emissions, increased trade can help to achieve development goals in a GHG-efficient manner, provided that GHG emissions are correctly priced everywhere. Given that emissions are not universally priced, we examine where policies related to trade may be misaligned with or otherwise hindering climate change objectives. While concluding that the multilateral agreements of the World Trade Organization do not prevent governments from pursuing strong domestic climate policy, we identify potential misalignments. These include import tariffs on environmental goods, barriers to trade in services, and domestic policies designed to support local low-carbon industry but which are restrictive of international trade and therefore potentially counter-productive. We conclude by stressing the importance of building resilience in the global trade system in the face of increasingly frequent and severe weather-related shocks.

WORKING PAPER NO: 735