02.04.2019
The recent Report “Trade in environmentally sound technologies: implications for developing countries”, prepared by the UNEP admits the significant potential of trade to contribute in implementing the Paris Agreement, the 2030 Agenda and achieving the SDGs.
Indeed, there is growing consensus that trade plays a crucial role in driving a shift towards more climate-resilient and more sustainable global economy, including by facilitating more efficient allocation of resources and bridging relative differences in resource endowments across countries. Specialization, competition, and innovation promoted by trade can drive down the costs of environmental goods and services and have positive effects on prosperity, jobs, and equality.
Trade can thereby contribute to economic development and diversification that increases living standards locally, can contribute to improving the environment. Furthermore, to the view of the authors of the report, trade can facilitate the creation and
expansion of markets for sustainable products and connect more businesses into global value chains (WTO and UNEP, 2018). According to the authors of the Report, trade in Environmentally Sound Technologies (ESTs) offers great opportunities for developing countries in terms of economic growth, export diversification, technological development, and environmental protection. Environmental services, in particular, provide opportunities for businesses in developing countries to integrate into global value chains, due to their localized nature. Trade in ESTs and the uptake of such technologies can further create sustainable jobs, especially in services related to the installation and maintenance of environmental products, systems, and infrastructure.
ESTs often also referred to as “clean” technologies are technologies that “protect the environment, are less polluting, use all resources in a more sustainable manner, recycle more of their wastes and products, and handle residual wastes in a more acceptable manner than the technologies for which they were substitutes” (Agenda 21) They are not just “individual technologies, but total systems which include know-how, procedures, goods and services, and equipment, as well as organisational and managerial procedures for promoting environmental sustainability” (UNCED, 1992)
In order to accelerate the development, deployment, and dissemination of such technologies, there is a need to create a supportive trade policy environment, liberalize trade in environmental goods and services, improve policy coherence both at national and global levels. The current crisis of multilateralism, rising levels of protectionism hinder the progress towards low-carbon, climate-resilient, and more sustainable economy. In order to advance climate action and promote sustainable development, countries increasingly rely on plurilateral and regional trade agreements. The Report admits the role of these instruments in advancing global climate and sustainable development agendas. The recent regional trade agreements cover a wide range of societal issues ranging from ‘best-endeavour’ provisions promoting overall environmental cooperation, investment, and innovation, to specific lists for liberalization of environmental goods. At the same time, The Report notes that these instruments represent a suboptimal policy option, compared to the multilateral approach. Global trade rules and negotiations can make big contributions to EST trade by providing a sound governance system. The Report makes a series of recommendations for improving global trade governance for ESTs.
