Date: 24 April 2008

Speaker: Thomas Brewer, Professor, Georgetown University, Associate Senior Fellow, CEPS

After the International Conference on Climate Change of last December in Bali, it is clear that climate change and international trade issues will have to confront with increasingly intersecting agendas, while there is a growing awareness for the need of a multilateral action in order to countervail the proliferation of agreements at more regional levels.

The aim of CEPS lunchtime meeting with Thomas Brewer, Associate Professor at the McDonough School Business at the Georgetown University and CEPS Associate Fellow, was to put the finger on the key-matters that are likely to characterize the international debate in the near future.

First of all, Brewer addressed to the tariff and non-tariff barriers to trade issues at the WTO. In particular, he commented on the EU-US proposal, presented in November 2007, to eliminate such tariffs to 43 environmental friendly goods, arguing that this list should be expanded in order to include other goods and services.

Secondly, he claimed, climate-related and trade-related issues can lead to conflicts in some specific sectors, such as aviation and shipping industries. In the United States, for example, the government refused to include aviation in the EU Emission Trading Scheme, while the government of California (supported by many NGOs) is trying to get ships and planes who would not reduce CO2 emissions banned from its ports; furthermore, the Norwegian government is developing an initiative that would lead to sectoral agreements in the post-2012 climate change context. Brewer also expressed some concerns on the fact that these sectors still remain outside trade and climate changing multilateral regimes.

Another important issues is represented by shift within the international technology transfer paradigm. Traditionally, this process have been characterized by unilateral flows from the northern hemisphere to the southern and poorer countries, with the financial support of the international financial institutions and of the official development assistance programmes. More recently, these transfers have been noticeably diversified, also thanks to the intensification of trade and FDI flows, and to the emergence of new key players in the international scene. Therefore, technological transfers are now characterized by a more horizontal and multilateral environment, in which the reduction of barriers to trade and investment in renewable energy goods and services could represent an important opportunity for developing countries, as provided in the Asia Pacific Partnership.

Finally, as far as offsetting border measures are concerned, Brewer observed that these measures are considered in the pending climate changing legislation in the US Senate, in fact, the Lieberman-Warner proposal would introduce a mandatory cap-and-trade system.