The World Trade Organisation (WTO) called for accelerated actions on climate change as climate change was a major threat to future growth and prosperity due to potential productivity losses, production shortages, damaged transport infrastructure and supply chain disruptions.
“Without significant reductions in global greenhouse gas (GHG) emissions, many countries are likely to find their comparative advantages changing, with agriculture, tourism and some manufacturing sectors particularly vulnerable to climate impacts,” the World Trade Report by WTO said.
The report also pointed out that trade is a force multiplier for countries’ adaptation efforts in the face of climate disruptions, reducing costs of technologies and critical goods and services.
The 2022 edition of the trade report, released at the ongoing COP27 meeting in Egypt, presented new analysis and recommendations on how international trade and greater cooperation can amplify global efforts to address climate change and put the planet on a sustainable trajectory.
“In the longer-run, open international markets would help countries achieve necessary economic adjustment and resource reallocation. This is particularly relevant for the most vulnerable economies – least-developed countries, small-island developing states and landlocked developing countries,” it said.
“This report is being launched at the same time as COP27. What I hope to see emerge there and elsewhere is a trade and investment facilitation pathway in support of a just transition to a low-carbon economy,” Director-General Ngozi Okonjo-Iweala, who is participating in the climate summit, said in her foreword to the report.
“The report argues that trade is a force for good for climate and part of the solution for achieving a low-carbon, resilient and just transition,” she said.
The Director-General is slated to present the report at a high-level event for world leaders at COP27 on Tuesday.
The report said trade could reduce the cost of mitigating climate change – by supporting the reduction or prevention of GHG emissions – and speed up the transition to a low-carbon economy and the creation of green jobs.
WTO simulations presented in the report suggest that eliminating tariffs and reducing non-tariff measures on a subset of energy-related environmental goods could boost exports by 5 percent by 2030, while the resulting increases in energy efficiency and renewable uptake would reduce global emissions by 0.6 percent.
The report pointed out that without global cooperation on ambitious climate policies, the world will not achieve the Paris Agreement’s goal of limiting the global temperature rise to well below 2 degrees Celsius.
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