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Policy briefTrends in inclusion of environmental related provisions linked to the agriculture, fisheries and forestry sectors in regional trade agreements 2023Agriculture, fisheries and forestry are closely linked to the environment and depend on it for their long-term productivity and sustainability. However, if not properly managed, these three sectors can have a negative impact on the environment. Agricultural trade can also have an impact on the environment, and in recent years there has been a renewed focus on how to balance sustainable development and trade liberalization. Since the establishment of the World Trade Organization (WTO), regional trade agreements (RTAs) have become a common option to liberalize trade and have grown significantly. RTAs have also expanded rapidly in terms of regulatory coverage, making direct reference to sustainable development and including provisions linking the environment to the agriculture, fisheries and forestry sectors. While the trend in the inclusion of environmental provisions related to agriculture, fisheries and forestry (or " Ag-ERPs") in RTAs has fluctuated somewhat since 1995, the average number of such provisions per agreement has increased steadily. This policy brief discusses the relationship between the agriculture, forestry and fisheries sectors, trade and the environment; presents the relevance of environment-related provisions in RTAs; assesses the evolution of Ag-ERPs in RTAs since 1995; shows the role of Ag-ERPs in mitigating the environmental impacts of trade-induced production growth; and introduces the discussion on whether the inclusion of Ag-ERPs in RTAs is the appropriate means to improve and extend the reach of different environmental practices globally.
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Book (stand-alone)Environmental outcomes in agriculture: the effects of environment-related provisions in regional trade agreements 2024
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No results found.The agriculture sector is both a contributor to global greenhouse gas (GHG) emissions and is affected by trade policies. As more and more regional trade agreements (RTAs) include environment-related provisions (ERPs), this technical note explores whether agriculture-related ERPs in RTAs are associated with reduced GHG emissions from agriculture. The research applies a novel dataset on ERPs related to the agriculture, forestry and fishery sectors (Ag-ERPs) to analyse this relationship in a panel of 195 countries and territories in RTAs notified to the World Trade Organization from 1995 to 2019. The findings show that there is indeed a significant reduction in agriculture-related GHG emissions in countries that enter into RTAs with more Ag-ERPs with their relevant trading partners in agricultural products. A mediation analysis reveals that this association is partly driven by stricter domestic environmental regulation, and partly by a reduction in agricultural land use. However, a large part of the overall association between RTAs with more Ag-ERPs and the reduction in agriculture-related emissions is still unexplained by these two channels. This suggests that lower GHG emission production methods are implemented at given levels of domestic environmental regulation and agricultural land use in countries with more Ag-ERPs in their relevant RTAs. -
Book (stand-alone)Border and related measures in the context of adaptation and mitigation to climate change
The State of Agricultural Commodity Markets (SOCO): Background paper
2018Also available in:
No results found.Although international trade is not specifically mentioned in the Paris Climate Agreement, trade can play a facilitating role in achieving the mitigation and adaptation objectives of signatories to the Agreement. Trade policies can also undermine those objectives. The focus of this paper is on examining how the facilitating role of trade can be achieved. One of the challenges created by the ‘bottom-up’ approach of self-declared national mitigation targets adopted in the Agreement is that if the economic costs of greenhouse gas (GHG) emissions are internalized in production and consumption, the implicit price of carbon will differ across countries. This creates the potential for trade distortions. Domestic mitigation policies in importers will almost inevitably result in some carbon leakage, i.e. offsets to reductions in domestic emissions through additional emissions generated in supplying imports. But an important distinction needs to be made between carbon reallocation and carbon misallocation resulting from changes in trade volumes. In the reallocation case, trade leads to a shift in production to lower-emitting producers thereby contributing to global mitigation. In the misallocation case, the opposite occurs. This paper analyses how various border measures, including border tax adjustments (BTAs) might be used to reduce potential carbon misallocation. The conclusion is that technical and legal constraints on the effective application of border measures for food and agricultural products to prevent carbon misallocation are extremely challenging and their use could open the door to protectionism. The use of carbon standards and labelling offers an alternative approach to reducing misallocation and promoting reallocation. It poses fewer technical difficulties and reduces the potential for legal challenges. An added advantage of labelling is that it can help to promote changes in consumption that will be needed to reduce the carbon footprint of food and agriculture. The use of the approach could be facilitated through the adoption of international standards for carbon measurement and labelling, such as those being developed through the International Organization for Standardization (ISO). Labelling is not a panacea and may have limited effectiveness when consumers base their consumption decisions primarily on the basis of price. For this reason, the use of domestic policy measures that increase carbon efficiency in agriculture (reduce emissions per unit of output) and limit changes in land use that contribute to emissions will also be important for achieving mitigation aims under the Paris Agreement. An increasing number of regional trade agreements (RTAs) have incorporated environmental provisions, with the most common types of provisions focusing on environmental cooperation. Recent agreements recognise the importance of mutually supportive trade and environmental policies, and national commitments to multinational environmental agreements. RTAs could play a supporting role to the Paris Climate Agreement, by fostering international cooperation on climate mitigation measures in the context of freer trade.
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