Policy paper

Greening EU Trade 4:
How to “green” trade agreements?

“This paper provides recommendations on how to better align both the multilateral trading system and EU bilateral trade agreements with some key-environmental objectives.”

By Pascal Lamy, Geneviève Pons, Pierre Leturcq, 2020

At a time when the results of the US Presidential election allow for greater hope concerning environmental and trade agendas, this policy paper co-authored by Pascal Lamy, Geneviève Pons and Pierre Leturcq, offers diverse proposals on how to render trade agreements more environment friendly. It is the fourth in a series on the greening of EU trade policy that Europe Jacques Delors initiated following the political reconfiguration brought about by 2019’s European elections.

While trade policy is neither a panacea in the fight against global warming, nor a guarantor of environmental protection and biodiversity, it must nevertheless accompany domestic dynamics of ecological transition in order to ensure and further diffuse their impacts. Under the increasingly distinct pressure of public opinion on the matter, policy lines appear to be undergoing a swift transformation. The nomination of the new European Commission has brought about an acceleration in the agenda for greening EU trade policy. In the space of only a few months, highly sensitive issues such as border carbon adjustment or the inclusion of the Paris Agreement as an essential element of trade agreements have become policy options that are now part of the Green Deal agenda and as such seriously being considered at the European level.

This paper approaches this greening endeavor in the two traditional dimensions of the rules-based trading system: (i) the multilateral dimension, i.e. the WTO, where ambitions to open up trade fairly are limited by the heterogeneity of members preferences and by their different levels of development ; and (ii) the bilateral/regional dimension (“WTO +”), which allows for a greater pursuit of openness hence providing a lever for higher environmental ambitions.

The authors provide ideas and solutions to bolster mechanisms for the implementation and enforcement of multilateral environmental agreements (MEAs). They explore the role of multilateral trade agreements as well as of the WTO Appelate Body Jurisprudence in this field and provide recommendations on how to better align the multilateral trading system and EU bilateral agreements with some key-environmental objectives.

Climate change | Covid-19 | EUGreenDeal | Europe Jacques Delors | Greening trade | Trade