The Multilateral Link – UNFCCC and Doha

Today I’ll continue my big-picture look on trade & climate change by studying some of the challenges facing the multilateral negotiations on climate and how they relate to the multilateral negotiations on trade. 

With a huge amount of political investment in both the Doha Round and the UNFCCC
negotiations, what are some of the important sequencing and overlap issues in these two sets of negotiations? In the event of a shifting policy focus by members due to failing progress in the multilateral negotiations, would the sequencing of such events in the WTO vis-à-vis UNFCCC frames affect each other?

It is of course important to remember that these negotiations are completely different in
many respects. The WTO negotiations are very topical and constitute a very intentional effort to liberalize trade, for example with agricultural trade and NAMAs. Climate change
multilateralism is a different beast as it deals, at its core, with placing necessary restraints
upon the current forms of human economic activity. The two negotiations are both hugely
complex multilateral undertakings, but clearly with qualitative differences in their character.

Despite this difference, multilateral action on trade can be very important for
multilateral action on climate change and it is difficult to think that there will be some kind of sustainable multilateral action on climate change without some kind of multilateral goodwill action on trade in some form.

One should probably be careful here not to make an assumption of specific trade issues
ever being definitively ‘solved’ within the UNFCCC framework. From a multilateral
perspective, this will almost surely happen in the WTO if it happens since tackling trade
issues is generally seen as a purview of the WTO in the UNFCCC negotiations.

In this way, the focus and force of policy resulting from the UNFCCC framework can
be significant for the WTO as a signal to start negotiating on some contentious issues such as border carbon measures. The important point of sequencing is that a clear signal has to come from the UNFCCC first for anything like that to happen, productively, in the WTO.

Before any meaningful agreements in the UNFCCC have been made, it would be a strangely premature and unlikely action, particularly in the light of an unfinished Doha, to start negotiating on this in the WTO. Even without the leviathan that is Doha looming over the organization, which may or may not make such a task harder, there is clearly a desirable sequencing to such a development where it would seem the horse of climate change agreement must come before the cart of allowable climate trade measures negotiated in the WTO. However, as a matter of sequence, there is slim chance at the moment of writing that the UNFCCC negotiations anytime soon will progress sufficiently far as to send such clear signals about where the WTO needs to ‘get busy’ on creating allowable specifics regarding domestic and international climate change action. Be that as it may, my opinion is that the WTO cannot, and should not, take the lead on this, since they are unlikely to be able to do so constructively while lacking UNFCCC progress. I’ll be exploring the implications of this a bit more in coming posts.

A goodwill agreement of some sort in the WTO is the aftermath of the real climate battle, which is appropriately to take place, at least multilaterally, in the UNFCCC negotiations. In other words, when one looks at the role of the WTO in this sequencing, they do have a very important part to play in creating a situation down the line where trade law does not stand in the way of performing on agreements made on climate change. But the appropriate sequencing of creating such a situation would suggest that one should not mislabel the role of the WTO with regards to climate change or lament inaction as they are wont to appropriately follow, not lead, in this area. For full disclosure, It’s very important to note that not everyone agrees with me on this and think that WTO could have fruitful and productive discussions on things like PPM:s and border carbon measures without any agreement whatsoever in the UNFCCC. I disagree, but that’s my opinion.

Seen from this “horse before the cart” perspective, the only blocking potential of the Doha with regards to trade and climate synchronization would be if it in some way lingered on for an extremely long time and consumed so much resources that even despite clear signals on specific areas being sent from highly successful UNFCCC negotiations, the organizational capacity of the WTO were to be overstretched to the point of preventing such aftermath negotiations. Needless to say, we are a very long way from such a situation and it does not seem likely that it would ever arise.

Some separation of concepts is also valid to insert here when talking about sequencing
of action and the role of the WTO with regard to climate change. It is important not to
confuse the institutional role and function of the WTO with the motivations and fears of some nations on the climate side of negotiations. Climate change mitigation occurs domestically. When countries in climate negotiations are eager to look at trade implications to motivate non-action, it usually says very little about the WTO as such and very much about how serious and willing these countries actually are about confronting climate change. It is to be resisted to ever judge trade and the WTO as an external reason for why domestic action is impossible. This type of false scapegoating unfortunately still surfaces from time to time as it provides a convenient ‘out there’ reason taken to imply a lessening of responsibility by providing a “boogey-man” to blame all ills on.

Ultimately, it is unfortunate that there is still such a hard divide between trade and climate issues and their respective multilateral undertakings, as this separation does not really speak to how these issues are thought of in reality. Trade & climate change forms a single entity in how it needs to be tackled and should ideally be treated as such. But we do not have the luxury of ideal world governance, so we do the best with what we’ve got.

I’ll continue tomorrow with the impact all these things might have on WTO dispute settlement.


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