During the Copenhagen climate change conference in December, several delegations specifically raised the issue of border measures as a means of encouraging compliance with emissions targets, said the World Trade Organisation (WTO) after the conference ended, and added that this was an issue, which had not been thoroughly discussed in the WTO.
"During the conference the issue of border measures was raised. The WTO membership, like the United Nations members in Copenhagen, is divided on this matter," said WTO director-general Pascal Lamy.
The WTO said that if trade measures were to be considered as a means of combating climate change, a multilateral agreement on the conditions for use of such measures was essential, and could alleviate many of the concerns that were linked to trade.
The organisation noted that there were clear links between the WTO and environmental issues, and reiterated that global problems like climate change required global solutions.
"The more countries move toward a multilateral framework on border measures, the more unilateral measures will be difficult to justify," noted Lamy.
The 15th Conference of the Parties (COP15), which initially aimed at drawing up an ambitious legally-binding global climate change agreement, came to a close on December 18, having adopted only a political agreement called the ‘Copenhagen Accord'.
While many have criticised the accord as being weak, Lamy described the outcome of the Copenhagen conference as "a step forward".
"The Kyoto Protocol addresses about 30% of global carbon emissions. In contrast, the framework accord hammered out in Copenhagen may encompass the majority of world emissions. But much work remains to be done so that we can accelerate the pace of emissions reduction and make commitments taken in Copenhagen more binding," he added.
"Some have criticised the process of this meeting as cumbersome. But procedural difficulties are inevitable when leaders confront problems, which are global while remaining accountable largely to domestic politics. We are familiar with this in the WTO," he further stated.
Multilateral processes involve a great many actors and this makes reaching consensus complicated. But in the end, it is only through a multilateral process that we can achieve results, which are legitimate and credible, Lamy said.
The WTO also explained that, in the last decade, countries have designed new policies to address climate change. These ranged from standards to subsidies, from tradable permits to taxes. In doing so, governments have to find the right balance between designing a policy that would impose minimal costs for the economy, while effectively addressing climate change. The industrial sector's growing concern was to remain competitive while climate mitigation efforts proceed.
Many governments were considering the use of trade measures in the fight against climate change.
"Border measures are a hotly debated policy tool that may be applied to imported products based on their carbon footprint. The details of how that footprint would be calculated in an increasingly globalised market, where products are manufactured in a number of different countries, has itself been part of the debate," the organisation said.
The conclusion of a global climate change agreement that determines what each country must do to reduce emissions based on the environmental principle of "common but differentiated responsibility" could alleviate some of the concerns linked to trade.
As part of the Doha mandate, the WTO members agreed to negotiate greater market opening in environmental goods and services, the relationship between WTO rules and trade obligations set out in multilateral environmental agreements (MEAs) and on the exchange of information between those institutions.
The WTO added that agreement in these areas would help address climate change by outlining: a more open market for environmental goods and services; more coherence between trade and environment rules; better cooperation between the WTO and MEAs; and by reducing fisheries subsidies, which was also part of the Doha mandate.