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India, G77 Propose Text Against Trade Protection in Copenhagen Draft

 

South Bulletin (Issue 40): 10 September 2009 

The Copenhagen conference on climate change in December should make clear that developed countries shall not make use of climate change to introduce unilateral trade measures against goods and services imported from developing countries.

This demand was made by the G77 and China in Bonn in August, during a preparatory meeting for the Copenhagen conference under the UN Framework Convention on Climate Change (UNFCCC).

Trade protection in the name of climate change has become one of the most heatedly discussed issues in the climate talks. This was catalysed by the climate-related bill (known as the Waxman-Markey bill) passed by the US House of Representatives in June.

At the Bonn session (3-14 August 2009), India proposed explicit language to be included in the Copenhagen outcome, that developed countries shall not to resort to any form of unilateral measures against goods and services imported from developing countries on grounds of protecting the climate as such measures violate the provisions of the United Nations Framework Convention on Climate Change.

At the same session, the Group of 77 and China also called on developed countries not to adopt unilateral trade-restrictive measures against developing countries. The group said that if they adopt these trade measures, the developed countries would be passing on their mitigation burden onto developing countries, and this would contravene the principles and provisions of the Climate Change Convention.

The G77 and China stated that the measures would in particular be contravening the Convention’s principles of equity, common but differentiated responsibility and respective capabilities, and the principle enshrined in article 3.5 that the Parties should cooperate to promote a supportive and open international economic system that would lead to sustainable economic growth and development in all Parties, particularly developing country Parties.

[Article 3.5 also states that “Measures taken to combat climate change, including unilateral ones, should not constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on international trade”].

The G77 and China made these points on 13 August in a statement presented by Brazil at the sub group on “economic and social consequences of response measures”.

The G77 and China also proposed to establish a mechanism, such as a Forum, to identify and minimize the adverse economic consequences of response measures. It also provided the terms of reference of this mechanism.

The statement of G77 and China commented that developed countries are in the process of designing and implementing trade-distorting measures to combat climate change, such carbon border adjustment measures, carbon tariffs, carbon footprint labeling.

“These measures could have distortive effects on international trade, restrict the exports of developing countries and negatively affect the workers of those sectors that would have response measures, and therefore hinder the social and economic development of our countries,” said the group. “Developed country Parties should not adopt unilateral trade restrictive measures against developing countries in

contravention of the provisions of the UNFCCC.”

India had proposed that its text be incorporated into the mitigation section of the text that deals with response measures. However other countries including China, Singapore and Saudi Arabia also wanted the text to be in the section on “shared vision.”, which has more prominence.

The G77 and China statement presented to the sub-group also dealt with other matters. It said that “all developing countries will suffer economic and social consequences of response measures. Policies and measures to mitigate emissions should take into account the potential negative environmental, social and economic consequences of response measures on developing countries and consideration must be given to concrete remedies and effective actions to minimize any such consequences.”

It added: “There is a need for concrete action related to funding, and the transfer of technology for developing country parties, and to establish a mechanism, such as a Forum, to identify and minimize the adverse economic consequences of response measures as follows:

  • Identifying, quantifying and considering means to address the adverse impacts of measures taken to mitigate climate change on developing country Parties.
  • Providing support for the integration of economic diversification into sustainable development strategies and for facilitating efforts to achieve economic diversification in developing countries.
  • Encouraging direct investment, in particular through technology transfer from developed countries to assist and promote the economic diversification of developing countries.
  • Addressing the extent to which measures taken to mitigate climate change that constitute restrictions to trade raise concerns for developing country Parties with respect to their impact on social and economic development in developing countries.
  • Removing the barriers to effective technology transfer and of financial resources necessary to respond to mitigation measures.”

By Martin Khor and Hira Jhamtani

 

India’s Proposed Copenhagen Text Opposing Unilateral Trade Measures

At a meeting of the Ad Hoc Working Group on Long Term Cooperative Action (AWG-LCA) of the UNFCCC in Bonn on 12 August, India proposed the inclusion of the following paragraph for inclusion in the negotiating text for the Copenhagen conference:

"Developed country Parties shall not resort to any form of unilateral measures including countervailing border measures, against goods and services imported from developing countries on grounds of protection and stabilisation of climate. Such unilateral measures would violate the principles and provisions of the Convention, including, in particular, those related to the principle of common but differentiated responsibilities (Article 3, Paragraph 1); trade and climate change (Article 3 paragraph 5); and the relationship between mitigation actions of developing countries and provision of financial resources and technology by developed country Parties (Article 4, Paragraphs 3 and 7).”

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