In order to combat climate change, the World Trade Organization advised nations to remove trade restrictions on environmental goods and services.
The WTO states in its yearly World Trade Report that the fight against climate change should not be pitched against international trade.
The report was released as world leaders gathered in Sharm el-Sheikh, Egypt, for the COP27 United Nations Climate Change Conference, which began on Sunday and runs through November 18.
The WTO argued that it was unrealistic to believe that commerce served only as a source of greenhouse gas emissions and pointed out that it could also help green inventions and technology expand.
Ngozi Okonjo-Iweala, director-general of the WTO, stated in the report’s introduction that trade is a force for good for the environment and a component of the solutions for achieving a low-carbon, resilient, and just transition.
The former Nigerian finance and foreign minister stated, “The WTO forecasts that cutting tariffs and non-tariff restrictions on energy-related environmental commodities might raise total exports of these products by five percent by 2030 and, at the same time, lead to a net decrease in carbon emissions.”
The experts at the international trade organization estimate that as a result of increasing use of renewable energy sources and improvements in energy efficiency, net carbon emissions could be decreased by 0.6 percent.
Despite being, on average, lower than those on other items, tariffs on environmental goods are nevertheless very high in low-income nations, according to the analysis.
Trade and trade policies may speed up the diffusion of cutting-edge technology and best practices, improve incentives for further innovation, and create the employment of the future while still generating emissions from production and transportation, according to Okonjo-Iweala.
She cited how the price of solar panels had drastically decreased over the last three decades as evidence that commerce had already played a significant part in the global climate response.
According to the head of the WTO, “around 40% of the cost drop has been attributable to scale economies made possible, in part, by global commerce and value chains.”
More could be accomplished by expanding trade in environmental goods and services.