Global Governance Centre
03 May 2021

Greening International Trade: Pathways Forward

The Global Governance Centre is pleased to announce the publication of Greening International Trade: Pathways Forward, by Senior Researcher, Carolyn Deere Birkbeck.

Discussions of environment-trade issues are notoriously complex, cluttered with legalistic and technical language, and frequently opaque. As such, environmental stakeholders require information and tools to effectively engage in the trade policy arena. Stakeholders keen to promote green trade face common questions about priorities and strategy, including: 

  • What updates in the content, implementation and interpretation of trade rules could support green trade? 

  • Beyond improved trade rules, what other pathways and opportunities could be used to foster cooperation and action on green trade? 

  • How can trade policy better incentivize – and require – business to prioritize green products, production, and supply chains? 

  • How can the green trade agenda meet the needs of developing countries? 

  • How can international cooperation on trade support sustainable production in developing countries and address their sustainable development priorities? 

  • Where are the political opportunities and prospects for success greatest in 2021, and what kind of alliances would progress require? 

Greening International Trade serves as a non-technical entry point for actors keen to navigate the environment-trade policy conversation and promote sustainable trade. It maps the current state of play and identifies a range of possible pathways forward. 

Greening International Trade argues that advancing green trade requires a reframing of the environment and trade narrative around a forward-looking Environment and Trade 2.0 agenda that:

  • Safeguards and strengthens ambitious environmental policies nationally and internationally, 

  • Harnesses trade and trade policy to incentivize and drive green economic transformation, 

  • Reduces negative environmental impacts of international trade and trade policies, 

  • Supports environmentally sustainable, resilient, and fair international supply chains, 

  • Addresses sustainable development priorities of developing countries and supports a just transition, 

  • Strengthens alignment of national trade policymaking with environmental goals and sustainable development priorities, and 

  • Supports democratic, transparent, and accountable processes of trade policymaking. 

Making this agenda a reality requires a four-pronged strategy. 

First, greening trade must start with strong environmental laws, regulations, institutions, and enforcement nationally, complemented by international environmental agreements that set out shared goals, targets, and obligations, including minimum standards and trade measures where relevant. 

Second, in terms of trade policies and agreements, governments can green trade through a strategic approach to measures and tariffs applied at their borders. Governments can also update trade rules and policies relevant to environmental action ‘behind the border.’ In addition to bolstered environmental and sustainable development chapters in trade agreements, this requires work to ensure the core provisions and commitments defined in trade agreements support environmental goals and incentivize sustainable production and consumption. In each of these areas, the report highlights the importance of consultation with trading partners, transparency, fairness, and approaches that respond to the wider sustainable development priorities of developing countries.

Third, looking beyond trade rules, the report highlights a range of additional pathways to stronger intergovernmental cooperation on green trade that require attention, such as green Aid for Trade, green trade finance, improved monitoring, green trade classifications and sustainability impact assessments. 

Fourth, the report highlights the opportunities presented by stakeholder initiatives to green trade and supply chains, along with a number of challenges, and identifies how trade policy frameworks could support and complement these. 


Greening International Trade

This paper is the output of a project on greening international trade at the Global Governance Centre, the Forum on Trade, Environment & the SDGs (TESS) and Chatham House, the Royal Institute of International Affairs, funded by WWF-UK. This paper was produced in collaboration with the United Nations Environment Programme (UNEP) and the Trade, Development and Environment (TRADE) Hub, financed by the UK Research and Innovation (UKRI) Global Challenges Research Fund (GCRF).