Global free trade accord seen helping environment

GENEVA Fri Jun 26, 2009 10:46am EDT

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GENEVA (Reuters) - A new global free trade accord could help fight climate change by making clean-energy products more widely available, the World Trade Organization and United Nations Environment Program said on Friday.

Bucking conventional thinking about the climate hazards of shipping products by air, land and sea, the two agencies argued that a new Doha Round pact would do more good than harm.

Their joint study found that international trade rules have some wriggle room to permit countries to impose border taxes and tariffs to shield the environment, or to penalize goods made in areas with less-stringent climate restrictions.

"There is scope under WTO rules for addressing climate change at a national level," it said, with the caveat that the acceptability of measures "will very much depend on how these policies are designed and the specific conditions for implementing them."

Trade ministers from the United States, European Union, India, Brazil and elsewhere this week called for another push to conclude the Doha Round negotiations, which began in 2001 and have been largely stalled since last year.

An agreement on tearing down subsidies, tariffs and other commercial barriers is expected to bolster trade flows which have fallen sharply in line with the global economic slowdown.

While added shipments may lead to more pollution emitted from planes, trucks and boats, the WTO/UNEP report said freer trade would also make green technology more accessible to more consumers, effectively lightening the world's carbon footprint.

"A successful conclusion of WTO negotiations on opening markets to environmental goods and services will help improve access to climate-friendly goods and technologies," it said.

"Liberalization of trade in climate-friendly goods could provide incentives and domestic expertise for producers to expand the production and export of these goods," it added.

NEW TRADE PATTERNS

Many sectors of the global economy face threats from climate change, which scientists have linked to emissions of greenhouse gases from cars and factories reliant on carbon fuel.

Continued warming of the atmosphere is expected to alter weather patterns and cause sea level rises. This has serious implications for agriculture, forestry, fisheries and tourism, especially in developing nations, according to the two agencies.

World trade is nearly 32 times greater now than it was in 1950, and it has risen as a share of gross domestic product to 21 percent in 2007 from 5.5 percent in 1950, the report said.

Many developing countries rely on exports for their growth. Emerging economies now make up 34 percent of global merchandise trade -- double their share in the early 1960s.

The WTO/UNEP report said poorer nations will need help to protect their industries from global warming. This may entail assistance building dykes, sea walls, harbors and railways, and efforts to plant drought-resistant and other adaptive crops.

(Editing by Stephanie Nebehay and Jon Hemming)

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