Top News

Nations bicker in Bali over "green" goods trade

JIMBARAN, Indonesia (Reuters) - Rich and poor countries failed on Sunday to agree on a plan to open up trade in green goods, with Brazil fearing a major U.S.-EU proposal raised on the fringes of climate talks in Bali was a protectionist ruse.

Hundreds of environmental activists gather to form the shape of a globe in Kuta beach, Bali island December 9, 2007. REUTERS/Murdani Usman

At the end of two days of talks involving officials from 32 nations, including 12 trade ministers, a final news conference descended into farce as Brazil and the United States swapped recriminations.

The proposal involves cutting import tariffs on a list of 43 environmentally friendly goods, such as wind turbines and solar panels. If widely supported, it could lead to a global cut in greenhouse gas emissions blamed for climate change.

“What there’s no agreement on is the U.S.-EU proposal,” Brazil’s Minister of External Relations, Celso Luiz Nunes Amorim, told reporters.

“I think this list is incomplete. It won’t do much for climate change. It’s not proven what the effect it will have on climate change, maybe a little bit here and there,” Amorim said.

The trade officials were meeting for the first time on the sidelines of an annual U.N. climate conference, opening a new front in the global warming battle.

About 20 finance ministers will also meet on Indonesia’s resort island of Bali on Monday and Tuesday.

But the result from Saturday and Sunday’s talks was less than the United Nations and host Indonesia might have hoped.

Brazil was angry the proposal did not include biofuels. The country is the world’s top producer of ethanol and the government suspected the U.S.-EU measure’s real intention was to boost exports from rich nations.


“The protectionism is like the serpent’s head. The serpent will always try put its head up,” Amorim said earlier on Sunday.

Amorim and U.S. Trade Representative Susan Schwab later argued in front of the media over their respective positions about how to open markets in environmentally friendly goods, which the Doha round of global trade talks has been considering since 2001.

“The only single product whose effects on climate change is already demonstrated -- which is ethanol -- is not part of the list,” said Amorim.

He estimated ethanol use in Brazil had avoided 670 million tonnes of climate-warming carbon dioxide emissions in the past 30 years.

“We used a World Bank list because we didn’t want to appear to be self-serving,” Schwab told reporters.

“The U.S. is a net importer (of these 43 goods). What’s complicated about ethanol is it shows up in agricultural negotiations. Part of the confusion is where it shows up technically.”

She said the United States imported $18 billion of the goods, while exports totalled $15 billion. Developing countries including China, Mexico, Malaysia, Taiwan and Indonesia were all top exporters of the goods on the list, she said.

About 190 countries are meeting at a luxury Indonesian beach resort in Dec. 3-14 talks to try to launch negotiations on a broader climate change pact to succeed or replace the Kyoto Protocol from 2013. Kyoto only binds 36 industrialised countries to emissions curbs between 2008-2012.

World Trade Organisation chief Pascal Lamy said developing countries, such as Indonesia, Malaysia and Thailand, were leaders in some clean technologies and would benefit from free trade in environmental goods.

He also said trade rules could be tweaked to help curb the output of greenhouse gases, for example taking into account carbon taxes and subsidies, or minimum environmental standards.

Trade ministers in Bali also called for the urgent and successful conclusion of the Doha development agenda negotiations, including the trade in environmental goods.

“There has to be a new complementary package which would include how to facilitate technology transfer and adaptation for developing countries (through) capacity building and aid for trade,” said Indonesia’s Trade Minister Mari Elka Pangestu.