UK needs trade policy changes to tackle climate crisis, experts warn

Posted on December 08, 2022
The oil factory near the sea releases white smoke through large pipes and produces electricity using wind generators.

A new report from the UK Climate and Trade Commission calls for Government-led change so that trade policy helps to deliver COP27 promises.

The UK Climate and Trade Commission was established by Queen Mary University of London and the Trade Justice Movement to help find policy solutions to the growing climate challenge – an area where the Government urgently needs new ideas, since the High Court ruled its current climate strategy unlawful. In a new report, the Commission calls on the UK Government to support climate action through its trade policies.

2022 has seen the impacts of climate change become increasingly and dramatically visible, breaking records with alarming frequency - from European heatwaves to Pakistan floods as well as prolonged drought in China, the Horn of Africa and the United States - while experts warn there is a short window to stop things from getting even worse.

Commissioners have pooled international cross-industry expertise to develop practical proposals for how the UK can better address climate change in the Free Trade Agreements (FTAs) it’s negotiating post-Brexit and make better use of existing trade rule flexibilities, capitalising on climate-friendly ‘quick wins’ as well as working with like-minded countries to lay the groundwork for lasting change at the United Nations Framework Convention on Climate Change (UNFCCC) and World Trade Organization (WTO).

Angus MacNeil MP, Chair of the International Trade Select Committee, hosted experts and policymakers in the House of Commons last night (Wednesday 14 December) to discuss the Commission’s newly published inaugural report ‘Towards a fair and strategic UK trade and climate policy’.

Commissioners urged the UK Government to focus on six core ways in which national and international trade policy could work to address climate change, rather than adding fuel to the fire of this environmental emergency:

  • Develop a trade strategy that clearly supports climate goals, and encourage others to have a stake by leading a national conversation about the purpose of trade and its relationship to climate change
  • Make urgent progress on ‘quick wins’, like phasing out fossil fuel subsidies and supporting WTO subsidy reform, leaving the Energy Charter Treaty and excluding Investor State Dispute Mechanisms from future trade and investment agreements
  • Reduce current over-reliance on FTAs and develop a more mature climate-friendly approach that uses a range of trade policy instruments to deliver agreed goals
  • Focus UK investment and development expertise on designing and delivering more pro-development trade and climate programmes, and invest in providing support for UK business
  • Establish a decision-making framework and guiding principles for situations where climate-related trade policies could affect developing country economies – such as the introduction of minimum environmental standards, due diligence requirements and carbon leakage measures
  • Champion approaches that involve multiple parties and consider the needs of developing countries, such as holding key trade discussions in the UNFCCC

Speaking ahead of the event, Angus MacNeil MP said: “This first report from the UK Climate and Trade Commission comes at a critical time, as we reflect on the outcomes of COP27 last month and the Government prepares to present updated climate plans to Parliament in the spring. We must ensure that trade policy supports rather than undermines action on climate change.”

Professor Liam Campling from Queen Mary University of London, who established the Commission in partnership with the Trade Justice Movement, commented: “Despite strong public support for action on climate change, there’s very little understanding of how trade and investment policies can help or hinder progress on this. We can’t tackle climate change without bringing trade into line, so it’s great to see the Commission’s new report making proposals that the UK Government could realistically implement to show leadership and vision in this neglected but vital area.”

Ruth Bergan, Director of the Trade Justice Movement, added: “Not nearly enough has been done and the window for keeping warming to 1.5 is closing fast. We need rapid and sustained climate action and the connection between trade and climate change has been overlooked for too long. The UK Government has a unique opportunity to chart a new course where fighting climate change is a central part of UK trade policy. We need them to champion an approach that is fair as well as effective in fighting climate change, and this new report gives them the direction they need.”

Read the report "Towards a fair and strategic trade and climate policy"