Tag Archives: Trade

Reformed trade rules can help to save the climate

If the British government agrees to reformed trade rules, that could help the crucial climate talks it will chair in November.

LONDON, 20 January, 2021 – This could be the year of opportunity for the United Kingdom – and far beyond it – in securing real action on tackling the climate crisis: reformed trade rules could provide a climate dividend of the rancorous Brexit process of leaving the European Union.

Success could earn the UK government an honoured place among the politicians visionary enough to confront probably the worst threat facing humankind. Failure would damn this generation of British leaders as a lightweight irrelevance.

Barely ten months from now, in November, the British government faces a massive challenge. In the Scottish city of Glasgow it will host and chair the annual United Nations climate conference, which must breathe new energy and hope into the global climate treaty, the Paris Agreement, adopted by 197 countries in the French capital in 2015.

Paris promised much but so far has delivered little in achieving the reductions in emissions of greenhouse gases the world urgently needs. Unless the Glasgow conference (COP-26 in UN jargon – the 26th Conference of the Parties) ends with iron-clad agreement that will inexorably ensure global average temperatures stay below 1.5°C, the planet faces dangerous and perhaps irreversible climate heating.

On the first day of 2021 the UK struck out on its own politically, leaving the EU after 47 years of membership to follow an independent route, not least on trade.

“We must shake up the economic model so that it doesn’t pay to destroy the environment”

Opponents of Brexit have dismissed the move as a risky gamble. Supporters say it gives the UK the alluring prospect of trade on British terms alone. Both agree in hoping the country may now enjoy more freedom and flexibility in trade policy.

Whether or not it does, campaigners argue, Brexit could open the way to a different but immensely important goal: it could be a game-changer in Glasgow.

They are pinning their hopes on the possibility that the UK will decide to join a new green trade grouping – ACCTS, the Agreement on Climate Change, Trade and Sustainability, formed by six countries committed to using trade policy to support action on the climate (New Zealand, Norway, Iceland, Costa Rica, Fiji and Switzerland).

If the UK does join ACCTS this year (it is an open agreement, which welcomes new members), that would send a clear message to the other members of the World Trade Organisation, its supporters believe, that post-Brexit Britain champions environmentally-sustainable trade and sees it as a potent way to strengthen action on the climate crisis.

Supporters of ACCTS say signatories are showing they back the reform of trade rules so as to give priority to the environment – a huge shift in emphasis for the global trading system. The Agreement has three main aims:

  • Liberalising trade in environmental goods and services: This means cutting tariffs on environmentally-friendly products (including, for example, wind turbines and solar panels) so they can be traded more freely and reach the countries where they are most needed, attracting investment and development. The UK already charges very low tariffs, so compliance will be simple
  • Eliminating fossil fuel subsidies: 89% of global carbon emissions come from fossil fuels and industry. Yet governments continue to subsidise coal, oil and gas, pouring US$500 billion (£367bn) of public money into their production and consumption every year. The UK currently offers an estimated £10bn (US$13.6bn) of public support to fossil fuels each year, in the form of direct subsidies and tax breaks. This runs counter to all the UK’s climate goals, which instead favour funding support for renewable energy
  • Developing eco-labels for goods: This aims to develop a common way of labelling goods with information about their environmental impact, to give consumers information on which to base their decisions.

‘Incoherence’

Speaking in Stockholm in March 2020 at an event to discuss climate change, trade, and sustainable development in the run-up to the Glasgow talks, Andrew Jenks, New Zealand’s ambassador to Sweden, said: “Fossil fuel subsidies are the height of policy incoherence on an issue where we cannot afford to carry on the mistakes of the past.”

From his diplomatic colleague the British ambassador, Judith Gough, there was if anything even more exuberant language for the potential offered by ACCTS: “We must shake up the economic model so that it doesn’t pay to destroy the environment”.

An active supporter of the ACCTS countries is the UK charity Traidcraft Exchange. It concludes a recent report, Getting in on the ACCTS, with these words: “In November 2020, the UK prime minister Boris Johnson announned a ten-point plan to ‘create, support and protect hundreds of thousands of green jobs, whilst making strides towards net zero [greenhouse gas emissions] by 2050.’

“Joining ACCTS would strengthen these commitments, and would send a clear message about how Britain plans to use its new independent trade policy.” There will be many listeners waiting intently in Glasgow to hear that message. – Climate News Network

If the British government agrees to reformed trade rules, that could help the crucial climate talks it will chair in November.

LONDON, 20 January, 2021 – This could be the year of opportunity for the United Kingdom – and far beyond it – in securing real action on tackling the climate crisis: reformed trade rules could provide a climate dividend of the rancorous Brexit process of leaving the European Union.

Success could earn the UK government an honoured place among the politicians visionary enough to confront probably the worst threat facing humankind. Failure would damn this generation of British leaders as a lightweight irrelevance.

Barely ten months from now, in November, the British government faces a massive challenge. In the Scottish city of Glasgow it will host and chair the annual United Nations climate conference, which must breathe new energy and hope into the global climate treaty, the Paris Agreement, adopted by 197 countries in the French capital in 2015.

Paris promised much but so far has delivered little in achieving the reductions in emissions of greenhouse gases the world urgently needs. Unless the Glasgow conference (COP-26 in UN jargon – the 26th Conference of the Parties) ends with iron-clad agreement that will inexorably ensure global average temperatures stay below 1.5°C, the planet faces dangerous and perhaps irreversible climate heating.

On the first day of 2021 the UK struck out on its own politically, leaving the EU after 47 years of membership to follow an independent route, not least on trade.

“We must shake up the economic model so that it doesn’t pay to destroy the environment”

Opponents of Brexit have dismissed the move as a risky gamble. Supporters say it gives the UK the alluring prospect of trade on British terms alone. Both agree in hoping the country may now enjoy more freedom and flexibility in trade policy.

Whether or not it does, campaigners argue, Brexit could open the way to a different but immensely important goal: it could be a game-changer in Glasgow.

They are pinning their hopes on the possibility that the UK will decide to join a new green trade grouping – ACCTS, the Agreement on Climate Change, Trade and Sustainability, formed by six countries committed to using trade policy to support action on the climate (New Zealand, Norway, Iceland, Costa Rica, Fiji and Switzerland).

If the UK does join ACCTS this year (it is an open agreement, which welcomes new members), that would send a clear message to the other members of the World Trade Organisation, its supporters believe, that post-Brexit Britain champions environmentally-sustainable trade and sees it as a potent way to strengthen action on the climate crisis.

Supporters of ACCTS say signatories are showing they back the reform of trade rules so as to give priority to the environment – a huge shift in emphasis for the global trading system. The Agreement has three main aims:

  • Liberalising trade in environmental goods and services: This means cutting tariffs on environmentally-friendly products (including, for example, wind turbines and solar panels) so they can be traded more freely and reach the countries where they are most needed, attracting investment and development. The UK already charges very low tariffs, so compliance will be simple
  • Eliminating fossil fuel subsidies: 89% of global carbon emissions come from fossil fuels and industry. Yet governments continue to subsidise coal, oil and gas, pouring US$500 billion (£367bn) of public money into their production and consumption every year. The UK currently offers an estimated £10bn (US$13.6bn) of public support to fossil fuels each year, in the form of direct subsidies and tax breaks. This runs counter to all the UK’s climate goals, which instead favour funding support for renewable energy
  • Developing eco-labels for goods: This aims to develop a common way of labelling goods with information about their environmental impact, to give consumers information on which to base their decisions.

‘Incoherence’

Speaking in Stockholm in March 2020 at an event to discuss climate change, trade, and sustainable development in the run-up to the Glasgow talks, Andrew Jenks, New Zealand’s ambassador to Sweden, said: “Fossil fuel subsidies are the height of policy incoherence on an issue where we cannot afford to carry on the mistakes of the past.”

From his diplomatic colleague the British ambassador, Judith Gough, there was if anything even more exuberant language for the potential offered by ACCTS: “We must shake up the economic model so that it doesn’t pay to destroy the environment”.

An active supporter of the ACCTS countries is the UK charity Traidcraft Exchange. It concludes a recent report, Getting in on the ACCTS, with these words: “In November 2020, the UK prime minister Boris Johnson announned a ten-point plan to ‘create, support and protect hundreds of thousands of green jobs, whilst making strides towards net zero [greenhouse gas emissions] by 2050.’

“Joining ACCTS would strengthen these commitments, and would send a clear message about how Britain plans to use its new independent trade policy.” There will be many listeners waiting intently in Glasgow to hear that message. – Climate News Network

How Beijing is shaping the Amazon

EMBARGOED until 0001 GMT on Thursday 21 February China has now replaced the US and Europe as Brazil’s main trading partner. a position which gives it significant influence over what happens in the Amazon forest – and over attempts to protect it. Climate News Network’s Brazil correspondent reports: SAO PAULO, 20 February – When I arrived in the Amazon in the 60s, there were no roads. The rivers were the highways, crowded with boats of all shapes and sizes. You travelled on what was available, be it a trading boat, stopping at riverside villages for fishermen to carry aboard giant pirarucu (one of the world’s largest freshwater fish, reaching up to two metres in length), or a precarious canoe powered by an outboard motor, getting soaked in sudden downpours. I slung my hammock in passenger boats and slept to the sound of the thump-thump-thump of the engines, or in cattle boats, kept awake by the restless shuffle of cows on the way to the slaughterhouse. Once I got a lift on a missionary boat which stopped at a lonely shack for a nervous young priest to give the last rites to a dying man. Occasionally we would be rocked in the wake of the big Booth Line steamers chugging their way a thousand miles upriver to Manaus after crossing the Atlantic from Liverpool. In the 70s the military, who had taken power, decided that the vast Amazon region must be “integrated” with the rest of the country, which had developed along the coast, to stop foreign powers occupying it to exploit its natural resources. They began building roads and moving in Brazilians from other regions to populate what they called an “empty” region, ignoring the existing population of indigenous peoples and descendants of the tappers who had migrated there during the turn of the century rubber boom.

Huge forest loss

Roads now link the Amazon region to the rest of the country, but ironically they have facilitated the penetration of foreign companies into every corner of the rainforest, as well as cattle ranchers, soy farmers, loggers and mineral companies from the more developed parts of Brazil.  Almost 20% of the rainforest has been destroyed since the roads came. The Amazon basin is now China’s No.1 supplier of natural resources, replacing its Asian neighbours as their resources have become depleted. In a relatively short time, China has become Brazil’s major trading partner, overtaking the US and Europe. But China’s voracious demand for iron ore and timber, as well as soy and beef, is not only fuelling deforestation but negatively influencing Brazil’s environmental protection laws, in the view of researchers. In a 2012 paper entitled Amazonian forest loss and the long reach of China’s Influence¹, the authors found that “the rapid rise in exports of soy and beef products to China are two of the major drivers of Amazonian deforestation in Brazil”. The paper further argues that Chinese purchases of agricultural and forest land and Chinese imports of commodities such as timber and aluminium also cause environmental impacts in the Amazon. Chinese financing and investment in Amazonian infrastructure such as railways and mineral processing facilities have additional impacts. The authors say the “direct impact of commodity exports is only the tip of the iceberg of Chinese influence on Amazonia.” “Money earned from this trade is strengthening Brazilian agribusiness interests, with profound effects on domestic politics that are reflected in legislative and administrative changes, weakening environmental protection”. This refers to the recent successful attempt by the agribusiness lobby in the Brazilian Congress to weaken the existing Forest Code, which, although often flouted, has still played an important role in conserving rainforest, rivers and biodiversity. “Impacts can also be expected from Chinese financing under negotiation for infrastructure such as a railway linking the state of Mato Grosso to a port on the Amazon river”, the authors write.

The_Amazon_-_Puente_Guillermo_Billinghurst3

A bridge too far – cutting through the Amazon Image: Robert Middleton

“Mato Grosso, an Amazonian state twice the size of the US state of California, is a major focus of expansion of soy, cotton and intensified cattle production. Chinese purchases of land for agriculture and timber imply an increasing direct role in commodity production. “Other impacts come from exports from mining and from the processing of minerals, especially the demands for charcoal for pig-iron smelters and for electricity from hydroelectric dams for aluminium smelters”. They say Chinese demand for aluminium, an electricity-intensive industry, “contributes to Brazil’s push for a massive increase in building hydroelectric dams in Amazonia over the next decade.” “Brazil’s 2011–2020 ten-year energy-expansion plan (Ministry of Mines and Energy, 2011) calls for 30 large dams to be built in the Legal Amazon [the greater Amazon basin] by 2020, a rate of one dam every four months. “The Chinese-Brazilian alumina plant will be an important beneficiary of the Belo Monte dam, now under construction on the Xingu River, with transmission lines planned to connect Barcarena (where the plant is located) directly to the dam near Altamira, Para.” Belo Monte has environmental and social impacts that extend far beyond the areas that will be directly flooded, and the dam is likely to justify much larger upstream reservoirs to regulate the river’s flow, according to an earlier study by Fearnside in 2006. He also concluded from other studies that “the dam has functioned as a ‘spearhead’ in creating precedents that weaken Brazil’s environmental licensing system and prepare the way for the many dams proposed under the energy-expansion plan”  and that “the influence of both Brazil and China in expanding carbon credit for hydroelectric projects under the Kyoto Protocol’s Clean Development Mechanism has further increased the profitability of dams”. “It should therefore not come as a surprise that China exerts multiple influences on events in Brazil, often to the detriment of the Amazon forest”, concludes the 2012 paper.

Exploit a cow, save a tree

  It notes that Brazil’s boom in agricultural commodities, which earned US$85 billion in 2011, has contributed hugely to the country’s recent economic growth and has reduced its vulnerability to external economic crises. Meanwhile a recent study produced by Imazon (Amazon Institute of People and The Environment), a well-respected research institute based in Belem, has shown that deforestation could be drastically reduced by increasing productivity. Traditionally, Amazon cattle farmers have never bothered about productivity, because it has been so easy just to clear more forest. The Imazon study shows that future projected demand could be entirely met without the need to cut down a single tree, if productivity was increased from the present average of 80 kilos of beef per hectare to 300 kilos. To help farmers learn the new techniques, Imazon suggests that an annual investment of about US$500 million would be enough to pay for technical assistance, reference centres for each region, and model farms to demonstrate good practice. Credit could then be linked to performance. Imazon points out that if nothing is done to increase productivity a further area of almost 13 million hectares will be cleared to meet demand, leading to an annual deforestation rate three to four times greater than the Government’s target of no more than 380,000 hectares a year until 2020. Traditionally the Government has relied on applying hefty fines for illegal clearing. This has two big disadvantages: the deforestation is detected only when it has already happened, and because of Brazil`s complex and lengthy judicial process, the fines are almost never paid. In addition, the powerful farmers` lobby in Congress is adept at voting through “amnesties” at regular intervals to pardon unpaid fines. Now a more intelligent way to inhibit deforestation has been found, this time by the Central Bank. A bank resolution, passed in 2008, compels farmers to prove they are in compliance with environmental laws before they can obtain credit from any official bank. A study by the Nucleus for the Evaluation of Climate Policies of Rio de Janeiro’s Catholic University, PUC, found that, as a result, between 2008 and 2011 a total of 2,700 sq kms was saved from deforestation, because the farmers, deprived of capital, lacked the funding to extend their activities. The study found the correlation between credit and deforestation was stronger in cattle raising. The Government recently celebrated new statistics showing a reduction in deforestation, but as these various studies show, there are many variables involved. If China maintains or increases its demand for the natural resources of the Amazon and for the commodities produced in surrounding areas, the threat to the rainforest will continue. – Climate News Network ¹Philip M. Fearnside, Adriano M. R. Figueiredo and Sandra C. M. Bonjour

EMBARGOED until 0001 GMT on Thursday 21 February China has now replaced the US and Europe as Brazil’s main trading partner. a position which gives it significant influence over what happens in the Amazon forest – and over attempts to protect it. Climate News Network’s Brazil correspondent reports: SAO PAULO, 20 February – When I arrived in the Amazon in the 60s, there were no roads. The rivers were the highways, crowded with boats of all shapes and sizes. You travelled on what was available, be it a trading boat, stopping at riverside villages for fishermen to carry aboard giant pirarucu (one of the world’s largest freshwater fish, reaching up to two metres in length), or a precarious canoe powered by an outboard motor, getting soaked in sudden downpours. I slung my hammock in passenger boats and slept to the sound of the thump-thump-thump of the engines, or in cattle boats, kept awake by the restless shuffle of cows on the way to the slaughterhouse. Once I got a lift on a missionary boat which stopped at a lonely shack for a nervous young priest to give the last rites to a dying man. Occasionally we would be rocked in the wake of the big Booth Line steamers chugging their way a thousand miles upriver to Manaus after crossing the Atlantic from Liverpool. In the 70s the military, who had taken power, decided that the vast Amazon region must be “integrated” with the rest of the country, which had developed along the coast, to stop foreign powers occupying it to exploit its natural resources. They began building roads and moving in Brazilians from other regions to populate what they called an “empty” region, ignoring the existing population of indigenous peoples and descendants of the tappers who had migrated there during the turn of the century rubber boom.

Huge forest loss

Roads now link the Amazon region to the rest of the country, but ironically they have facilitated the penetration of foreign companies into every corner of the rainforest, as well as cattle ranchers, soy farmers, loggers and mineral companies from the more developed parts of Brazil.  Almost 20% of the rainforest has been destroyed since the roads came. The Amazon basin is now China’s No.1 supplier of natural resources, replacing its Asian neighbours as their resources have become depleted. In a relatively short time, China has become Brazil’s major trading partner, overtaking the US and Europe. But China’s voracious demand for iron ore and timber, as well as soy and beef, is not only fuelling deforestation but negatively influencing Brazil’s environmental protection laws, in the view of researchers. In a 2012 paper entitled Amazonian forest loss and the long reach of China’s Influence¹, the authors found that “the rapid rise in exports of soy and beef products to China are two of the major drivers of Amazonian deforestation in Brazil”. The paper further argues that Chinese purchases of agricultural and forest land and Chinese imports of commodities such as timber and aluminium also cause environmental impacts in the Amazon. Chinese financing and investment in Amazonian infrastructure such as railways and mineral processing facilities have additional impacts. The authors say the “direct impact of commodity exports is only the tip of the iceberg of Chinese influence on Amazonia.” “Money earned from this trade is strengthening Brazilian agribusiness interests, with profound effects on domestic politics that are reflected in legislative and administrative changes, weakening environmental protection”. This refers to the recent successful attempt by the agribusiness lobby in the Brazilian Congress to weaken the existing Forest Code, which, although often flouted, has still played an important role in conserving rainforest, rivers and biodiversity. “Impacts can also be expected from Chinese financing under negotiation for infrastructure such as a railway linking the state of Mato Grosso to a port on the Amazon river”, the authors write.

The_Amazon_-_Puente_Guillermo_Billinghurst3

A bridge too far – cutting through the Amazon Image: Robert Middleton

“Mato Grosso, an Amazonian state twice the size of the US state of California, is a major focus of expansion of soy, cotton and intensified cattle production. Chinese purchases of land for agriculture and timber imply an increasing direct role in commodity production. “Other impacts come from exports from mining and from the processing of minerals, especially the demands for charcoal for pig-iron smelters and for electricity from hydroelectric dams for aluminium smelters”. They say Chinese demand for aluminium, an electricity-intensive industry, “contributes to Brazil’s push for a massive increase in building hydroelectric dams in Amazonia over the next decade.” “Brazil’s 2011–2020 ten-year energy-expansion plan (Ministry of Mines and Energy, 2011) calls for 30 large dams to be built in the Legal Amazon [the greater Amazon basin] by 2020, a rate of one dam every four months. “The Chinese-Brazilian alumina plant will be an important beneficiary of the Belo Monte dam, now under construction on the Xingu River, with transmission lines planned to connect Barcarena (where the plant is located) directly to the dam near Altamira, Para.” Belo Monte has environmental and social impacts that extend far beyond the areas that will be directly flooded, and the dam is likely to justify much larger upstream reservoirs to regulate the river’s flow, according to an earlier study by Fearnside in 2006. He also concluded from other studies that “the dam has functioned as a ‘spearhead’ in creating precedents that weaken Brazil’s environmental licensing system and prepare the way for the many dams proposed under the energy-expansion plan”  and that “the influence of both Brazil and China in expanding carbon credit for hydroelectric projects under the Kyoto Protocol’s Clean Development Mechanism has further increased the profitability of dams”. “It should therefore not come as a surprise that China exerts multiple influences on events in Brazil, often to the detriment of the Amazon forest”, concludes the 2012 paper.

Exploit a cow, save a tree

  It notes that Brazil’s boom in agricultural commodities, which earned US$85 billion in 2011, has contributed hugely to the country’s recent economic growth and has reduced its vulnerability to external economic crises. Meanwhile a recent study produced by Imazon (Amazon Institute of People and The Environment), a well-respected research institute based in Belem, has shown that deforestation could be drastically reduced by increasing productivity. Traditionally, Amazon cattle farmers have never bothered about productivity, because it has been so easy just to clear more forest. The Imazon study shows that future projected demand could be entirely met without the need to cut down a single tree, if productivity was increased from the present average of 80 kilos of beef per hectare to 300 kilos. To help farmers learn the new techniques, Imazon suggests that an annual investment of about US$500 million would be enough to pay for technical assistance, reference centres for each region, and model farms to demonstrate good practice. Credit could then be linked to performance. Imazon points out that if nothing is done to increase productivity a further area of almost 13 million hectares will be cleared to meet demand, leading to an annual deforestation rate three to four times greater than the Government’s target of no more than 380,000 hectares a year until 2020. Traditionally the Government has relied on applying hefty fines for illegal clearing. This has two big disadvantages: the deforestation is detected only when it has already happened, and because of Brazil`s complex and lengthy judicial process, the fines are almost never paid. In addition, the powerful farmers` lobby in Congress is adept at voting through “amnesties” at regular intervals to pardon unpaid fines. Now a more intelligent way to inhibit deforestation has been found, this time by the Central Bank. A bank resolution, passed in 2008, compels farmers to prove they are in compliance with environmental laws before they can obtain credit from any official bank. A study by the Nucleus for the Evaluation of Climate Policies of Rio de Janeiro’s Catholic University, PUC, found that, as a result, between 2008 and 2011 a total of 2,700 sq kms was saved from deforestation, because the farmers, deprived of capital, lacked the funding to extend their activities. The study found the correlation between credit and deforestation was stronger in cattle raising. The Government recently celebrated new statistics showing a reduction in deforestation, but as these various studies show, there are many variables involved. If China maintains or increases its demand for the natural resources of the Amazon and for the commodities produced in surrounding areas, the threat to the rainforest will continue. – Climate News Network ¹Philip M. Fearnside, Adriano M. R. Figueiredo and Sandra C. M. Bonjour