Trade Deals Deliver Strong Environmental Terms, Could Do Better Still
International trade and investment agreements (TIAs) are delivering increasingly strong environmental terms and creating a real-world policy laboratory for measures that are better still, according to a new study by the Waterloo, Ontario-based Centre for International Governance Innovation (CIGI).
Researchers Jean-Frédéric Moran, a Canada Research Chair in International Political Economy at Laval University, and M.Sc. candidate Rosalie Gauthier Nadeau examined 285 different types of environmental provisions contained in 689 trade agreements collected in the Trade and Environment Database (TREND).
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While noting criticism that such green clauses are inserted in TIAs insincerely and solely to “temper opposition” to their adoption, the pair concludes, “recent studies have found strong evidence that environmental clauses in trade agreements can lead to reduced pollution levels. Even clauses that are relatively vague and not subject to a trade dispute settlement mechanism are statistically related to enhanced environmental protection.”
National regulations “for the protection of animal or plant life and for the conservation of natural resources” have been protected from trade challenge “since their introduction in the General Agreement on Tariffs and Trade (GATT) in 1947,” the authors note—reminding readers of a fact overlooked in many critiques of TIAs.
Those terms “have been reproduced in more than 300 different trade agreements,” and reinforced in more recent TIAs such as the 2016 Comprehensive Economic and Trade Agreement (CETA) between the European Union and Canada.
But the authors are more interested in what they describe as the “legal one-hit wonders”—promising or creative terms designed to protect the environment in a variety of ways that have been included in only a few TIAs to date, but could be adopted in more.
The CETA, for example, is unique in explicitly excluding water from its scope, “providing that ‘water in its natural state…is not a good or a product,’ and that no country is obliged to ‘permit the commercial use of water for any purpose.’”
Several lesser-known environmental clauses, including one in the suspended Trans-Pacific Partnership (TPP), aim to encourage trade in environmental goods and services. The TPP would also have been the first TIA to enjoin signatories to reduce and eventually eliminate all subsidies that contribute to overfishing.
Other agreements explicitly mandate their parties’ reductions of greenhouse gas emissions, include “commitments to monitor the state of the environment and periodically report publicly on this matter,” and oblige signatories to “ensure the participation of the public in their domestic environmental impact assessments.”
A 2001 agreement creating a Caribbean trade community established four specialized agencies to respond to disasters, monitor weather and climate, and study connections between the environment and public health.
“While not all rare provisions deserve to be widely diffused,” the authors contend, “some of them do.”
Moran and Gauthier Nadeau single out for mention “the principle of common but differentiated responsibilities, [which] asserts that if states have a common responsibility to protect the environment, this responsibility differs due to states’ contribution to environmental problems and their capacity to manage them.”
Of the 689 agreements catalogued on the TREND database, they note, “only two—both signed between the European Union and Latin American countries in July 2012—explicitly acknowledge this principle.”
“Considering [its] legal, economic, and political importance, in particular as it relates to climate change,” they comment, “it is surprising that trade agreements’ environmental chapters do not refer to it more regularly.”