THE World Trade Organization (WTO) said countries vulnerable to climate change can tap trade to access the necessary technology and services, in the process boosting the flow of goods needed for the clean-energy transition.
In its World Trade Report 2022 issued on Monday, the WTO also found that gross domestic product losses are expected to be higher in regions vulnerable to weather-related hazards and with lower resilience to losses, such as the Middle East, North Africa, South and Southeast Asia, and Sub-Saharan Africa.
“International trade can help support climate change strategies, such as prevention and reduction of, and preparedness for, climate risk, as well as recovery and rehabilitation from climate disasters. Trade can also contribute to strengthening food security during climate-induced supply-side disruptions,” the WTO said in the report.
“Higher temperatures, rising sea levels and more frequent extreme weather events bring the prospect of productivity losses, production shortages, damaged transport infrastructure, and supply disruptions,” it added.
The WTO sees trade as accelerating the low-carbon transition and the generation of green jobs.
“Though trade, like most current economic activity, generates greenhouse gas emissions, it also contributes to reducing them, by enabling access to cutting-edge climate technologies; incentivizing innovation in low-carbon technologies by expanding market size; and fostering competition and scale economies that help drive down costs.”
The WTO added that removing tariffs and reducing non-tariff measures on a specific group of energy-related environmental goods could increase exports and lower net carbon emissions.
“WTO simulation analysis suggests that eliminating tariffs and reducing non-tariff measures on some energy-related environmental goods and environmentally preferable products could increase global exports in these products by $109 billion (5%) and $10.3 billion (14%), respectively, by 2030,” the WTO said.
“The resulting improvements in energy efficiency and renewable energy adoption are estimated to reduce net carbon emissions by 0.6%…,” it added.
The report also projected that the transition to clean energy could create around 30 million new jobs for clean energy and related sectors by 2030.
“The shift… could generate 14 million new jobs in clean energy sectors and 16 million jobs in related sectors globally by 2030,” WTO Director General Ngozi Okonjo-Iweala said.
“Trade is instrumental for investments in clean energy to have the greatest reach and impacts, at lowest cost and where they are needed the most. These are returns we would be unwise to forego, especially now that the big green investment push we need will coincide with rising real costs of capital and looming uncertainty about energy security due to geopolitical tensions and war,” she added. — Revin Mikhael D. Ochave