Of course, the removal of "trade barriers" relating to "climate-friendly technologies" will account for only a tiny fraction of trade and the removal, whilst undoubtedly a positive move, will not make any drastic difference to the diffusion of clean technologies most of which are intra-firm.
This is not to say that this is not a welcome development. In recent work (to be posted on soon) we find that the two main obstacles to a firm implementing environmental management practices were (1) Cost and (2) information. This may help on both counts.
US, EU Propose Trade Plan to Counter Climate Change [PlanetArk]
WASHINGTON - The United States and European Union launched a proposal in world trade talks on Friday aimed at countering global climate change by removing barriers to trade to climate-friendly technologies.
"WTO (World Trade Organization) members have an unprecedented opportunity to address in a concrete and meaningful way the global environmental challenge of climate change," US Trade Representative Susan Schwab said in a statement.
"By eliminating tariff and nontariff barriers to environmental goods and services, particularly clean energy technologies, we can lower their costs and increase global access to and use of these important products," Schwab said.
The push in the long-running Doha round of world trade talks came as delegates from about 190 nations were preparing to meet in Bali, Indonesia, from Dec. 3 to 14 to try to launch separate negotiations on a new pact to deal with climate change.
The goal is craft a successor to the United Nations' Kyoto Protocol, which binds 36 industrial nations to cut greenhouse gas emissions by 5 percent below 1990 levels by 2008-12.
EU officials called the joint proposal "an important part of the EU and the US' contribution" to a Dec. 8-9 trade ministers meeting also being held in Bali in conjunction with the broader climate change talks.
President George W. Bush announced shortly after taking office in 2001 that the United States would not join the Kyoto pact because it excluded major developing countries like India and China that are a growing source of greenhouse gas emissions.
Bush said on Wednesday the United States' guiding principle in the Bali talks would be to find a way to reduce greenhouse gases "that does not undermine economic growth or prevent nations from delivering greater prosperity for their people."
Global trade in the environmental goods covered by the US-EU proposal totalled about US$613 billion in 2006, with exports increasing about 15 percent annually, US trade officials said.
The World Bank has estimated removing tariffs and nontariff barriers on key climate and clean energy technologies could increase trade in those goods by 7-14 percent a year and help to cut greenhouse gas emissions, US trade officials said.
The US-EU proposal calls for all WTO members to eliminate tariffs on 43 climate friendly technologies identified by the World Bank, such as solar panels and wind turbines.
A smaller group of developed and advanced developing countries would negotiate a broader "environmental goods and services agreement," that would include goods related to air pollution control, hazardous waste management, clean water and other environment goals, a US trade official said.
The plan would liberalize trade in environmental services like pollution monitoring, cleaning up hazardous waste sites and production of renewable energy, the official said.
The United States and the European Union are leading exporters of environmental goods and services, but India and China are also developing strong capacity, US and EU officials said.
The six-year-old Doha round of world trade negotiations has showed some signs of progress in recent months, but many experts remain sceptical a deal will reached.
However, it is possible that countries could still reach an agreement to liberalize trade in environmental goods and services even if the overall Doha talks flounder, the US trade official said.