The impact of climate policies on farm trade: What implications for developing countries?

Transcription

1 The impact of climate policies on farm trade: What implications for developing countries? FAO expert consultation Rome, 5-6 November 2013 Jonathan Hepburn Programme Manager, Agriculture

2 1. Introduction

3 2. How could climate policies affect trade?

4 Climate policies can affect trade in different ways (i). Border measures Imports / exports (ii). Domestic measures Subsidies / taxes (iii). Regulatory measures Health and safety, technology, environment, etc. + private standards Adapted from analysis in Blandford, D (2013), International trade disciplines and policy measures to address climate change mitigation and adaptation in agriculture. and IPC., Geneva

5 'Bona fide' climate measures unlikely to discriminate... but some policies have generated tension Dispute Country Complainant Renewable energy sector Canada Japan Renewable energy generation sector EU and certain Member States China Measures related to solar cells and solar modules India USA Importation of biodiesels EU and a Member State Argentina Importation, marketing, and support of biodiesel industry EU Argentina USA China Local content requirements Biodiesels Countervailing duty measures Countervailing duty measures on certain products from China Source: Adapted from Monkelbaan, J and Christy, M. (forthcoming, 2013), Some Selected Conflicts Between WTO rules and Climate Change Policies., Geneva. Dispute Numbers: DS4129 (Sept 2010), DS452 (Nov 2013), DS456 (Feb 2013), DS443 (Aug 2012), DS459 (May 2013), DS437 (May 2012)

6 (i). Border measures

7 (ii). Domestic measures

8 EU: climate-related conditions partially used to justify ongoing decoupled direct pmts EU domestic support Support (bn Euros) / AMS amber Total de minimis blue box green box Source: EU subsidy notifications to the WTO; compilation. Note: post-doha OTDS cap is EUR 22.1bn DS was EUR79bn (=USD110bn), GB was EUR64bn (=USD89bn)

9 Biofuel blending mandates: Pushing up prices when yields are low Change in domestic price relative to change in world price (%) during five price spike periods. Source: Babcock, B (2011), "The Impact of US biofuel policies on agricultural price levels and volatility., Geneva.

10 (iii). Regulatory measures

11 EU thresholds for GHG savings creating tension with some trading partners Source: Figures are based on Annex V of the EU Renewable Energy Directive (RED), but not all details are shown. The value for corn ethanol refers to Community production only. There is no default value for third country production.

12 Perverse effects of uncoordinated env'l standards: US - Brazil ethanol trade flows in 2011 US exports 14,700,000 litres Brazil* exports 10,150,000 litres * Includes exports via the Caribbean Source: Adapted from GTIS data presented in Meyer, S, Schmidhuber, J and Barreiro-Hurlé, J (2013), Global Biofuel Trade: How Uncoordinated Biofuel Policy Fuels Resource Use and GHG Emissions. May 2013, and FAO.

13 3. What might be the implications for developing countries?

14 Developing countries: varying importance of ag trade in economy, overall emissions... I Source: (2013, forthcoming), Addressing the climate change and agricultural trade interface: a scoping paper., Geneva.

15 ...but large economies represent bulk of emissions Source: Cline (2007), cited in (2013, forthcoming), Addressing the climate change and agricultural trade interface: a scoping paper., Geneva.

16 Reverse trend on ag ODA, and ensure coherence with climate financing + 'aid for trade' Source: OECD. In Konandreas, P. (2012), Trade Policy Responses to Food Price Volatility in Poor Net Food-Importing Countries. and FAO.

17 4. Conclusion

18 Ways forward 1). Policy coherence: Governments need to discuss trade and climate in fora at WTO and UNFCCC; 2). New research agenda: Needs to address how border measures, domestic measures and regulations could affect poverty and food security; Photo: Ammad Bahalim, 3). Applied research: Network could bring new analysis to attention of policy-makers and negotiators on ag, trade + climate Photo: WTO

19 Thank you. Jhepburn [at] ictsd.ch

20 References and further reading References: Babcock, B (2011), "The Impact of US biofuel policies on agricultural price levels and volatility., Geneva. Blandford, D. (2013) International Trade Disciplines And Policy Measures To Address Climate Change Mitigation And Adaptation In Agriculture. and IPC., Geneva. (2013, forthcoming), Addressing the climate change and agricultural trade interface: a scoping paper., Geneva. Meyer, S, Schmidhuber, J and Barreiro-Hurlé, J (2013), Global Biofuel Trade: How Uncoordinated Biofuel Policy Fuels Resource Use and GHG Emissions. May 2013, / FAO. Monkelbaan, Joachim and Michelle Christy; (2013, forthcoming); Some Selected Conflicts Between WTO rules and Climate Change Policies ;, Geneva. Further reading: research on agricultural trade and climate change: research on agricultural trade and food security: research on biofuels:

21 (additional slides)

22 Climate change: trade could help partially offset growing food insecurity Increased no. of malnourished children by 2050 due to climate change Sub-Saharan Africa South Asia East Asia and the Pacific Europe and Central Asia Middle East and North Africa Latin America and the Caribbean millions of additional malnourished under-5 children by 2050 Source: Adapted from Nelson et al, (2009), The Role of International Trade in Climate Change Adaptation. and IPC. Note: Assuming no carbon fertilisation under NCAR and CSIRO climate change scenarios. Figures given are to the nearest million.

23 Sustainable farm productivity growth needed to raise rural incomes and match growing demand

24 Measuring GHG emissions: the need for a life cycle approach