Reports Climate change, trade and emissions leakage: trade measures and climate agreements

Reports
READING TIME 15 mins

Climate change, trade and emissions leakage: trade measures and climate agreements

This paper comprises five sections. Section 1 gives a brief summary of the status
of climate change, the history and future of international climate negotiations and
agreements, remarkable attributes of climate change issues, and intersections of
climate change and international trade. Section 2 describes the various definitions
of carbon leakage and details the impacts of carbon leakage on the international and
domestic climate change regimes. Based on the analyses, this research proposes an
alternative definition of carbon leakage (emissions leakage). Section 3 discusses
international climate change frameworks that address the emissions leakage
issue without trade measures. Section 4 discusses trade measures integrated into
international climate change agreements that address the emissions leakage issue. It
lists relevant trade measures and analyzes their feasibility and effectiveness. Then, it
focuses on compatibility of these measures with WTO law. Lastly, Section 5 explores
possible designs of international climate change agreements. It also analyzes the role
of trade measures in the enforcement of international climate agreements. The paper
concludes by proposing key elements that must be included in the establishment of an
international climate agreement if it is to be effective.

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Published March 2017 Center for International Environment & Resource Policy

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