Trade in Environmentally Sound Technologies - the Perspective of Developing Countries

Background

In light of the 2030 Agenda for Sustainable Development and the Paris Agreement on Climate Change, environmentally sound technologies increasingly gain the attention of the global community due to the important role they can play in the fight against climate change and in achieving the Sustainable Development Goals. Environmentally sound technologies, often also referred to as “clean technologies”, are a subset of environmental goods, which are defined as goods that directly contribute to environmental protection and climate change mitigation. 

To promote the diffusion and to scale up the uptake of environmentally sound technologies, the international regulatory and political framework for trade and investment in such technologies needs to be decisively reshaped. An essential step is to remove barriers to trade in certain goods (e.g. wind turbines, solar panels, carbon dioxide scrubbers, recycling machinery, etc.) of particular importance for environmental protection and climate change mitigation and adaptation, as has been discussed in the negotiations of the Environmental Goods Agreement, for example. At the same time, countries are also promoting trade and investment in environmentally sound technologies through regional and bilateral trade agreements.

What is apparent is that not many developing countries have yet benefited from trade liberalization in environment goods and services. Many still lack the knowledge and capacity to harness trade and investment opportunities for environmental goods and services. Addressing such gaps requires concerted action for an inclusive, transparent and sustainable trading system.  The United Nations Environment Programme undertook a project to support and enable developing countries to objectively assess opportunities, benefits and challenges of liberalized trade in environmentally sound technologies. 

Objective

The project aims to contribute towards sustainable, environmentally credible and inclusive value chain integration and trade in environmentally sound technologies by providing support to developing countries to identify, assess and harness opportunities of liberalized trade in environmentally sound technologies, as well as to host dialogues with a broad range of stakeholders to discuss environmental technology trade opportunities and perspectives in developing countries.

Key Activities

Activity 1 – Regional assessments of opportunities for intra-regional trade liberalization of environmentally sound technologies

Assessments to identify opportunities for trade liberalization in selected environmentally sound technologies were undertaken in the regions of the Association of Southeast Asian Nations (ASEAN) and the East African Community (EAC). As part of each regional assessment, one national case study was developed, in order to assess the implications from enhanced regional value chain and trade cooperation in a particular country context. For the ASEAN region, a closer look was taken at the solar photovoltaic industry in Malaysia, while in the case of the EAC, trade and value chain development of solar photovoltaic products was assessed in Kenya. The ASEAN regional assessment can be accessed here and the EAC regional assessment can be accessed here.   

Activity 2 – Policy dialogue and capacity building workshop on trade in environmentally sound technologies

The events resulted in the collection and dissemination of national and regional best practices for value chain integration and trade in environmentally sound technologies. They built developing country understanding and capacity for effective integration in environmentally sound technology value chains and active involvement in trade negotiations. Ultimately, the dialogue and capacity building events have enabled policy makers to better assess options related to relevant trade liberalization processes and helped to build consensus, generate momentum and advance the agenda for future work.

• One workshop was held in Malaysia on 13 October 2017 on “Unlocking Trade in Environmentally Sound Technologies: A Regional Perspective from ASEAN”. Supported by the Malaysian Ministry of Energy, Green Technology and Water (KeTTHA) and the University of Malaya, the workshop was held in conjunction with the International Greentech & Eco Products Exhibition & Conference Malaysia (IGEM 2017), a flagship trade event in the region. The workshop brought together 40 participants from government agencies, private sector associations, and civil society groups to discuss key challenges and opportunities for trade and value chain integration in environmentally sound technologies in Malaysia and in the ASEAN region.
• A high-level dialogue entitled “Unlocking Trade in Environmentally Sound Technologies to Tackle Air Pollution” was held at the third United Nations Environment Assembly in Nairobi in December 2017. Policymakers and business leaders gathered to discuss the role of trade in scaling up clean technologies and called for joint action to remove barriers and foster partnerships.
• A regional workshop was held in Nairobi in December 2017, with trade and environment stakeholders from Kenya, Ethiopia, Rwanda, Uganda, and the World Trade Organization. Following the high-level event at United Nations Environment Assembly, the workshop brought together 24 representatives from East African countries to discuss key opportunities and barriers to trade in environmentally sound technologies in the East African region.

Activity 3 – Global analysis of the role and implications of trade liberalization of environmentally sound technologies for developing countries

The global study outlined the history, context and status quo of international and regional negotiations on trade in environmentally sound technologies, explained the modalities of trade liberalization and implementation, and defined key related concepts. On the basis of this conceptual foundation, the analysis zoomed in on developing country participation in trade in selected environmentally sound technologies, identified opportunities and key challenges, and highlighted potential capacity needs. Building on this, it provided recommendations for harnessing opportunities and addressing risks.

This project was supported by the European Commission through the Global Public Goods and Challenges (GPGC) programme.

CTCN/United Nations Environment Programme Webinar on Trade in Environmentally Sound Technologies: Implications for Developing Countries

Partners

• United Nations Environment Programme DTU Partnership
• Technology and Management Centre for Development – University of Oxford
• Norwegian University of Science and Technology - NTNU
• African Centre for Technology Studies
• United Nations Economic and Social Commission for Asia and the Pacific

Work by the Hub on Environmentally Sound Technologies (EST)

• Report on South-South Trade in Renewable Energy
• Trade and Climate Change-a joint report by United Nations Environment Programme and the World Trade Organization
• Scoping Study on Intra-ASEAN Value Chain Cooperation and Trade in Energy Efficiency and Renewable Energy Technologies
• Mapping of Trade in Environmental Goods
• Green Economy-Trade Opportunities Project: Ghana Project

Relevant links

• The Third United Nations Environment Programme Assembly (UNEA)
• Resolution on “Investing in innovative environmental solutions for accelerating the implementation of the Sustainable Development Goals”
• Climate Technology Centre and Network
• Climate and Clean Air Coalition
• Asia-Pacific Research and Training Network on Trade
• UN Environment Programme Regional Office for Asia Pacific
• UN Environment Programme Regional Office for Africa
• UN Environment Programme Energy
• UN Environment Programme International Environmental Technology Centre
• International Partnership for Energy Efficiency Cooperation (IPEEC)
• Ren21