Quarterly Update - Issue 7

Welcome to the seventh edition of the TESS Quarterly Update. In this issue, we start with a round-up of a selection of major international gatherings, followed by updates on the activities and impacts that TESS has pursued this past quarter to foster multilateral cooperation. Coming up in early 2024, look out for our “Year Ahead” update and a series of Synergies articles from invited experts on moving “From Vision to Action” on trade and sustainability at MC13 and beyond.

With less than three months to the Thirteenth WTO Ministerial Conference (MC13) in Abu Dhabi, United Arab Emirates, on 26–29 February 2024, WTO members have been urged to step up efforts to secure meaningful outcomes. At recent meetings to prepare for the Ministerial Conference, the WTO Director-General called on members to redouble efforts in closing gaps in the negotiations in advance of MC13, including on issues of agriculture and fisheries, among others. Led by the chair of the Committee on Trade and Environment (CTE), informal consultations are also advancing on trade and environment, with members discussing a potential text on sustainable development for inclusion in the MC13 outcome document.

At a CTE meeting on 13–16 November, members continued to explore how to reinvigorate environment discussions at the WTO, potential environment-related outcomes at MC13, and future thematic sessions of the CTE, following the first-ever thematic CTE session in November, which focused on trade contributions to energy transition efforts. The seventh and eighth of a series of “Fish Weeks” were convened by the chair of the fisheries subsidies negotiations to advance work towards an outcome at MC13. A core aim has been to make recommendations for additional provisions that would further enhance disciplines on subsidies contributing to overcapacity and overfishing by MC13, as stipulated in the WTO Agreement on Fisheries Subsidies adopted at MC12. As of mid-December, the chair’s effort to bridge members’ views on key provisions had not yet succeeded, and the chair announced an intensive "fish month" of negotiations in mid-January. Meanwhile, an additional 12 countries deposited their instruments of acceptance of the agreement, bringing the total number to 55. Two-thirds of WTO members must formally accept the protocol of the agreement for it to come into force.

Over the past quarter, the respective co-sponsors of the Trade and Environmental Sustainability Structured Discussions (TESSD) initiative, the WTO Dialogue on Plastics Pollution (DPP), and the Fossil Fuel Subsidy Reform (FFSR) initiative each discussed the road to MC13 and potential outcomes or progress to report. Notably, in pre-plenary meetings held in September and November, DPP members made progress on the revised draft of a potential ministerial statement on plastics pollution for MC13.

Finally, to kick off the quarter, the WTO Public Forum 2023 took place on 12–15 September under the theme It is time for action, examining how trade can contribute to a greener and more sustainable future, bringing together a diverse range of perspectives and issues from around the world. In addition to joining numerous WTO Public Forum sessions in speaking roles, TESS collaborated with Geneva Trade Week where we hosted the high-level opening plenary on the role of cooperation on trade and trade policy in advancing action on the SDGs.

As governments and stakeholders gathered at the 2023 United Nations Climate Change Conference (COP28) in Dubai, United Arab Emirates, from 30 November to 12 December, the stakes could not have been higher. Critical items on the agenda included operationalizing funding arrangements for the loss and damage fund , new quantified collective goals on climate finance , and reaching a framework for the Global Goal on Adaptation . Crucially, COP28 adopted a decision on the first global stocktake under the Paris Agreement. The stocktake will now inform the next round of nationally determined contributions to be put forward by 2025, encouraging parties to come forward with ambitious emission reduction targets aligned with 1.5oC pathways. Of note, the decision calls on parties to transition away from fossil fuels in energy systems in a just, orderly, and equitable manner.

Against this background, questions around how cooperation on trade and trade policies can help accelerate efforts to phase out fossil fuels, decarbonize economies, support climate adaptation, respond to climate-related loss and damage, and foster climate-resilient development attracted growing attention. Notably, trade had a higher profile than previously at a UN climate conference. On 4 December, the host state and UNFCCC held the first-ever Trade Day , and a Trade House Pavilion hosted by ICC, ITC, UNCTAD, and WTO provided a dedicated space for discussions on the nexus of trade, trade policies, and climate action throughout COP28. Among other Trade Day activities, members of the Coalition of Trade Ministers on Climate shared their views at a leaders conversation on the importance of ministerial leadership for a trade-related contribution to the climate agenda that is ambitious, inclusive, fair, and effective. The coalition co-leads partnered with TESS on a roundtable meeting to hear perspectives from the global climate community on priorities for cooperation by trade ministers (see below).

On 11–19 November, the third of five sessions of the Intergovernmental Negotiating Committee to develop a legally binding legally instrument on plastic pollution (INC-3), was held in Nairobi, Kenya. After a week of substantive discussions, negotiators at the UNEP headquarters agreed that a revised Zero Draft should be prepared for INC-4, which, among other items, will include the co-facilitators’ compilations of discussions and submissions from INC-3. However, to the disappointment of governments and stakeholders hoping for an ambitious global plastics treaty that meets the scale and urgency of the plastic pollution crisis, delegates failed to agree on a mandate for intersessional work ahead of INC-4 in April 2024, which will make the goal of completing negotiations by the end of 2024, as expressed in UNEA Resolution 5/14 , harder to achieve.

On 18–19 September, the UN 2023 SDG Summit , convened under the auspices of the General Assembly was convened in New York, USA, marking the halfway point for the 2030 Agenda. Sounding the alarm, an advance report of the UN Secretary-General emphasized that many of the SDGs are moderately to severely off track, with only 12% of the 140 assessed targets on course to meet the 2030 deadline. During the summit, the Secretary-General called upon leaders to accelerate SDG progress by focusing on a number of key areas, including, among others, through a significant increase in financing for sustainable development to at least $500 billion per year and shifting the focus of voluntary national reviews towards accountability of commitments made. An SDG Summit newsletter summarizing the outcome of the two-day event is available for download.

While there was a general sense that the summit was a missed opportunity to accelerate much needed action and collaboration, the issue of mobilizing finance was high on the agenda, including through the SDG Stimulus Plan , climate finance, an effective debt release mechanism, and, notably, reform of the international finance architecture. As an outcome of the summit, leaders adopted a Political Declaration in which they “look forward to the Summit of the Future in 2024 as an important opportunity to […] accelerate the implementation of the 2030 Agenda and its SDGs.” In the lead up and during the Summit of the Future , scheduled for September 2024, member states are expected to negotiate and endorse a wide-ranging Pact for the Future.

In other developments, the seventh session of the Intergovernmental Group of Experts on Financing for Development, hosted by UNCTAD in Geneva on 1–3 November, considered how the financing of an environmentally sound industrialization strategy, which integrates development and climate challenges, can be supported by the full range of development finance measures envisaged in the Addis Ababa Action Agenda . Session documents and presentations are available on the UNCTAD website, including the background Note by the secretariat. Earlier, at UNCTAD’s 8th World Investment Forum, held in Abu Dhabi on 16–20 October, with foreign direct investment experiencing a continued downturn , participating ministers highlighted the need to bridge the $4 trillion annual investment gap developing countries face to achieve the SDGs.

In encouraging news, at the seventh Global Environment Facility (GEF) Assembly in Vancouver, Canada, on 22–26 August, members agreed to ratify the Global Biodiversity Framework Fund, which was established to support the implementation of the Kunming-Montreal Global Biodiversity Framework (GBF). Related to efforts to implement the GBF, two ad hoc working groups of the Convention on Biological Diversity (CBD) held intersessional meetings in Geneva on 12–18 November: the first to discuss the ways to respect and protect the roles and contributions of Indigenous Peoples and local communities towards the conservation and sustainable use of biodiversity; the second to discuss a multilateral mechanism on benefit-sharing from the use of digital sequence information on genetic resources. Later that month, collaboration with the CBD in the context of talks on this multilateral mechanism was on the agenda at the FAO headquarters in Rome, Italy, at the tenth session of the Governing Body of the International Treaty on Plant Genetic Resources for Food and Agriculture (ITPGRFA)—a legally binding instrument aimed at conserving crop diversity and sharing its benefits for sustainable agriculture and food security.

Acknowledging the expected increase in mining for the energy transition, UNEA-5 Resolution 5/12 in March 2022 mandated a process to develop “non-prescriptive proposals to enhance the environmental sustainability of minerals and metals along their full life cycle.” Capping this process, UNEP convened a Global Intergovernmental Meeting on Minerals and Metals in Geneva on 7–8 September, where, among other items, delegates discussed 24 draft proposals . Member states are now seeking to translate these discussions into concrete language for a resolution at UNEA-6 in late February 2024. Mineral resource governance, mining, and the energy transition were also on the agenda of the 19th Annual General Meeting of the Intergovernmental Forum on Mining and Sustainable Development (IGF), which was hosted by UNCTAD on 7–9 November. With more than 80 national governments as members, the IGF meeting focused on opportunities offered by the burgeoning demand for energy transition minerals to rethink how benefits are shared and multiplied, while ensuring a just transition.

Beyond multilateral processes, which are the focus of this Quarterly Update, other important activities on issues such as critical minerals, energy transitions, and trade and investment have been happening in regional and bilateral settings, as well as through the G20 , G7 , and BRICS , among others.

What We've Focused On

Climate Crisis

Our engagement at COP28 included hosting and speaking at a number of events in the Trade House Pavilion. The themes discussed at these events included, among others, the role of trade and small business climate action in SIDS, LLDCs, and LDCs, the importance of cooperation on non-tariff measures and also on trade in low-carbon technologies, and the need for a development friendly agenda for trade and climate. A TESS highlight at COP28 was organizing with the co-leads of the Coalition of Trade Ministers on Climate a roundtable meeting , hosted in Ecuador’s One Planet Pavilion, to hear perspectives from the global climate community on priorities for cooperation by trade ministers. As the COP opened, TESS published a Synergies article on the importance of inclusive international cooperation on trade to address the climate crisis in an ambitious, fair, and just manner. In the news , our Executive Director emphasized the need to discuss these issues at the WTO.

As the UN climate conference came to a close, we published a policy brief by Vicente Paolo Yu on Addressing the climate technology gap through effective technology transfer. The paper’s findings were discussed in informal meetings and consultations with delegations in Geneva and were also shared at COP28.

A notable achievement over the past quarter was the release of a report on Principles of international law relevant for consideration in the design and implementation of trade-related climate measures, which was prepared by an international legal expert group convened by TESS. A number of the experts were present to discuss the principles at a packed session organized by TESS at the WTO Public Forum. We also highlighted the principles at a session at COP28. A short commentary on the principles and their rationale was also published to coincide with the climate summit.

In September, TESS collaborated with Geneva Trade Week to host a reception for trade and sustainability colleagues with trade ministers from developing countries that are members of the Coalition of Trade Ministers on Climate as keynote speakers. We encourage you to read the Synergies article on Advancing inclusive cooperation on trade and climate derived from the speech by Hon. Keisal Peters, Minister of Foreign Affairs and Foreign Trade of St. Vincent and the Grenadines. We were also delighted to host a roundtable breakfast on climate and trade during Geneva Trade Week, which brought together a broad range of experts and stakeholders to share their priorities for cooperation on the climate-trade-sustainable development interface.

View our thematic work on the climate crisis .

Plastic Pollution

TESS played an active role on the ground in Nairobi during INC-3. Our activities included a series of informal roundtables with stakeholders and government officials on financing implementation of the plastics treaty, and on reduction of primary polymer production. We spoke at an event on rethinking the future of single-use plastics, hosted by UNCTAD and the African Law Network, which brought together a range of experts and stakeholders from East Africa and highlighted their work to develop regional strategies on plastic pollution. We also moderated an official INC-3 side event on the role of trade measures in the future instrument.

Additionally, we provided support to the High Ambition Coalition to End Plastic Pollution throughout the week-long discussions. You can access the High Ambition Coalition Ministerial Joint Statement for INC-3. As the negotiations on the global plastics treaty advance, we look forward to continuing to support the High Ambition Coalition’s co-chairs and members. In the lead up to INC-3, TESS published a policy paper on Standards and related initiatives in international cooperation to end plastic pollution, followed in November by a policy brief on Options for trade-related cooperation on problematic and avoidable plastics.

During the quarter, we continued to support the work of the DPP at the WTO. We contributed comments at the DPP’s September pre-plenary meeting and again at the November pre-plenary meeting on drafts of a potential MC13 Ministerial Statement. In our comments, we highlighted that the proposed statement will have an important role in signalling the willingness of members to continue collective work at the WTO on the nexus of trade and plastic pollution, and to pursue concrete outcomes that contribute to international cooperation on plastic pollution. Additionally, we have prepared an informal briefing note for DPP co-sponsors on discussions at INC-3 on trade provisions in the Zero Draft text of the plastics treaty.

Finally, our activities on plastic pollution also included partnering with the Government of Rwanda and the French Ministry of Ecological Transition for a high-level side event at COP28 in the Rwanda Pavilion on the climate impact of plastic production, which served to connect the dots between the plastics and climate crises.

View our thematic work on plastic pollution .

Biodiversity and Sustainability in Agriculture, Food Systems, and Use of Natural Resources

In our thematic area on the natural environment, in September we published a policy paper on Sustainability standards and requirements for agriculture: International trade considerations. In addition, we published a Synergies article by Bernice Lee of Chatham House on the burning issue of why we need global cooperation on critical mineral supplies. We also published an article by Professor Joost Pauwelyn of the Geneva Graduate Institute on the broader subject of Recent innovations in trade and sustainability cooperation, which cuts across all of our thematic work.

As part of our ongoing work on a trading system that supports sustainability in the agricultural sector, we have advanced consultations on options for addressing environmentally harmful agricultural subsidies in the WTO context, and established an expert group from a diversity of regions and policy communities to advise on analytical work related to identifying and addressing such subsidies. In 2024, we look forward to expanding our work on nature and climate-positive agricultural trade, sustainable food systems, and food security, which will involve meetings, consultations, and roundtable discussions that mobilize and connect expertise in Geneva and across relevant international processes.

View our thematic work on the natural environment .

Circular Economy

During the quarter, we launched an expert group on trade, circular economy, and sustainable development. Bringing together leading international experts from the trade, environment, and sustainable development communities. The group has been mobilized by TESS to develop guidance on best practices and approaches on the trade dimensions of circular economy policies and measures, with the overarching goal of advancing sustainable development.

The group’s first meetings were held in September and October and will continue in early 2024, with the goal of publishing a report in the first quarter of 2024 that contributes to ongoing deliberations on trade, circular economy, and sustainable development at the WTO in the context of the CTE and the TESSD and DPP initiatives, as well as in other international organizations and processes. In November, TESS introduced the expert group and its objectives at an informal working group meeting of TESSD.

View our thematic work on circular economy .

Synergies

We invite you to read articles published over the past quarter in Synergies , the TESS blog dedicated to promoting inclusive policy dialogue at the intersection of trade, environment, and sustainable development, featuring views from a diversity of international thought leaders and experts as well as TESS staff.

Achieving an Inclusive Circular Economy: The Role of the Harmonized System of Codes by Jack Barrie and Gael Grooby (19 December 2023)

Addressing the Climate Technology Gap in Developing Countries Through Effective Technology Transfer by Vicente Paolo Yu (13 December 2023)

Na?ve but Necessary? Cooperation on Critical Mineral Supplies by Bernice Lee (05 December 2023)

For a Trading System that Supports an Ambitious Climate Agenda, Climate-Resilient Development, and Just Transitions by Carolyn Deere Birkbeck, Christophe Bellmann, and Fabrice Lehmann (28 November 2023)

Six Principles to Bolster Cooperation on Trade-Related Climate Measures by an International Legal Expert Group on Trade-Related Climate Measures and Policies (28 November 2023)

Five Suggestions to Reframe Discussions on Environmental Goods, Services, and Technologies at the WTO by Christophe Bellmann (06 November 2023)

Recent Innovations in Trade and Sustainability Cooperation by Joost Pauwelyn (26 September 2023)

Advancing Inclusive Cooperation on Trade and Climate by Hon. Keisal Peters (18 September 2023)

The Case for a Global Triangle Forum at the WTO by Pascal Lamy, Geneviève Pons, Colette van der Ven, and Claudia Azevedo (12 September 2023)

Replays

In case you missed them, we have compiled links to video recordings of a selection of events over the past quarter that shed light on some key trends, issues, policy debates, and collaborations relevant to trade and sustainability.

COP28 Trade House Pavilion Sessions , 30 November–12 December 2023

The Trade House Pavilion hosted by ICC, ITC, UNCTAD, and WTO at COP28 provided a dedicated space for discussions on trade and climate action. Video recordings of the sessions are available.

The Economic Government of the World 1933–2023 , 26 October 2023

In his latest book, which forms the basis of this LSE lecture, Martin Daunton, Emeritus Professor of Economic History at the University of Cambridge, pulls back the curtain on the institutions and individuals who have created and managed the economy over the last ninety years, exploring how and why one economic order breaks down and another is built.

SDG Summit Debrief , 28 September 2023

The SDG Lab, CEPEI, and IISD hosted a panel discussion and Q&A session after the UN 2023 SDG Summit closed. Experts provided a brief snapshot of highlights and their links to next year’s Summit of the Future.

WTO Public Forum 2023 , 12–15 September 2023

Under the theme It is time for action, the WTO Public Forum 2023 examined how trade can contribute to a greener and more sustainable future. The forum’s programme included an array of events on trade and sustainability that are available in video and/or audio format.

The Role of Trade & Trade Policy in Advancing Action on the SDGs: How to Boost Coherence and Cooperation? , 6 September 2023

To open Geneva Trade Week 2023, TESS hosted a plenary session on how trade and trade policies are relevant to efforts to advance implementation of the UN Sustainable Development Goals. The session opened with a roundtable discussion among ambassadors, followed by remarks from senior leaders in Geneva-based international organizations.

What We're Reading

To shed light on some key trends, issues, and policy debates from different perspectives relevant to trade and sustainability, we invite you to explore our digest of selected publications released over the past quarter by a diversity of stakeholders.

Trade Policy Tools for Climate Action , WTO, December 2023

This publication by the WTO Secretariat presents a review of trade policies that governments could consider as part of their strategies for climate change mitigation and adaptation.

Towards Eliminating Plastic Pollution by 2040: A Policy Scenario Analysis, Interim Findings , OECD, November 2023

These interim findings aim to support the ongoing negotiations towards a plastics treaty by providing an overview of the benefits and consequences of varying levels of international ambition and policy stringency across the plastics life cycle.

Global Energy Transitions Stocktake: Tracking Progress Toward the Paris Agreement , IEA, November 2023

With the finalization of the first global stocktake of the Paris Agreement, this IEA resource brings together all of its latest data and analysis on clean energy transitions, making it freely accessible.

Emissions Gap Report 2023 , UNEP, November 2023

As greenhouse gas emissions hit new highs, this report finds that the world is heading for a temperature rise far above the Paris Agreement goals unless countries deliver more than they have promised.

Trade and Development Report 2023 , UNCTAD, October 2023

The focus of the report is on proposals for reform of the international financial architecture, including through systemic reforms to the global debt architecture; regulatory responses to instability in commodity markets; and measures to scale up financial resources to align development and growth with the climate crisis,

Building Circularity into Nationally Determined Contributions: A Practical Toolbox , UNEP, UNDP, and UNFCCC secretariat, October 2023

UNEP’s One Planet network, UNDP, and the UNFCCC Secretariat developed this practical toolbox to support countries to identify, prioritize, implement, and track circular economy interventions for increased ambition and implementation of their nationally determined contributions.

World Economic Outlook: Navigating Global Divergences , IMF, October 2023

The latest World Economic Outlook finds that global recovery remains slow, with growing regional divergences and little margin for policy error.

Global Sustainable Development Report 2023 , UN, September 2023

The GSDR 2023 highlights key transformations needed in different sectors and provides key findings from the literature, practical examples, and tools for progress towards achievement of the SDGs.

Villars Framework for a Sustainable Global Trade System , September 2023

This report, generated through consultations with a broad base of scholars, researchers, and other thought leaders, seeks to respond to the need for fresh thinking, careful analysis, and thoughtful reform of the global trade system for sustainability.

World Trade Report 2023 , WTO, September 2023

This year's World Trade Report makes a case for re-globalization and examines the risks of fragmentation of the multilateral trading system.

The Ocean as a Solution to Climate Change: Updated Opportunities for Action , High Level Panel for a Sustainable Ocean Economy, September 2023

This report finds that full implementation of ocean-based climate solutions that are ready for action now could reduce the “emissions gap” by up to 35% on a 1.5°C pathway in 2050.

Priorities for an Equitable Reform of the Global Financial System , The African Climate Foundation, August 2023

This paper draws on a series of policy and reform proposals from African leaders. It builds on initiatives emerging from the Global South and puts forward a set of recommendations, reflecting Africa’s priorities in advancing equitable reform of the international financial architecture.

Using Trade Tools to Fight Climate Change , Jennifer Hillman and Loriane Damian, August 2023

In this book, the authors bring together a series of contributions that examine how the trade and climate regimes operate and how greater coordination between both regimes can be harnessed to address the climate crisis.

Copernican Revolution or Green Protectionism? , Timothy Mayer, August 2023

This book chapter argues that the quest nations are on today is not for trade policies that promote sustainability in the least trade restrictive way possible. Instead, they are looking for policies that can generate the political support to address urgent environmental crises while still promoting economic growth.

Going Circular: How the Harmonized System Codes Can/Not Support a Circular Economy and What Else Could Be Done , Jack Barrie and Gael Grooby, August 2023

This report reviews the relevance of the World Customs Organization harmonization system of codes to efforts to promote a circular economy and options for updates that could play a supportive role.

Border Carbon Adjustments: Priorities for International Cooperation , Ieva Bar?auskait? and Alice Tipping, August 2023

This IISD policy brief looks into some of the pertinent design elements of border carbon adjustments that might be fruitful subjects of international discussion about the best ways forward.

Our Quarterly Graph

Principles of International Law Relevant for Consideration in the Design and Implementation of Trade-Related Climate Measures and Policies

Our quarterly graph is taken from an International Legal Expert Group report by TESS on Principles of International Law Relevant for Consideration in the Design and Implementation of Trade-Related Climate Measures and Policies. It reviews a set of recognized principles of international law that the expert group deems especially relevant for consideration in the design and implementation of trade-related climate measures and policies. Shared understandings around such principles could facilitate cooperation on inclusive trade policies that support climate action and advance sustainable development.