A pro-development green trade agenda for COP-28

This year's string of extreme climate events highlights the escalating impacts of a warming planet. With the Global Stocktake Report (GST) underscoring the misalignment of global emissions with the Paris Agreement goals, the pressure to agree on ambitious climate action going into the 28th United Nations Climate Change Conference (COP28) has never been higher. Notably, COP28 marks a historic milestone with its inaugural "Trade Day," recognizing the pivotal role of trade in climate solutions. While trade bears the potential to advance climate and environmental goals, certain trade-related climate measures present challenges, especially for vulnerable developing countries. Given the inclusion of trade matters in the COP28 program, this year's climate conference holds the potential to advance international dialogue and cooperation on the trade-environment-development nexus (the “triangle”).

Building upon the authors’ previous publication (“EU trade and the Environment: Development as the Missing Side of the Triangle”), this paper revisits and expands the “triangle” framework to the global level. With the objective to put forward development-friendly approaches to climate mitigation policies, the authors apply the framework to two case studies: i) harmonization of carbon pricing and border carbon adjustment (BCA) mechanisms; and ii) trade in transition materials crucial to achieving decarbonization targets. Through the framework's application, the paper unveils the intricacies, and inevitable trade-offs, of addressing multiple objectives concurrently, offering actionable insights into achieving climate, environmental, and development goals via sustainable international trade policies.