EU Trade Policy Day, online 26 April 2021, offered policymakers and civil society representatives a chance to discuss how EU Trade policy should respond to global challenges such as the World Trade Organisation (WTO) stalemate and the climate crisis. Globally, 1,300 people registered for this inaugural trade policy day. Through discussions and polls, they made it clear that climate change must be the key concern of the global trade agenda, and that the most important trade enforcement priority should be the promotion of sustainability.
But how? Unless the asymmetric trade relationships between big players such as the EU and US and the global South are addressed at the multilateral level, it will be difficult to bring developing and emerging countries on board with initiatives to tackle climate change. WTO Director-General Ngozi Okonjo-Iweala reminded participants that “the WTO is about people and improving living standards of people, creating employment and promoting sustainability.” Several panellists stated that to deliver this vision, WTO core rules need to be reformed to respect the Paris Agreement and the Sustainable Development Goals.
James Thornton from ClientEarth explained that, at the bilateral level, the EU must recognise the climate and deforestation risks of its trade agreements, conduct robust impact assessments and include sustainability commitments with more teeth. EU trade is indeed a driver of deforestation, through its imports of forest-risk commodities. And things could get worse: The EU is currently negotiating trade deals with several highly forested countries, notably Indonesia, Malaysia, the Philippines and the Mercosur bloc. These trade agreements could contribute to increased deforestation and human rights violation.
Thornton added that Forest Law Enforcement, Governance and Trade Voluntary Partnership Agreements (FLEGT-VPAs) should be further supported and are a model from which to draw lessons for improving trade agreements, as they are grounded in partnerships, strengthening democracy and improving the rule of law. This call was supported by Member of the European Parliament Heidi Hautala, who said we should not throw away #FLEGT-VPAs, but rather build on them in order to accompany the upcoming EU Due Diligence rules (FW 262) with innovative trade agreements that support forest governance.
The European Commission did not give many details about its Trade and Sustainability review, and how it will address the challenges surrounding enforcement of sustainability. In contrast to comments about increasing enforceability of commitments, Sabine Weyand of DG Trade mentioned that if sanction-based mechanisms are explored, they should be a very last resort, used against partners unwilling to fulfil elements of trade agreements.
Fern and others are waiting to see how the Trade and Sustainability review, expected to take place later this year, will affect forests and civil society’s involvement in trade agreements.