Trade and Climate Change (debate) 
President
The next item is the report by Alain Lipietz, on behalf of the Committee on International Trade, on trade and climate change.
Alain Lipietz
rapporteur. - (FR) Madam President, Commissioner, ladies and gentlemen, this is quite an important report just before the Bali Conference.
We are aware that international trade is developing at twice the speed of gross world product. This means it is causing growth in the transport industry, one of the most prolific producers of greenhouse gases. It is also enabling the relocation of production, which can be good in terms of using workforces and applying wage regulations, but, given that it takes no account whatsoever of the cost of greenhouse gases produced by this division of labour, it may accelerate the production of greenhouse gases and climate change.
To give you just one set of figures: ships, which carry 40 times more freight than planes, produce only twice as much greenhouse gas, but we still use planes to transport our goods to optimise the production cycle. I therefore feel that, further to the Stern Report and the four reports by the Intergovernmental Panel on Climate Change, we should be aware that it is worth waiting half a day or even three more days for a product to arrive at its destination, rather than destroying our climate at a price the Stern Report estimates as 5 000 billion dollars.
Beyond this comment, the report makes an attempt to open up certain avenues. Obviously there are certain avenues relating to transport. We are pleased with the recent vote on the addition of the aviation industry to the European quota system. The report encourages reflection on industrial organisation to reduce the geographic scale of production chains - producing in closer proximity to the end user - and makes a number of proposals in relation to trade in environmental commodities.
What we are proposing, within the context of the WTO and the bilateral or bi-regional agreements - in other words, all the agreements we are currently negotiating - is to prioritise the assessment of the effects on climate change within the assessment made by these agreements of the environmental effects. We also suggest prioritising a considerable reduction in all tariff and non-tariff barriers - and here we are thinking about royalties in particular - that hinder trade in own goods and services which are the ones that can reduce the production of greenhouse gases.
All this must evidently be carried out within the most multilateral context, with the WTO if possible, in the absence of any bi-regional agreements currently being negotiated by Europe. We cannot, however, rule out the possibility that, after 2012, in the initial post-Kyoto phase, mankind will not have reached a unanimous agreement on the fight against climate change. In this case, Europe's decision to lead the fight against climate change will definitely hit some of its sectors. It will not hit all of them. In many cases, being the leader of the fight against climate change provides a competitive edge. In some cases, and here I am thinking specifically of the cement industry, this could pose enormous problems and could even lead to cement tourism. In that case, when all the possibilities of multilateral agreements have been exhausted, we suggest adopting the GATT's Article 20, in other words, border adjustment taxes to restore fair competition.
This, ladies and gentlemen, forms the basis of my proposals.
Stavros Dimas
Member of the Commission. - (EL) Madam President, ladies and gentlemen, we are grateful for the initiative of the Committee on International Trade in addressing issues relating to trade and climate change.
The report by Alain Lipietz is a useful source of policy ideas and proposals. We are pleased with this report, because it recognises the interconnectedness of the various aspects of the negotiations.
Climate change is a very serious issue which, essentially, affects all sectors, including trade. We must endeavour to define a mutually supportive and coherent policy. The European Union aims to facilitate trade, ensuring that it is viable and also that it contributes to other policies, such as the policy on climate change.
We welcome the fact that the report recognises the prospects for negotiation on environmental goods and services. We believe that this represents an important contribution by trade to the climate change targets. We hope to see progress on this issue during the current round of multilateral trade negotiations for the Doha Development Agenda. We are pleased about the recognition of the need for the environment agreement secretariats to acquire observer status at the World Trade Organisation, which is something we tried to achieve for the current round of trade negotiations. We are also pleased about the recognition of the contribution that can be made by our new free trade agreements to questions of climate change, through special provisions.
The links between opportunities for access to new markets, i.e. for increased trade flows, and policies on climate change, are obvious.
Environmental policies provide a strong incentive for technological innovation and promote economic performance. Scientific and economic data show very clearly that the benefits of containing climate change outweigh the cost of reduction policies.
The adoption of further measures to combat climate change may result in significant competitive advantages for producers in countries with restrictions on carbon emissions, because - in combination with other policies - it will lead to lower consumption of valuable resources, and to environmentally friendly technological innovation, for which the market access opportunities are increasing. In this way we shall arrive at a situation which benefits everyone, in terms both of competition and of the environment. We must continue to seek out further opportunities to strengthen the positive contribution made by trade policy towards combating climate change.
I note that the report includes in this context the issues of export credit, progressive elimination of trade subsidies with a negative impact on the climate, and the strengthening and broadening of market access for direct foreign investments. All these are interesting issues which we can discuss in greater detail.
We must also continue our efforts on sustainability criteria in relation to forestry products, deforestation and illegal tree felling.
To conclude, let me thank you once again for this valuable contribution to the discussion on climate change at a very important time, when we are only days away from the start of the Bali Conference on climate change, which we hope will provide the motivation for negotiations on an international post-2012 agreement.
Jens Holm
draftsman of the opinion of the Committee on the Environment, Public Health and Food Safety. - (SV) Madam President, it is high time that world trade faced up to its climate responsibility. Since 1990, world trade has grown exponentially. What is the result of this from a climate point of view? Obviously, increases in transport and emissions. Is it reasonable, for example, that the EU's livestock farmers should import millions of tonnes of soya from Brazil for the European meat industry, or that fish should be caught in Norway, shipped out to China for filleting and cleaning and then back to Europe for preservation? No, of course not!
Our excellent opinion gives us an opportunity to take concrete measures to deal with this. We demand that transport should bear its environmental cost. We want to disseminate green technology to the developing countries, for example, by making fundamental changes to patent and intellectual property rights. We want to abolish subsidies to dirty energy production. We want to have compulsory environmental certification of biofuels and we want all trade agreements to be assessed from a climate perspective. These are just a few examples from this excellent report. By achieving these things, we can ensure that world trade becomes part of the solution and not part of the problem.
András Gyürk
Draftsman of the opinion of the Committee on Industry, Research and Energy. - (HU) Thank you for the floor, Madam President. Commissioner, ladies and gentlemen, the connection between two of the themes discussed by the report before us are extremely topical. The connection between certain forms of trade and climate change is ever more obvious. It is indisputable that intensive international trade gives rise to numerous harmful consequences, including an increase in carbon dioxide emissions, while reducing plant habitats which absorb greenhouse gases. Despite all this, I am convinced that free trade is not in itself identical to environmental damage. The spread of trade and the international division of labour does increase production efficiency, over and above the negative effects. This can result in us consuming fewer energy sources in total.
Allow me, as the rapporteur for the Committee on Industry, to highlight three thoughts in this vein from the opinion prepared by our Committee. Firstly, it is essential that the commercial barriers to environmentally friendly technologies are removed as quickly as possible. Such action will require the European Union to take an active role in the international climate change negotiations.
Secondly, we must strive for the price of products in future to reflect harmful consequences that are not immediately noticeable, including impact on climate change.
Thirdly and finally, we feel that discussions of suitable depth on the relationship between trade and climate change are of primary interest to the Community. Rather more so since Europe can play a leading role in the export of green products and services to the world.
Ladies and gentlemen, as is also apparent from the above points, the members of the Committee on Industry are unanimous in their opinion that both removing barriers to trade and action against climate change can only be brought about with the broadest possible international collaboration. The discussions within the Committee have confirmed for us that, with regard to climate change, trade is not only the problem but also part of the solution. Thank you very much, Madam President.
Georgios Papastamkos
on behalf of the PPE-DE Group. - (EL) Madam President, ladies and gentlemen, the Union must take a leading position - as to a large extent it has succeeded in doing - in the adoption of environmentally friendly policies. In this respect, your own contribution, Mr Dimas, has been substantial. The adaptation of all sectoral strategies to sustainable development models is, in any case, a primary regulatory target.
The strengthening of international trade is considered to contribute to world economic development and indeed to benefit not only the developed but also the developing countries. The rapidly increasing volume of cross-border trade flows, however, is a challenge to climate policy. The limits of the mutually supportive or antagonistic relationship between the world trading system and policies on climate change are the subject of the report we are discussing. Unfortunately, an imbalance can be seen in the report between the commercial and the environmental component. The rapid development of international trade ought to be treated exclusively as a factor causing environmental stress. Furthermore, the adoption of climate policies is not, in itself, enough; there is a need for a coherent overall plan reflecting environmentally friendly preferences in the policies on transport, trade, industry, energy and agriculture. In any case, the Union's effort alone is not enough to combat climate change. The Union's world lead in establishing models of environmental and social protection must be continued and promoted in its trade relations with countries outside the EU.
Ladies and gentlemen, the motion for a resolution contains some key points. The Group of the European People's Party and European Democrats has decided that a final vote in favour of the motion should be dependent on the outcome of the votes on these points.
David Martin
on behalf of the PSE Group. - Madam President, when it comes to climate change, trade is often seen as part of the problem, and it is true that some trade simply cannot be justified. Sending Scottish prawns to Thailand to be peeled and returned to Scotland is just nonsense, and a waste of energy. However, as Mr Lipietz's well-argued report demonstrates, trade can also be part of the solution. I will take just three brief examples.
Firstly, the setting of high energy-efficiency standards in Europe for household goods such as fridges, dishwashers, microwave ovens and so on can not only lead to a reduction in CO2 emissions here, but also create the conditions for higher standards elsewhere. For example, a single factory in China produces 80% of the world's microwave ovens. It is unlikely to want to produce to one standard for Europe and another for elsewhere in the world, or even, for that matter, for its domestic market.
A second example mentioned by the Committee on Industry is green goods or, to use their proper name, environmental goods and services. If we eliminate the tariffs on environmental goods and services, we can encourage trade in products that help third countries reduce their carbon footprint, such as the export of energy-efficient generators, wave technology and solar panels. Let us again take the example of China. China is currently increasing its electricity-generating capacity every year by the equivalent of the UK's total capacity. Clearly, encouraging China to use the latest and most efficient technology could play an important part in allowing it to continue its growth without experiencing a proportionate increase in its carbon footprint.
A third and final area would be to empower consumers to make informed choices on what products they buy, through the provision of clear information on the carbon footprint of each product. However, we must be careful to ensure that the information is properly calculated and presented. The 'food miles' labels currently used by some UK supermarkets are unsatisfactory and can give misleading information. Flowers from Kenya, for example, have a much smaller carbon footprint than flowers grown in hothouses in Holland, but a glance at the label would lead one to a different conclusion.
Zbigniew Krzysztof Kuźmiuk
Madam President, as I take the floor on behalf of the Union for Europe of the Nations Group in this debate on the impact of world trade on climate change, I should like to draw attention to the following matters.
Firstly, as a world leader in efforts to combat climate change, the European Union is calling for a reduction of between 25% and 40% in global greenhouse gas emissions by the year 2020. It should be borne in mind, however, that if the European Union achieves these emission reductions mainly as a result of its own action, with little contribution by other countries, the European Union's economic development might be threatened.
Secondly, economic entities that are subject to various restrictions in Europe as part of the effort to reduce greenhouse gas emissions can no longer compete with entities operating in countries where no such restrictions apply. Many sectors and types of production have ceased to exist in Europe due to unfair competition from producers in South-West Asia and South America.
Thirdly, following the introduction of restrictions relating to excessive greenhouse gas emissions on the territory of the European Union, we have witnessed the relocation of manufacturing outside Europe, where no such restrictions exist. As a result, many jobs in Europe will be lost forever.
Fourthly, if no agreement on limiting greenhouse gas emissions is reached at global level, and the European Union is determined to move forward on its own, compensatory taxes should be imposed at the Union's border. This should apply in particular in those sectors in which competition is already seriously affected as manufacturing costs have not taken account of environmental costs. Whenever possible, the so-called climatic dimension of trade exchange must also be taken into account in bilateral trade exchange agreements between the European Union and third countries.
The same arrangements should apply to ventures supported by the European Investment Bank. In the case of support by different types of undertakings, these arrangements should also be implemented by national agencies charged with guaranteeing export credits and direct investment.
Graham Booth
on behalf of the IND/DEM Group. - Madam President, Al Gore claims that the debate on global warming is over and that it has been proved beyond doubt that human activity is responsible for this.
I suggested recently in committee that the sun's enormous influence on the earth's climate over millions of years could not be ignored in this debate, and that the sequence of long ice ages, interspersed with short interglacial periods, was the most likely explanation. I received a very hostile reception.
However, the chairman, Mr Markov, insisted that it was not appropriate to urge excision of a view that happened to conflict with current orthodoxy. Let us remember that, when Galileo declared in the 17th century that the earth revolved around the sun, he was threatened with torture by the Catholic Church for daring to contradict the accepted fact that the earth was at the centre of the universe. It took the church until 1992 to agree that Galileo had been right.
The only CO2 at issue in the global warming debate is the trivial amount produced by burning fossil fuels. That comparatively small amount is the only modern and unusual addition to the vast quantities constantly being produced by all living things and all decaying organic matter, and through volcanic activity.
Before we risk ruining the world's economies with carbon emission taxes and the like, please let us reopen the debate and make absolutely sure who is right.
Daniel Caspary
(DE) Madam President, honourable colleagues, as we deal with this draft report, we should concentrate on the real issue, namely trade and climate change.
Unfortunately, in his first draft, the rapporteur did not manage to produce positive economic and socially compatible proposals as to how we can tackle this problem. In my view, there is far too much confusion, both by the rapporteur and in the report itself, between the issue of trade and the issue of transport. It is not world trade that is the problem, nor the worldwide division of labour; and nor is the problem the fact that thanks to trade, regions that have been or are still poor are now experiencing economic growth. No, our problem, surely, is that transport is not efficient and ecologically friendly enough. Our problem, surely, is that due to poverty or low levels of prosperity in some regions of the world, many people and countries cannot afford the climate protection that is necessary and makes ecological and economic sense.
It is only by integrating these regions into world trade that we will achieve a situation in which these people can afford environmental and climate protection. If you face a daily struggle for survival, you are not going to be thinking about environmental or climate protection. It is only through well-functioning world trade that we will be able to sell our modern technologies around the world and thus make a contribution to protecting the climate.
That is why, in my view, it is more trade, not less trade, that is the proper response to the problems of trade and climate change.
I am therefore most grateful to my colleague Georgios Papastamkos for being able to introduce numerous important themes into the committee debate, and I am most grateful that the ALDE Group has tabled various amendments for tomorrow's plenary that move in this direction.
I would like to conclude with a request. In this report, we unfortunately have several points where we have discredited our social market economy. We should find a way to remove these outbursts against our economic system, which has brought prosperity and social security to so many people. I would be grateful if the groups could show some creativity here so that our Group can also vote for this report.
Elisa Ferreira
(PT) I must start by congratulating the rapporteur on his detailed work on such a complex issue as the relationship between trade and climate change. Europe has been a global leader in the fight against the worsening of climate change. However, in order to be credible and achieve the proposed objectives, it must reinforce the coherence of its various policies on this issue. In particular, a European trade policy, one of the oldest common policies of the Union, must not and cannot be forgotten. This balance between environment and trade is not easy to achieve and is not being sufficiently achieved, particularly within the World Trade Organization.
In the European Union, meeting the climate change objectives requires an effective effort to reduce carbon emissions which will in turn impact on the conditions of production and the respective costs of an increasing number of productive sectors. It is time to ask ourselves whether, in a world of global competition and faced with the problem of the planet's survival, it makes sense for this effort to combat climate change to be, more than anything, a European effort? Is it acceptable for the emissions of so many sectors to be moved away from European soil to areas of the globe which are environmentally less protected? Can environmental violation be a legitimate source of competitiveness? Is it acceptable for different environmental compliance rules to exist for the main tradable goods at world level depending on the area of the globe where they are produced?
I think not with regard to all these questions. We need to find a balance between the environment, including climate change, and trade which will guarantee a collective, proportional and equitable effort, without excluding anyone, particularly not the main global trade partners. A new balance between the development of the vast impoverished areas of the globe and the planet's survival must be quickly found through dialogue, mutual respect and determination faced with converging objectives. The effort must be global and we can only hope that, in December in Bali, this process will begin in a serious and committed manner.
Stavros Arnaoutakis
(EL) Madam President, Commissioner, ladies and gentlemen, it is true that commercial transactions at European and global level have increased significantly in recent years. While this development encourages the economic development of nations, it has a significant impact on climate change. I am therefore expressing, on my own account, my concern about this particular problem. We need to decide how trade policy can contribute positively towards solving the problem of climate change.
The target we have set for a 20% reduction in greenhouse gas emissions by 2020 is quite ambitious. I hope we will win this bet, because the cost of losing will be enormous. Here I would like to underline the Commissioner's contribution and congratulate him on all his initiatives and efforts in this direction.
Greater support and a greater effort are needed in the transition to means of transport which are more environmentally-friendly; the promotion of industry which is more climate-friendly; the development of new technologies and the creation of financial disincentives for activities with a negative impact on the climate; effective cooperation between the United Nations, the World Trade Organisation and the European Union; and ongoing consultation and the participation of civil society and non-governmental organisations operating in the environmental sector. The European Parliament has an important role to play. I hope the results of the Bali Conference, in December, will send the optimistic messages which we are all hoping for.
President
The debate is closed.
The vote will take place on Thursday, 29 November 2007.
Written statements (Rule 142)
Eija-Riitta Korhola  
in writing. - (FI) It is vital to mainstream climate policy for the fight against climate change to be productive. The report being considered is a valuable one indeed and inspires a very necessary discussion: trade policy must form a part of climate policy because growing trade is resulting in more greenhouse gases. On the other hand, trade policy is very specifically effective as a form of climate policy and may, therefore, be part of the solution.
First of all, trade policy has great value in the promotion of environmental technologies. International trade is one of the most effective tools for the transfer of technology transfer. The role of the World Trade Organization is an important one, because it is essential to remove tariffs on green goods and improve the rules on intellectual property. On the other hand, it is intolerable that the WTO still endorses distorting subsidies on fossil fuels, for example, thus obstructing the path to green technology.
For no very good reason the report makes much of the success of Kyoto. Kyoto is full of loopholes, which are in fact aggravating the situation. Unilateral actions distort competition and lead to carbon leakage. Moving emissions from one place to another is not cutting them. Besides, solidarity towards people in developing countries is not to cause their environment to be contaminated. Kyoto leads to environmental exploitation. Climate change is a global phenomenon through and through and calls for global solutions. A global emissions trading scheme with the compulsory commitment of all the industrialised countries and rising economies is therefore absolutely essential.
I completely sympathise with the concern expressed in the report about the fate of forests with the increase in trade. The EU needs to pay special attention to the risk posed by biofuels to forest sinks. The targets for renewable energy sources set by the Commission must not be allowed to accelerate climate change either.
