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Book (stand-alone)Potential conflicts between agricultural trade rules and climate change treaty commitments.
The State of Agricultural Commodity Markets (SOCO) 2018: Background paper
2018Also available in:
No results found.Climate change – among its many other challenges – also affects the conditions of competition along the whole food value chain. This article posits that many mitigation and adaptation policies imply a differentiation between otherwise identical products but with different carbon footprints. Where imports are affected, there is a potential for trade frictions. The main issue appears to be a climate-smart treatment of like products with different (non-product-related) production and processing methods (ppm). Now that national governments start implementing their commitments under the Paris Agreement on Climate Change, they have to closely look at the trade and investment impact of their Nationally Determined Contributions (NDCs). The NDCs presently available remain silent on concrete measures involving product differentiation according to footprint differences, be it by way of border adjustment measures, subsidies, prohibitions, or restrictions. The non-discrimination principle enshrined in the multilateral trading system can be a problem for such differentiations. No climate-smart agricultural measures have yet been notified to the World Trade Organization (WTO). But several renewable energy programmes have been found to violate WTO rules. Potential problems could arise, for instance, from differentiating tariffs, import restrictions or taxes according to carbon footprint. Conditions of competition might even be affected by labels signalling products with a bigger (or a “climate-friendly”) footprint, or through subsidies and incentives compensating domestic producers subject to emissions reductions, prohibitions, and input restrictions. A second major problem lies in the way the Paris Agreement and the WTO address the Development Dimension. In the Paris Agreement, the Development Dimension is addressed by the notion of Common but Differentiated Responsibility (CBDR), leaving Parties free in terms of how they take development into account in their NDCs. On the other side, the Special and Differentiated Treatment (SDT) foreseen in all WTO agreements for developing country products and services appears incapable of dealing with the global impact of all emissions, regardless of their origin, or with the negative impact on developing country exports to climate-smart markets in developed countries. In conclusion, we suggest that a review of the climate-relevant trade and investment rules is necessary at the international level, involving climate, and agriculture and trade regulators, supported by scientific, economic and legal expertise. The purpose of this review is to avoid litigation jeopardising the implementation of the Paris Agreement. At the same time, such a review must be comprehensive, because the objective is to ensure maximum policy space for climate mitigation and adaptation without negatively affecting other countries, or unduly restricting trade and investment, especially in poor developing countries. Last but not least, this intergovernmental and inter-institutional review is urgent, because the results should provide as quickly as possible the legal security necessary for investors and operators, regulators, NDC developments and reviews, and international standard-setting processes. -
DocumentInitial Results of the Carbon Balance Appraisal on the Agriculture Technology and Agribusiness Advisory Services (ATAAS) Project in Uganda EX-ACT Software for Carbon-Balance Analysis of Investment Projects
Applied Work. EASYPol Module 119
2012Also available in:
No results found.Agriculture can play an important role in climate change mitigation while contributing to increased food security and reductions in rural poverty. The Ex-Ante Carbonbalance Tool (EX-ACT) can estimate the mitigation potential of rural development projects/programmes brought on by changes in farming systems and land use. This study presents and discusses the EX-ACT analysis performed on a multi-donorsupported (World Bank, EU, IDAD, GEF, Danida) project in Uganda (the Agricultural Technology and Ag ribusiness Advisory Services Project - ATAAS). Based on projected estimates, the impact of project activities on greenhouse gas emissions and carbon sequestration show that the mitigation benefits achieved through the adoption of sustainable agricultural practices (intensification of agricultural lands without deforestation, improved cropland and grassland management, soil and water conservation) can balance the emissions associated with the increase in inputs use and petrol consumption due to t he project. Three simulations have been carried out: first using the direct objectives of the ATAAS project; then reviewing the objectives of the project from a more pragmatic point of view; and finally reviewing the assumptions made to build the baseline scenario. The study shows possible synergies between mitigation and rural development goals, and puts forward possible options for the financing of proposed improvements. -
DocumentUsing Marginal Abatement Cost Curves to Realize the Economic Appraisal of Climate Smart Agriculture Policy Options
Analytical Tools. EASYPol Module116
2012Also available in:
No results found.The AFOLU sector (Agriculture, Forestry, Land Use) is directly linked with climate change issues, on an environmental aspect as well as on an economical and social aspect (food security). Yet, while there is a wide range of technical solutions, it is not immediately apparent which options deliver the most economically efficient reductions in GHG within agriculture. This is why methodologies such as a Marginal Abatement Cost Curves (MACC) have been developed over these past twenty years. MACC als o enables the comparison of the cost-effectiveness of mitigation options between different sectors (e.g. agriculture, power, transport, industry and domestic energy consumption). MACC has become a useful tool for policy makers to prioritize mitigation options. This paper aims at putting forward a methodology to use MAC-curves within the AFOLU sector. It especially targets policy planners and policy makers. The agricultural sector, also called agriculture or AFOLU, encompasses farm-based activiti es (crop production, livestock) as well as forestry and land use. It does not include the downstream agro-industry sector. The first part of these guidelines explains the methodology in order to assess the cost-effectiveness and the mitigation potential of technical practices in agriculture. It also underlines the limits of the MACC approach. The second part looks at a practical MACC analysis example, using the EX-ACT tool.
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