Using the WTO and the Trade System to Discipline Fossil Fuel Subsidies for Climate Mitigation

A recent IMF study places global fossil fuel subsidies at US$5.3 trillion, or 6.5 percent of global GDP. Among a range of negative societal effects, such subsidies boost greenhouse gas emissions and further spur climate change, undermining parallel efforts made by the international community. Political developments over the past few years, including in the G20, the G7, the United Nations Agenda 2030 and the Paris Agreement on climate change, show an increasing recognition of the need to put an end to these perverse subsidies. However, it has proven difficult to move from high-level declarations into concrete action. Trade policy, and more precisely the WTO, could play an important role in this regard. This session sought to shed light on the impact of fossil fuel subsidises on the environment and discussed if and how the WTO could become equipped to effectively discipline these subsidies. This session was organised under the E15 Initiative, in collaboration with the World Economic Forum, and was moderated by Ingrid Jegou, Senior Associate, ICTSD.

The biennial Trade and Sustainable Development Symposium (TSDS), held alongside the WTO ministerial conference for over a decade, is the leading multi-stakeholder platform for intellectual enquiry and dialogue on sustainable development and the global trade and investment system. The TSDS – organised by ICTSD in partnership with the Centro de Implementación de Políticas Públicas para la Equidad y el Crecimiento (CIPPEC), the Inter–American Development Bank (BID), Consejo Argentino para las Relaciones Internacionales (CARI) and Bolsa de Cereales with the support and collaboration of the Ministerio de Producción, Presidencia de la Nación, Argentina – acts as an inclusive platform outside of the WTO negotiating setting for sharing ideas, engaging in dialogue, and influencing trade policy negotiations. Drawing in participants from government, business and civil society, the Symposium helps to maintain and elaborate a global vision of sustainable development in trade and investment policymaking.