JOB/GC/264/Rev.3  
 
18 November  2021 
(21-8716) Page: 1/2 
General Council  Original: English  
 
 
PROPOSED FOSSIL FUEL SUBSIDIES MINISTERIAL STATEMENT  
Revision  
The following communication, dated 18 November  2021, is being circulated at the request of the 
delegations of Chile, Costa Rica, the European Union, Fiji, Iceland, Liechtenstein, the Republic of 
Moldova, Montenegro, New Zealand, Norway, Switzerland , Tonga, the United Kingdom,  Uruguay  and 
Vanuatu . 
 
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FOSSIL FUEL SUBSIDIES MINISTERIAL STATEMENT  
We, the Mi nisters representing the following Members of the World Trade Organization (WTO): [ …] 
issue this statement at the WTO 's Twelfth Ministerial Conference (MC12):  
 
1. Recognizing  that inefficient fossil fuel subsidies encourage wasteful consumption, 
disadvantage renewable energy, and depress investment in energy efficiency, and that effectively 
addressing fossil fuel subsidies will deliver trade, economic, social and environmental benefits as 
well as release government funds to support a green and climate -resilien t COVID -19 recovery;  
2. Recalling  our Leaders' commitment to fossil fuel subsidy reform under the Sustainable 
Development Goal 12 (c) of the 2030 Agenda, and recogni zing that a growing number of World 
Trade Organization (WTO) Members have made further pledges under the auspices of the G20, G7, 
APEC and V20, and in the context of the Paris Agreement on Climate Change and the Addis Ababa 
Action Agenda on Financing for Development;  
3. Recognizing  that subsidies have continued to steadily increase in the past decade and were 
estimated at approximately USD 500 billion in 2019, and diverting funding from such subsidies will 
support a just transition towards a green, sustainable economy;  
4. Recognizing  that a phase  out of fossil  fuel subsidies would effectively contribute to the Paris 
Agreement objective of holding the increase in global average temperature below 2°C above pre -
industrial levels, and would continue towards pursuing efforts to limit the tem perature increase to 
1.5 °C above pre -industrial levels and will deliver lower climate -related global risks as outlined by 
the 2018 Intergovernmental Panel on Climate Change Special Report on Global Warming of 1.5°C;  
5. Further recognizing  the significant pot ential for a fossil  fuel subsidy phase  out to support the 
Paris Agreement goal of making public financial contributions consistent with a pathway towards low 
greenhouse gas emissions and climate -resilient development;  
6. Acknowledging  that accelerating the r eform of fossil fuel subsidies is therefore more urgent 
than ever; 
7. Considering  that sustainable development is a fundamental principle of the Marrakesh 
Agreement establishing the World Trade Organization  and that trade has been explicitly identified 
as a p owerful enabling force that is indispensable in progress toward sustainable development ; JOB/GC/264/Rev.3  
 
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  8. Confirming , therefore, that the World Trade Organization can play a central role in the 
reduction of trade and investment distortions caused by fossil fuel subsidies b y achieving effective 
disciplines on inefficient  fossil fuel subsidies;  
We have accordingly reached the following shared understandings:  
• We seek the rationali zation and phase out of inefficient fossil fuel subsidies that 
encourage wasteful consumption alon g a clear timeline and encourage the remaining 
WTO Members to join us in those efforts, recogni zing the substantial financial resource 
this could unlock globally to support the transition;  
• We recogni ze that reform needs to take fully into account the specific needs and 
conditions of developing countries and minimize the possible adverse impacts on their 
development  in a manner that protects the poor and the affected communities;   
• We will share information and experiences to advance discussion in the Wo rld Trade 
Organization aimed at achieving ambitious and effective disciplines on inefficient fossil 
fuel subsidies that encourage wasteful consumption, including through enhanced World 
Trade Organization transparency and reporting that will enable the eval uation of the 
trade, economic, and environment effects of fossil fuel subsidy programmes;  
• We will elaborate concrete options to advance this issue at the World Trade Organization 
in advance of MC13.  
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