WT/CTE/W/260  
G/C/W/843  
 
4 April 2 024 
(24-2909) Page: 1/4 
Committee on Trade and Environment  
Council for Trade in Goods  Original: English  
 
  
UNDERSTANDING THE OPPORTUNITIES  AND CHALLENGES  OF THE G REEN TRANSITION : 
COHERENCE AND INTEROPERABILITY OF TRADE -RELATED CLIMATE MEASURES  
COMMUNICATION FROM THE UNITED STATES  
The following communication, dated 4 April 2024 , is being circulated at the request of the 
United  States . 
 
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1  THE NEED AND URGENCY FOR AN ENHANCED FOCUS ON TRADE -RELATED CLIMATE 
MEASURES  
1.1.  WTO Members are grappling with understanding the challenges and opportunities of the green 
transition  for their economies and citizens.  Most recognize the urgent need to take action to mitigate 
greenhouse gas emissions and adapt to climate change in order to help ensure a safe future for 
families and communities, good paying jobs for workers, and a health y planet for our and future 
generations.  WTO Members are considering and implementing policy measures that are appropriate 
to their specific political and economic circumstances.  It is encouraging that progress has already 
been made on transitioning to les s emissions -intensive economies.  However, significant work 
remains, and needs to be accelerated, if we are going to meet greenhouse gas (GHG) emission 
reduction targets and net -zero goals.  This was driven home by the first global stocktake under the 
Paris Agreement  in December 2023, which found that progress has been too slow across all climate 
actions.  
1.2.  Trade policy can play an important role in incentivizing decarbonization and reducing GHG 
emissions in our economies, spreading technological innovations th at enable lower - or zero -emission 
production and transport, and greening international supply chains.  Consequently, WTO Members 
are putting in place and implementing trade -related climate measures (TrCMs) at a growing rate.  
WTO Members have already notifie d through various WTO committees over a thousand  trade-related  
measures on climate change mitigation and adaptation, and thousands more environmental 
measures and regulatory policies that relate to climate change and environmental protection (such 
as ozone  layer protection and the protection of forests).  The pace of these environment -related 
notifications has accelerated in recent years.  Some of these measures and policies are explicit border 
measures, such as carbon border adjustment mechanisms that seek t o address "carbon leakage " 
stemming from domestic and regional emissions prices and regulations.   
1.3.  As these policies are implemented, WTO Members would benefit from conversations to 
understand latest developments and work on how to assess the effectiveness and impact, including 
on trade, of various TrCMs domestically and internationally.  These conversat ions, and experiences 
of individual  Members, will be important in understanding the practical effects of different TrCMs, 
both in terms of their effectiveness in mitigating greenhouse gas emissions  and their effects on 
existing trade patterns.  They may als o lead to a deeper and shared understanding of how different 
measures can be mutually supportive of common climate goals (e.g., aligning incentives) or when 
they may inadvertently act at cross purposes (e.g., mixed market signals).  The WTO is an important 
space for sharing these trade -related experiences and discussing how to maximize the effectiveness 
and coherence of various TrCMs for achieving Members ' climate ambitions, complementing important 
discussions and analytical work taking place in other fora.  WTO Members can also utilize the 
convening power of the WTO to engage with a wide group of international organizations, academics WT/CTE/W/260 • G/C/W/843  
 
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  and other experts, and private sector and civil society stakeholders to discuss relevant work they 
are undertaking and help WT O Members better understand and navigate these challenges  and 
opportunities.  
2  CONSTRUCTIVE WORK ALREADY UNDERWAY RELATED TO TRADE AND CLIMATE 
CHANGE  
2.1.  WTO Members have already undertaken significant engagement on trade and climate issues in 
the WTO, as well as in other multilateral and regional organizations.  This work provides an important 
foundation for understanding and sharing more robust information on TrCMs, and potentially for 
WTO Members to collaborate on mutually supportive solutions.   
2.2.  In 2020, WTO Members established a forum for open and exploratory discussions on trade and 
the environment, including climate change, through the Trade and Environmental Sustainability 
Structured Discussions (TESSD) . There are now 76 WTO Members participat ing in the TESSD, 
and discussions have included presentations by a number of international organizations working on 
climate -related issues, including in specific sectors such as steel, aluminum, and agriculture.  The 
TESSD also includes discussions on topic s that directly relate to climate change, including 
deforestation, circularity and the circular economy.  The United States supports the continuation of 
discussions under the TESSD and the valuable, informal incubation space it provides WTO Members 
to engag e and explore emerging environmental issues in an open and inclusive format.  However, as 
noted further below, it is important to harvest discussions that began in the TESSD, broaden them, 
and develop, where possible, concrete and practical policy options a nd tools that can support WTO 
Members ' needs.  
2.3.  In addition to the TESSD, WTO Committees, such as the Committees on Trade and 
Environment, Agriculture, Technical Barriers to Trade, Trade Facilitation, and others, have discussed 
TrCMs and the relationship be tween trade and climate.  Some of this discussion stems from the 
notification requirements of committees to which TrCMs have been notified, including to receive 
comments and other communications from other Members.  This provides an important transparency 
element that is helpful in understanding the breadth and diversity of WTO Members TrCMs.  Those 
notification requirements of the respective WTO Committees should be respected, and Members 
should engage in the committee discussions on them , even in cases where similar discussions are 
explored in the TESSD . 
2.4.  Beyond the WTO, there is a wide range of international organizations, private sector 
associations, and civil society organizations exploring trade -related aspects of climate change, many 
of them at the s ectoral level.  Among these workstreams are critical discussions and analysis around 
data and methodologies for calculating emissions intensity used in comparing carbon pricing and 
non-pricing approaches.  For example, the OECD 's Inclusive Forum on Climate M itigation Approaches  
is working on mapping mitigation strategies, estimating impacts on emissions, and exploring 
methodologies for calculating carbon intensities.  Others, like international standards bodies, produce 
turn-key international standards that ca n be used by Members to develop sound regulatory 
approaches.  
3  ELEVATING SPECIFIC WTO DISCUSSIONS ON TRADE AND CLIMATE AND IDENTIFYING 
PRACTICAL POLICY OPTIONS AND TOOLS  
3.1.  This broad range of trade -related climate discussions at the WTO and elsewhere is helpi ng to 
broaden the understanding among Members of the nexus between climate policies and trade. We 
believe there is now an opportunity to further utilize the platform of the WTO to "harvest " some of 
the more mature discussions and to identify and prioritize  newer workstreams to help inform 
Members ' decisions regarding practical, solution -oriented policy options and tools.  We firmly support 
the continuation of informal discussions under the TESSD as an open and exploratory forum for 
engaging on climate and ot her environmental issues.  Such a forum is needed for WTO Members to 
share views and experiences to inform discussions.  In fact, there are additional topics that could be 
considered for inclusion in the TESSD, for example, cross -cutting issues such as emplo yment and 
the green transition.  But we should also identify specific topics that are ripe for bringing 
back into the regular work of the relevant WTO committees, and deepen the discussion 
on those more mature areas with the goal of informing WTO Members in terested in 
developing data -driven, science -based, practical policy options and tools.   WT/CTE/W/260 • G/C/W/843  
 
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  3.2.  Specifically, there is general acknowledgement that greater coherence and interoperability 
between different TrCMs could improve their effectiveness in addressing clima te change, while also 
reducing unnecessary costs and trade tensions.  Given the urgency and need for WTO Members to 
take action to address climate change, and given their diverse political and economic situations, it 
would be helpful for WTO Members to have practical information on ways to design and implement 
measures to achieve maximum policy effectiveness.  
3.3.  Discussion and consideration of coherence and interoperability could potentially be considered 
at two levels:  
• Policy Design and Implementation: ho w different climate -related measures (such as carbon 
prices, regulatory requirements, and frameworks on emissions) vary and interact; and  
 
• Data and Methodology: at a more technical level, understanding of ongoing work and 
Member experiences in comparing d ata sources and methodologies for calculating embodied 
GHG emissions at the product, facility, or sectoral level.   
3.4.  Both of these areas have benefitted from discussions in the TESSD, as well as significant work 
by other international organizations, academic s and other experts, and private sector entities.  
Bringing this important foundational work forward for deeper dialogue will be important to inform 
the next stages of the discussion and potential outcomes.  
3.5.  We propose WTO Members consider a range of option s for deepening understanding 
in these two areas : 
A. WTO Member retreat(s) , with background briefs and materials provided in advance to 
focus the discussion, on the following themes:  
 
a. Interoperability of TrCMs : understanding ongoing work and Member experience s to 
identify common elements across different types of TrCMs, including on options and 
strategies to support interoperability and coherence among different measures.1 This 
would include discussion of interoperability between different carbon price and no n-
price measures and outcomes from the two approaches.  
 
b. Capturing embodied emissions : understanding ongoing work and Member 
experiences related to data and methodologies used for calculating embodied 
emissions.  
 
B. Thematic discussions in WTO committees and cross -committee work , as 
appropriate.  In addition to notifications of TrCMs to the a ppropriate committee(s) (depending 
on the type of measure), this could include discussions on how to advance compatibility 
across international standards, or discussions on how Good Regulatory Practices (GRPs) can 
improve the effectiveness and coherence of  TrCMs.   
 
C. Multi -stakeholder event(s)  focusing on the implementation of TrCMs: what have been 
the experiences and lessons learned to date of WTO Members; traders and exporters, 
including small and medium -sized businesses; labor organizations, community -based and 
environmental organizations, and other civil society members as TrCMs are implemented in 
practice? What have been the employment impacts or implications of various measures and 
how does this support just, green transitions? What are we learning about  the best ways to 
implement TrCMs in order to maximize reduction of GHG emissions, while minimizing trade 
frictions, especially for small businesses and developing countries?  
 
D. A compilation report , driven by participating WTO Members and with the support of the 
WTO Secretariat, that:  
 
a. Captures and shares the key insights from the above retreats, committee thematic 
discussions, and multistakeholder event(s);  
 
1 This discussion should take into account the TESSD paper "Best Practices in the Development of 
TrCMs " issued on December 21, 2023 ( INF/TE/SSD/W/25/Rev.3 ).  WT/CTE/W/260 • G/C/W/843  
 
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  b. Shares Member experiences and lessons learned in promoting coherence and 
interoperability of  TrCMs;  
c. Takes stock of various existing efforts to identify key elements of major types of 
TrCMs in order to help WTO Members compare and contrast different aspects of 
climate -related policy measures; and  
d. Identifies gaps in existing factual or analytic wo rk that the participating WTO 
Members may find useful.  
3.6.  The intent of this communication is to recognize that WTO Members are already designing and 
implementing TrCMs to respond to the climate crisis, and that a great deal of important discussion 
and analys is has already taken place at the WTO and elsewhere.  The time is ripe to pull some aspects 
of this work into a deeper discussion that is data - and fact -driven and could help inform WTO 
Members considering practical policy options and tools to address clima te change while recognizing 
potential trade -related impacts.  This communication provides ideas on the topics and processes to 
do this work in an open and transparent way in the WTO.  We welcome further engagement and 
refinement from all WTO Members on how b est to achieve these goals.  
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