WORLD TRADE  
ORGANIZATION  WT/L/717 
25 January 2008 
 (08-0372) 
 Original:   English 
  
 
CHAIR'S SUMMARY - INFORMAL TRADE MINISTERS  
DIALOGUE ON CLIMATE CHANGE ISSUES 
Jimbaran, Bali, 8-9 December 2007 
 
Communication from Indonesia
 
 
  The following communication, dated 22 January  2008, has been received from the Delegation 
of Indonesia with the request that it be circulated to Members. 
 
_______________ 
  
 With reference to the Informal Trade Minist ers Dialogue on Climate Change Issues held in 
Bali, Indonesia, on 8-9 December 2007, I have the pl easure to enclose herew ith the Chair's Summary 
as a result of the aforementioned dialogue.  As you might be aware, the dialogue was the first-ever 
informal meeting among trade Ministers, held in parallel with the 13
th Conference of Parties of the 
UNFCC, to discuss how best international trad e can support developmen t and climate change 
objectives. 
 
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CHAIR'S SUMMARY 
 
1. As the host of the UNFCCC COP 13, Indonesia took the initiative to host an informal 
dialogue of Trade Ministers on how best interna tional trade can support development and climate 
change objectives.  Trade Ministers, Vice Minist ers and Senior Officials from 30 countries had a 
fruitful two-day informal dialogue on the 8 and 9 De cember 2007.  The dialogue was held in parallel 
with the UNFCCC COP 13 meeting in Bali, to r espond to the growing global concern regarding 
climate change, while always being mindful of the sustainable development objectives.  Trade 
Ministers together with the relevant international agencies related to international trade, such as the 
WTO and UNCTAD, and invited resource persons, di scussed the inter linkages between international 
trade, development, and climate change.  Ministers viewed this first-ever  informal dialogue of Trade 
Ministers on climate change issues as indicative of the urgency and timeliness for the global trade 
community to further engage and build confidence in the ongoing global dialogue on climate change.  
2. Ministers recognized the importance of con certed multilateral efforts to address climate 
change issues for the future of sustainable deve lopment and the mutually supportive linkages between 
climate change, international trade and development.   Ministers noted with concern various scientific 
evidence showing the effect of gr eenhouse gases, mainly carbon emissi on, on accelerating the pace of 
climate change and the costs of inaction.  It was noted that developing countries were the most vulnerable to the effects of climate change and yet they have limited resources and technical capacity to address the challenges.  In this context, Mini sters realized that protecting and managing climate 
system for the benefit of present and future genera tions of humankind is a problem for all, and cannot WT/L/717 
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  be effectively undertaken partially or unilaterally.  International trade is also a global issue and needs 
to be dealt with multilaterally, whereas development is  a central pillar for both the climate change and 
international trade frameworks.  Ministers therefor e stressed that international trade, development, 
and climate change can be mutually supportive, an d there was a need to optimize current multilateral 
frameworks and their linkages and ensu re that the multilateral principles that exist in both the climate 
change and international trade frameworks are not undermined.  The multilateral consensus on the 
framework for climate change which will define th e targets, approaches, policies and instruments, 
based on the principle of the common but differen tiated responsibilities and respective capabilities, is 
needed for the international trade regime to respond positively to the climate change goals.  In the 
absence of a multilateral consensus on climate change and fundamentally the pricing and 
measurement of carbon, there is a risk that th e principles of non-discrimination, transparency, 
scientific and rules based standards, and special and differential treatment of the international trading 
system would be undermined. 
3. Ministers discussed the potential for conflict fro m the inter linkages of trade and climate 
change objectives and policies, which will hurt de veloping countries most because of the potential 
costs and impact.  Without proper understanding and an alysis of the way international trade impacts 
on the environment and climate change, the notion of carbon footprint and carbon miles can lead to 
distortions of trade flows and increased ineffici encies.  A plethora of standards and labelling 
requirements linked to climate change targets could develop, some of which are valid, but others will 
be difficult to verify without a multilateral con sensus.  Such a situation would impose excessive 
compliance costs beyond the capacity of small produ cers or developing countries.  Furthermore the 
absence of consensus on standards, could also lead to discriminatory practices and protectionism.  The 
idea of a carbon tax imposed at the border to o ffset competitive disadvantages caused by national 
differences in climate change targets could also lead to lack of certainty and potential protectionism in 
the absence of global consensus on climate change targets and uniform measures and pricing of 
carbon.  Therefore Ministers emphasized the importa nce and urgency to reach multilateral consensus 
for the post 2012 Kyoto Protocol Climate Ch ange Framework in the next two years. 
4. Ministers recognized the importance of ali gning environment objectives with global trade 
objectives, especially through improving understandi ng and empirical basis of the inter linkages 
between international trade and climate change.  Mi nisters generally agreed on the important role of 
international trade in global economic development and welfare, however there was a variety of views 
on how best trade can help countries to mitigat e and adapt to climate change, whilst keeping 
development objective in mind.  A variety of tr ade related policy options  and mechanisms were 
discussed as a possible way to meet the climat e change objectives . These included measures and 
management of carbon footprints;  reducing or el iminating barriers for environmental goods that 
mitigate and facilitate adaptation to  climate change;  the critical role of technology transfer for 
developing countries in mitigating and adapting to cl imate change objective;  role of IPR in ensuring 
accessibility and affordability of technology transf er for developing countries;  reducing or 
eliminating subsidies that have a dverse impact on climate change;  a nd developing an efficient market 
based trading regime.  A number of Ministers also emphasized the importance of opening up of markets for environmental goods and services of inte rest to developing countries such as sustainable 
forestry products and bio fuels.  It was stressed th at whatever policies or mechanisms implemented to 
combat climate change must be taken in such a way as to minimize adverse social and economic 
impacts, and in a manner that is compatible with in ternational trade rules so as it would not constitute 
a means of arbitrary or unjustifiable discriminations or a disguised restriction on international trade.  
More study and analysis will be needed to un derstand these inter-linkages and impact better. 
5. Ministers recalled the mandate given under the Marrakech Agreement and the Doha 
Declaration, to better mainstream issues related to the environment to the rules of the multilateral 
trading system.  It was recognized that addressing climate change through e nhancing the development 
and capacities in particular for developing countr ies was of equal importance to mainstreaming  WT/L/717 
 Page 3 
 
 
  environment to the multilateral trading system.  In this context, the contribution of multilateral trade 
regime to climate change would be the successf ul and balanced conclusion of the DDA (Doha 
Development Agenda) negotiations as soon as po ssible, including the implementation of the 
environment mandate.  The balanced conclusion of the DDA, combined with a package to facilitate 
the transfer of low-carbon or environmentally frien dly technology to developing countries, capacity 
building and Aid for Trade, would lead to a su stainable economic growth and poverty reduction, 
delivering a win for trade, a win for the environmen t, and a win for development.  To that end, 
Ministers saw the merit for the WTO and the UNF CCC to work closer through, among others, 
enhanced information exchange and other means of  cooperation, to address issues related to climate 
change that is compatible with the spirit of multilateral trading system. 
6. Ministers expressed that the time is right to pl ay a more active role in responding to climate 
change.  Ministers emphasized the need for a multilateral consensus on climate change for the 
multilateral trading system to respond effectively a nd prevent various risks to the trading system.  
Ministers also felt that greater political will and co mmitment will be needed from all parties to better 
understand, build confidence and trust, and to act in a way that will ensure that the international trade, 
development, and climate change objectives can be mutually supportive.  To that end, Ministers, 
recommended:   
– The successful and balanced conclusion of the Doha Development Agenda negotiations 
as soon as possible, including the environment mandate.  
 – More comprehensive study and better empi rical evidence on the linkages and interface 
between international trade, development a nd climate change, to enhance understanding 
and to enable Trade Ministers to take informed and more appropriate actions. 
 – Intensify high-level engagement and interac tion on the issue of international trade and 
climate change. This may include of holding high-level meeting on the issue of trade and 
environment under the WTO, or in parallel w ith other international meetings, such as 
UNCTAD XII. 
 – Encourage future hosts of UNFCCC COP me etings to hold similar Informal Trade 
Ministers Dialogue on the issue international tr ade and climate change, and to look at the 
possibility of holding a joint session with  finance and development Ministers. 
 
– Strengthen and enhance engagement between the WTO and UNFCCC through 
information exchange mechanisms with the view to better improve the mutual 
supportiveness of international trade and climate change objectives. 
 
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