Easier access to Clean-Tech Trade
“There is very little debate on the need for a new green-energy economy…It is the basis of the future economic prosperity in the global world. There is no disagreement” (Stavros Dimas, China Daily, 2009).
What is the Problem?
The Global South bear the brunt of greenhouse gas emissions that are largely produced by the Global North and are often forced to yield ground on development. Some leading Global South nations are facing costs of around 100 billion euros a year by 2020 - which is demonstrated by China, as the government has been elbowed into a more costly but environmentally-friendly pathway that the country has had to rely on new energy and ecology-savvy technology (www.chinaview.cn). China has been consistently promoting sustainable development despite numerous difficulties and is calling for technology used to reduce carbon dioxide, nitrogen dioxide and other greenhouse gases. Yet slow and slim technology transfer remains one of the biggest hurdles for their environmentally sound pathways.
What’s the idea?
Reducing harsh tariff barriers on clean technology will allow newly industrialising countries to implement sustainable and climate friendly technologies at a lower cost, which will help to prevent growing emission rates, and assist the developing economies of Newly Industrialising Countries (NICs) “It is imperative to ease transfer of technology between nations to save the world from the looming climate crisis that knows no borders” (China Daily, 22/09/2009, para, 1).
Who supports it?
How it works?
➢ Initially, it is essential that the price of fossil fuels be increased to allow for the environmental and health damage that they cause. This could be done through obvious means of either a carbon tax or levy, or by emission permits with cap and trade. This will create a domino effect and shift the global demand towards clean technologies.
➢ China and other developing nations could use the flexibilities of the Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS) such as limiting patentability and compulsory licensing. Certain technologies, especially those deemed necessary to tackle climate change, could be excluded from patent grants. However the fight against global warming would gain most if nations hammer out amendments to TRIPS and other IPR pacts that could waive or reduce technology transfer costs in the climate change context just as in public health sector.
➢ It’s a simple concept really: Stimulating business development in the clean tech sector, stimulates economic growth that will help reinvigorate the destabilised countries due to the economic crisis, help stimulate NICs, create thousands of new jobs and help the environment.
➢ On a small scale the revenue raised through increased taxes on carbon emissions, could be returned to the community in the form of funding to assist the creation of the new cleaner energy industries. With enhanced energy efficiency, there is no need for energy bills to rise.
Where has it been tried?
The EU uses its trade policy to support measures that cut greenhouse gas emissions. Under the terms of the EU's ‘Generalised System of Preferences’ developing countries that have ratified and implemented global environmental agreements can receive special tariff rate cuts when they export to the EU. As part of the Doha WTO trade negotiations, the EU has pushed for more open trade in environmental goods and services such as renewable energy products, wastewater management and energy efficient construction services to encourage the spread of these new technologies around the world. This would strengthen the freedom of choice of developing countries to choose the specifics of their development strategies according to their own needs and priorities, as required by the goal of sustainable development.
According to EU Environment Commissioner Stavros Dimas, consuming more time by waiting to implement sustainable policies will be more costly. He announced that the 15 billion euros (US$22.1 billion) assistance for poor countries to battle climate change, "will only get higher if we delay” (China Daily, 2009), which verifies that action is needed to be taken now and through trade agreements with NICs the lowering of tariffs on environmentally efficient technologies will facilitate a movement towards a new global market focusing on renewals and clean technologies.
Can it be implemented in Australia?
The recent bilateral agreement between Australia and Thailand could be a potential platform to implement this clean-tech strategy. Many Asian countries are pursuing bilateral trade and economic agreements. It is hoped by developing countries that bilateral free trade agreements (FTAs) can provide benefits such as preferential terms for exports for their products, an improved investment climate for foreign investment, and easier access of environmentally sustainable technologies.
A recent finding in relation to clean-tech trade shows that this new wave of interaction between developed and developing nations is taking hold, exemplified through the development of the trilateral Security and Prosperity Partnership (SPP) which was launched in 2005. The SPP involves the United States, Mexico, and Canada and through this body, the three participating countries have formed a North American Competitiveness Council (NACC) to provide recommendations on developing competitive industries in the region. Their goal is to cooperate on clean-energy technologies, energy conservation, and market facilitation to build greater energy security and sustainable development in the region. This validates a newly recognised global awareness of the need for economic reform through sustainable means (Migration Policy Institute, 2009) - (Sources: Department of Homeland Security; the White House, "Security and Prosperity Partnership of North America Prosperity Agenda")