Global Warming and the World Trading System

Gary Clyde Hufbauer, Peterson Institute
Steve Charnovitz, Peterson Institute
Jisun Kim, Peterson Institute

Peterson Institute for International Economics, Washington, DC

March 31, 2009

The Institute hosted a discussion of the linkages between the coming United States and international policies on climate change and the world trading system, at the release meeting of its new book, Global Warming and the World Trading System, on March 31, 2009. Coauthors Gary Clyde Hufbauer and Steve Charnovitz offer in their book the first comprehensive analysis of the relationships between the world trading system and climate change policy. The book assesses the implications of the current WTO system for alternative approaches to curbing carbon emissions, offers a series of options for dealing with their trade aspects, and proposes a new Code of Good WTO Practice on greenhouse gas emission controls.

The Institute has undertaken a major series of studies on this set of issues [pdf] on the view that the evolving national and international responses to global warming, and their interactions with the world trading system, will lead to some of the most fundamental changes in the global economic architecture since the creation of the Bretton Woods system at the end of the Second World War. It is clear that national legislation in the United States and other countries must include a trade policy dimension to respond to domestic concerns to preserve a “level playing field” with international competitors. At the international level, mishandling of the issue could both generate new cross-border trade conflicts and scupper the climate change negotiations themselves by erecting new tensions between key countries.

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