Linking Climate and Trade: A Long Way to Go for the EU and Its Trade Partners

Written by | Tuesday, October 9th, 2018

France is lobbying for making the Paris Agreement on climate a prerequisite to signing free trade agreements with the European Union. However, the idea of French President to make the compliance with the Paris deal a precondition to trade is having difficulties finding support across the bloc. “The government has laid down that non-compliance with the Paris Agreement can justify the suspension of a trade agreement or recourse to arbitration,” noted Sandrine Gaudin, the Secretary-General for European affairs (SGAE) of the French National Assembly.


A year ago, the French government set out to address the concerns around the EU-Canada free trade deal – CETA – especially regarding environmental and social standards. However, a year into the efforts, progress is slow and the European capitals remain unwilling to link trade policy and climate, although the European Commission is receptive to the issue. Paris believes that all the other free trade agreement that are currently being negotiated should ideally include the obligation to comply with the Paris Agreement. However, in reality, neither the deal between the EU and Singapore, nor the one with the South American integration bloc Mercosur, speaks about the Paris Agreement as being binding.


“It’s a difficult subject in Brussels to ensure that the trade deals effectively contribute to raising social and environmental standards. We are struggling to convince others of the binding nature of the sections on sustainable development,” Mr. Gaudin acknowledged. The EU and Canada are currently working on the so-called “climate veto” that will make the interpretation mechanism binding. The idea of “climate veto” was meant to ensure that the regulations and law aiming to combat climate change could not be challenged by investors and other stakeholders before an arbitration tribunal.

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