The two-day formal meeting of the World Trade Organization (WTO) Committee on Trade and Environment ended on the 15th. During the meeting, various parties discussed the trade impact of environmental policies, and China's proposal to hold multilateral thematic discussions on the EU's carbon border regulation mechanism attracted wide attention from WTO members.
The Chinese proposal points out that trade policies are increasingly becoming a tool for countries to implement environmental policies, and the trade issues involved in some environmental policy measures have caused controversy. Some of these measures have been referred to the WTO dispute settlement mechanism, while others have been repeatedly mentioned in relevant WTO regular meetings and review mechanisms.
The Chinese proposal states that the WTO is an important venue for monitoring and reviewing trade policies. Trade policies aimed at achieving environmental goals should comply with the basic principles and rules of the WTO and avoid constituting protectionist measures and green trade barriers. The WTO should play a greater role in promoting environmental sustainability and preventing trade frictions through trade policies. In this regard, constructive multilateral thematic discussions by all parties are the first step in promoting multilateral cooperation.
The Chinese proposal calls for multilateral thematic discussions on the trade related content of environmental policies and their impact, using the WTO Committee on Trade and Environment as a platform, focusing on environmental policies and measures that have a wide range of impacts and high attention among members.
China proposes to hold a multilateral thematic discussion on the EU's carbon border regulation mechanism at the meeting of the Committee on Trade and Environment in June this year. China pointed out that the minutes of the regular meeting of the WTO Committee on Trade and Environment in October 2022 showed that the carbon border adjustment mechanism had appeared 58 times, indicating that many members were concerned about the issue.
WTO members such as Norway, the Philippines, Singapore, India, and Brazil stated that the Chinese proposal was constructive. India also stated that the Chinese proposal conforms to the mandate of the 12th WTO Ministerial Conference.
The European Council and the European Parliament reached a draft political agreement on a carbon border regulation mechanism at the end of last year. It is expected that formal legislation will be introduced in April this year, gradually taxing major industries such as cement, steel, aluminum, and fertilizer. Many WTO members believe that this is suspected of violating the most favored nation and national treatment principles of the WTO and the relevant principles of the Paris Agreement.
