In confronting climate change and other environmental challenges, U.S. businesses are focusing attention on sustainability as never before. In the trade lane, a number of challenges and opportunities are clear.
According to the Office of the U.S. Trade Representative, global trade in environmental goods exceeds $1 trillion annually. This includes such products as catalytic converters, clean-running turbines, and products to control air pollution and treat wastewater—in sum, technologies that help keep clean the air we breathe, the water we drink, and the land we farm. However, some countries apply tariffs as high as 35% on environmental goods, discouraging their use. On several occasions during the past two decades, proposals have been made at the WTO for a multilateral trade agreement to eliminate tariffs on these goods. The Chamber supports negotiations for such an agreement.
In addition, the Chamber supports measures protecting and promoting the use of remanufactured goods in trade agreements. International trade in such goods creates incentives for investment in sustainable value chains and waste reduction. Companies should be allowed to compete internationally based on their life cycle product management, and remanufacturing helps reduce operating costs by providing quality components and equipment at a fraction of the cost of a new product. New trade agreements such as the USMCA include commitments to ensure nondiscriminatory market access for remanufactured products that should be adopted worldwide to support sustainability.
Finally, overfishing and depletion of global fisheries is a widely recognized problem that is made measurably worse by extensive subsidies afforded to fishing fleets worldwide. Negotiations at the WTO for a multilateral agreement to limit those subsidies could ameliorate the problem of overfishing, but talks have dragged on for years. It is rare for the nexus between a possible trade agreement and a specific environmental problem to be so widely recognized, but converting goodwill into action has proven difficult. Governments must commit to concluding these negotiations at the next WTO ministerial, which will likely be held in 2021.