By Hon. Prof. Kariuki Muigua, OGW, PhD, C.Arb, FCIArb is a Professor of Environmental Law and Dispute Resolution at the University of Nairobi, Member of Permanent Court of Arbitration, Leading Environmental Law Scholar, Respected Sustainable Development Policy Advisor, Top Natural Resources Lawyer, Highly-Regarded Dispute Resolution Expert and Awardee of the Order of Grand Warrior (OGW) of Kenya by H.E. the President of Republic of Kenya. He is The African ADR Practitioner of the Year 2022, The African Arbitrator of the Year 2022, ADR Practitioner of the Year in Kenya 2021, CIArb (Kenya) Lifetime Achievement Award 2021 and ADR Publisher of the Year 2021 and Author of the Kenya’s First ESG Book: Embracing Environmental Social and Governance (ESG) tenets for Sustainable Development” (Glenwood, Nairobi, July 2023) and Kenya’s First Two Climate Change Law Book: Combating Climate Change for Sustainability (Glenwood, Nairobi, October 2023), Achieving Climate Justice for Development (Glenwood, Nairobi, October 2023) and Promoting Rule of Law for Sustainable Development (Glenwood, Nairobi, January 2024)*
Trade has been identified as one of the tools and sectors of the economy that can spur climate action. According to UNCTAD, trade-related measures can help drive both climate and sustainable development actions across the globe. Some of the key trade policy instruments that can spur climate action include trade liberalization, standards and labelling, international investment protection treaties, and technology transfer. However, the efficacy of these instruments in climate action is hindered by several barriers including challenges to technology transfer, concerns about the methodologies adopted in developing standards and labels, and lack of reform of International Investment Agreements.
Trade has an important role to play in the global response to climate change, providing economies with tools to draw on in their efforts to mitigate climate change and to adapt to its consequences. Trade plays a fundamental role in helping countries transition to low carbon economies. It has been rightly observed that in order to effectively confront climate change, to provide all people with clean and affordable energy and to reduce dependency on fossil fuels substantially, both developed and developing countries will have to restructure their economies to low carbon economies. For this profound restructuring to happen, major investments in low carbon technology are needed, in addition to significant changes in life styles.
It has been observed that this process of technological innovation or dissemination of low carbon technologies will largely depend on international trade and investment of both private and public actors. As a result, international trade can favour the pursuit of climate change goals. According to UNCTAD, trade-led development can bolster climate action using coordinated and inclusive approaches to accelerate a global just transition to a low-carbon economies. It further asserts that trade can be a powerful tool to accelerate the energy transition and support resilient development pathways with low emissions.
In addition, trade can facilitate access to environmentally preferable goods and services and to technologies and know-how critical to boosting innovation and building capabilities to support climate change mitigation and adaptation efforts in all countries. It has been asserted that clean technologies are at the heart of Sustainable Development and the global response to climate change. Trade is a major factor in fostering access to clean technologies.
According to the World Trade Organization (WTO), trade and trade policies, in conjunction with relevant policies and international cooperation, can help to alleviate some of the impacts of climate change, including on food security, by contributing to enhancing economic resilience. WTO further posits that international trade can help support climate change strategies, such as prevention and reduction of, and preparedness for, climate risk, as well as recovery and rehabilitation from climate disasters. In addition, trade can also contribute to strengthening food security during climate-induced supply-side disruptions. WTO also points out that trade can facilitate the acquisition and deployment of technologies that can contribute to climate change adaptation especially in countries most vulnerable to climate shocks.
Trade can also contribute to climate action through the reduction of traderelated emissions. It has been observed that trade-related emissions, those associated with the global production and distribution of goods and services, contribute to roughly a quarter of all carbon dioxide emissions. Therefore, trade policies and instruments are needed in order to reduce trade-related emissions towards enhancing the global response on climate change.
The role of trade in climate action is recognized under the United Nation’s 2030 agenda for Sustainable Development. The agenda identifies international trade as an engine for inclusive economic growth and poverty reduction, and contributes to the promotion of Sustainable Development across all the Sustainable Development Goals including climate action. SDG 17 seeks to accelerate international trade through measures such as promoting a universal, rules-based, open, non-discriminatory and equitable multilateral trading system under the WTO; and providing trade-related capacity building for developing countries in order to enable countries pursue the Sustainable Development agenda including climate action.
At the continental level, the African Union Climate Change and Resilient Development Strategy and Action Plan acknowledges the role of trade in climate action. It points out that there is potential for the African Continental Free Trade Area (AfCFTA) to enable Africa’s response to climate change through targeted trade-related measures. These measures include the exemption of environmental goods and technologies such as turbines and photovoltaic systems from sensitive and exclusion lists; prioritisation of the liberalisation of trade in environmentally related services; giving due attention to the harmonisation and strengthening of environmental standards and regulation under the relevant provisions of the AfCFTA Protocol on Trade in Goods and Protocol on Trade in Services as well as within the framework of the African Quality Standards Agenda; and the mainstreaming of climate friendly considerations into the negotiations on investment, intellectual property rights, competition policy and e-commerce.
At the regional level, the East African Community Climate Change Policy Framework also recognizes the role of trade in climate action. It urges member states to address technology transfer barriers, including rules of trade tariffs, intellectual property rights and technical trade barriers such as standards, ecolabeling in order to enhance the role of trade in climate action within the East African region. At the national level, the National Climate Change Framework Policy of Kenya focuses on the link between sustainable national development in Kenya and climate change across all sectors of the economy including trade. According to the Policy, a robust, diversified and climate resilient trade sector is imperative for Kenya to attain low carbon climate resilient development.
The Policy acknowledges that the trade sector depends on products and services developed by other sectors of the economy, and therefore any adverse climate change impacts of such sectors, will likely impact trade. For example, the Policy acknowledges that the agriculture, manufacturing and transportation sectors, which are key cogs for internal and international trade, are highly vulnerable to climate variability and extreme weather events. Therefore, according to the Policy, a successful trade sector will require building resilience across the entire economy of Kenya. Trade is therefore vital in climate action. There is need to embrace trade policy instruments at the national, regional, continental and global levels in order to strengthen the response towards climate change.
*This is an extract from the Book: Promoting Rule of Law for Sustainable Development (Glenwood, Nairobi, January 2024) by Hon. Prof. Kariuki Muigua, OGW, PhD, Professor of Environmental Law and Dispute Resolution, Senior Advocate of Kenya, Chartered Arbitrator, Kenya’s ADR Practitioner of the Year 2021 (Nairobi Legal Awards), ADR Lifetime Achievement Award 2021 (CIArb Kenya), African Arbitrator of the Year 2022, Africa ADR Practitioner of the Year 2022, Member of National Environment Tribunal (NET) Emeritus (2017 to 2023) and Member of Permanent Court of Arbitration nominated by Republic of Kenya. Prof. Kariuki Muigua is a foremost Environmental Law and Natural Resources Lawyer and Scholar, Sustainable Development Advocate and Conflict Management Expert in Kenya. Prof. Kariuki Muigua teaches Environmental Law and Dispute resolution at the University of Nairobi School of Law, The Center for Advanced Studies in Environmental Law and Policy (CASELAP) and Wangari Maathai Institute for Peace and Environmental Studies. He has published numerous books and articles on Environmental Law, Environmental Justice Conflict Management, Alternative Dispute Resolution and Sustainable Development. Prof. Muigua is also a Chartered Arbitrator, an Accredited Mediator, the Managing Partner of Kariuki Muigua & Co. Advocates and Africa Trustee Emeritus of the Chartered Institute of Arbitrators 2019-2022. Prof. Muigua is a 2023 recipient of President of the Republic of Kenya Order of Grand Warrior (OGW) Award for his service to the Nation as a Distinguished Expert, Academic and Scholar in Dispute Resolution and recognized among the top 5 leading lawyers and dispute resolution experts in Band 1 in Kenya by the Chambers Global Guide 2024 and was listed in the Inaugural THE LAWYER AFRICA Litigation Hall of Fame 2023 as one of the Top 50 Most Distinguished Litigation Lawyers in Kenya and the Top Arbitrator in Kenya in 2023.
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