Trade policy and the post-2020 global biodiversity framework

  • Mainstreaming biodiversity across economic sectors is a key issue to be discussed at the CBD COP15 in China in 2020, where the post-2020 global biodiversity framework is due to be agreed upon.

  • Trade policy can play an important role in fostering the protection of biodiversity, including via regional trade agreements or voluntary partnership agreements.

  • Further efforts are needed to align biodiversity and trade objectives so as to help achieve more sustainable outcomes – global cooperation will be critical in securing these outcomes.

With global biodiversity trends on the decline, and widespread recognition that significant further action and transformational changes will be needed to reverse these trends, the international biodiversity community is gearing up for the 15th Conference of the Parties to the Convention on Biological Diversity (CBD COP15), taking place in Kunming, China in October 2020.

Parties to the CBD are due to agree on a post-2020 global biodiversity framework. The CBD covers the conservation and sustainable use of biodiversity – species, and terrestrial, marine and other aquatic ecosystems – as well as the equitable sharing of benefits from the use of genetic diversity.

Mainstreaming biodiversity across sectors and policy areas – including agriculture, fisheries, forestry and trade – is recognised as a key issue that needs to be more effectively addressed in the post-2020 framework.

The relation between biodiversity and trade

Biodiversity is related to international trade in several ways. Some are connected to the impacts of legitimate trade while others are associated with illegal trade.  

Trade can facilitate the movement of invasive species. Biodiversity damages associated with the production of traded goods can be exacerbated by foreign demand. At the same time, export demand for sustainable goods can encourage better practices domestically. Trade in services and financial flows can also benefit investments in biodiversity.

A particularly important challenge is that of Illegal trade in environmentally sensitive goods, such as the products of illegal, unreported or unregulated (IUU) fishing, threatened wildlife, timber and hazardous waste. These issues have been longstanding in the international trade and environment agenda.

Illegal timber harvests and related trade supply 10–15%  of global timber, and up to 50% in certain areas, hurting revenues for state owners and livelihoods for the rural poor. Only 65% of surveyed OECD countries report fully functioning mechanisms allowing the use of trade information – for example sourced from customs authorities – to target the movement of IUU fishing products along the value chain.

Aligning biodiversity and trade objectives in trade agreements

To more effectively mainstream biodiversity in trade issues, it will be important for governments to integrate biodiversity objectives into their trade-related strategies and plans.

While few trade strategies do so adequately today, governments are giving increasing consideration to how best to ensure that their trade and biodiversity objectives are mutually supportive. One way to do this is via trade agreements: a number of recently agreed regional trade agreements (RTAs) include provisions to address biodiversity-related concerns among their trading partners.

According to Trend Analytics, out of 730 trade agreements signed between 1945 and 2018, 30 reaffirm multilateral commitments to implement the CBD (which entered into force in 1992) and 14 reaffirm commitments towards the Convention on International Trade in Endangered Species (CITES, which dates from 1973). Momentum towards including reference to these multilateral environmental agreements in RTAs emerged in the mid-2000s.

Some RTAs include provisions to promote biodiversity more broadly. Following the pioneering example of the North American Free Trade Agreement (NAFTA) signed in 1992, 105 agreements have included provisions that either address endangered species, invasive species, migratory species, protected areas, genetic resources, biosafety or genetically modified organisms.

This is a noticeable trend in recent trade agreements, such as the Comprehensive Economic and Trade Agreement (CETA) between Canada and the EU provisionally in force since 2017, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in force since end-2018, the EU-Japan agreement in force since 2019, and the United States–Mexico–Canada Agreement (USMCA) signed in December 2019.

The US-Peru Agreement, signed in 2006, is often cited as a successful example in promoting biodiversity by strengthening legislations on forestry and wildlife and bringing trading partners’ policies aligned with CITES provisions.

While largely a feature of agreements among developed countries to date, these provisions to safeguard biodiversity-related concerns in trade agreements are also relevant for least developed countries. For example, the Common Market for Eastern and Southern Africa (COMESA) agreement expanded in 2015 includes references to CITES.

An important initiative to support biodiversity in the context of trade agreements is ongoing efforts at the WTO to negotiate an agreement to eliminate fisheries subsidies that provoke overcapacity or IUU fishing that harm marine ecosystems and deplete stocks. While progress has been difficult, WTO members have indicated their interest in reaching agreement by the ministerial conference in June 2020. An important aspect of these negotiations has been generating more transparency on existing levels of support and better information on policy alternatives for reform.

Aligning biodiversity and trade objectives through other initiatives

Product-specific mechanisms – including agreements and memoranda of understanding related to trade in specific products – can be effective instruments, especially if they cover traded products with major land-use implications and contain biodiversity-specific provisions that are strictly enforced.

For example, the EU has concluded voluntary partnership agreements (VPAs) for trade in forest products with a number of countries, one of which is currently in place between the EU and Indonesia. As of December 2019, seven partner countries are signatories to the VPA including the Central African Republic, Democratic Republic of the Congo and Liberia. Negotiations are currently underway with Lao PDR and initial processes have started with Myanmar.

Other recent initiatives intended to help integrate biodiversity objectives in trade-related strategies include action by some EU member states. Ireland’s National Biodiversity Strategy and Action Plan, for example, includes a target that seeks to address the adverse impacts on biodiversity from trade.

Strong international cooperation needed

The ecosystem services provided by biodiversity underpin economic development and human well-being across all countries and levels of development.

Further effort is required to ensure trade is part of the solution in the shift towards more sustainable production and consumption patterns worldwide. Action that protects ecosystems must also support the sustainable development objectives of least developed countries.

Official development assistance, including aid for trade initiatives, can play an important role in helping these countries put in place the enabling conditions to overcome barriers and scale up entry into markets for sustainable agriculture, forestry and fisheries via sustainable certification schemes.

Development assistance can also support capacity for enforcement and the application of property rights, including intellectual property, to ensure that poor countries are able to protect and benefit from valuable resources.

Governments also have an important role to play in ensuring that their companies operating abroad are contributing to sustainable development. Policy measures promoting and facilitating responsible business conduct are important tools for improved biodiversity outcomes.

Parties to the CBD are now proposing new targets for the post-2020 global biodiversity framework, including on trade issues covering wildlife and flora. This underscores the strong need for further multilateral and regional dialogue and cooperation to ensure that all countries are able to participate and benefit from efforts to address the global and urgent challenge of protecting biodiversity.

 

 

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Katia Karousakis is Biodiversity Team Leader at the Environment Directorate, OECD. Shunta Yamaguchi is a Trade and Environment Policy Analyst at the Environment Directorate, OECD.

KEYWORDS: biodiversity

CREDITS: Header image - ©UNDP/Vlad Sokhin via Creative Commons Attribution-NonCommercial-NoDerivs 2.0 Generic (CC BY-NC-ND 2.0)