UNEP, through the launch of its Green Economy and Trade Opportunities – Synthesis Report, shows concrete examples of how developing countries can help grow their economies through trade while reducing the negative environmental and social impacts of key national economic sectors.
Since the creation of the World Trade Organization 20 years ago, there has been ever increasing attention on the links between trade and environment, and more recently on the interface between trade and an inclusive green economy. The Sustainable Development Goals once again stressed the important role that trade and investment play in advancing sustainable development. Similarly, the Paris Agreement marked a momentous step in the fight against climate change, emphasizing the need for novel mechanisms to meet commitments under the agreement. In this context, it is of utmost importance to ensure that trade serves as a driver, and not as a threat, to sustainability.
With these priorities in mind, UNEP marks the end of the Green Economy and Trade Opportunities Project (GE-TOP) with the launch of a series of country studies, action plans and a report that summarize how trade can help sustainable development. The Synthesis Report tells the story of projects conducted in five different countries: Chile, South Africa, Peru, Ghana and Vietnam. In each of these, UNEP worked to identify, assess, and harness sustainable trade opportunities at country and sectoral level as a means of accelerating the shift to an inclusive green economy and as a vehicle to sustainable development.
The regional and sectoral focus makes this project unique. It provides relevant and transferable country and sectoral examples of how trade, when done right, can be an engine for sustainable development, social inclusion, and poverty reduction.
Selected findings of the country studies include:
- Ghana: A grid-connected 100 MW solar plant in the North of Ghana could save 40,000 tCO2 annual emissions compared to business-as-usual, create 3,000 direct jobs, provide livelihoods for 23,000 of the poorest people, and earn Ghana an annual $38 million in foreign exchange from export.
- Viet Nam: Roughly 15 per cent of the volumes of shrimp and pangasius produced in the country are certified. Sustainability certification for shrimp increases a farmer’s profit by up to 15 per cent. Shrimp farms producing under international certification schemes employed up to 9 per cent more workers.
- Peru: Biotrade and exports of native biodiversity products have big growth potential in Peru. Native biodiversity exports had a growth rate of 200 per cent between 2005 and 2013, peaking in 2011. Nevertheless, they represent less than 1 per cent of total exports, despite the fact that these products have the most potential to improve the social and economic conditions of its producers.
- South Africa: The country has witnessed a decline in certified organic land, going from 45,000-50,000 ha in 2005 to 37,466 ha in 2015. Despite this decrease, the number of organic farmers has increased from 200 in 2005 to 250 in 2015. In order to promote the expansion of the organic sector, South Africa requires a national organic regulation or standard that defines the legally enforceable definitions of organic production.
- Chile: The introduction of a national sustainability standard in Chile could enhance the trade potential of the agricultural sector by bridging the gap between national and international production standards. There are currently 37 international standards and initiatives that apply to the Chilean agriculture sector, of which 34 relate to the fresh fruit and vegetable sector, 25 to the wine sector, and 28 to food products more generally.
Lessons learned across the different country projects include:
- The transition to an inclusive green economy creates enhanced trade opportunities by opening new export markets for environmental goods and services. As market demand for resource- and energy-efficient processing and production increases, it provides incentives for sustainably-certified production in various sectors.
- Markets for sustainably-certified products often have faster growth rates than conventional markets, representing an incentive for production and export in green sectors.
- There are economic, social and environmental gains from making trade more socially and economically sustainable. Growing trade in environmental goods and services, as well as the diffusion of sustainability standards and the greening of global value chains, can significantly influence world trade patterns.
- Green production sectors, regardless of their contribution to national GDP, are often the ones that bestow the highest social and environmental benefits.
- For trade and green economy to mutually benefit each other, coordination between the public and the private sector is required. The public sector needs to create the enabling regulatory and fiscal environment, while private actors need to recognize and seize opportunities, invest in green production methods and open new markets.
- Appropriate regulation and incentives are critical for trade to become a driver of an inclusive green economy. With appropriate incentives in place, trade can foster the exchange of environmentally preferable goods and services, increase resource efficiency and generate economic opportunities and employment.
- An important element for the synergistic interplay of green economy and trade is the integration of national and international initiatives. Sustainability standards are an example of how international requirements can be a positive force in encouraging the overall improvement of local standards.
UNEP will continue its work on trade through its recently launched Environment and Trade Hub. Through the Hub, UNEP will continue providing capacity building for developing countries in areas such as enhancing trade in environmentally sound technologies, shaping global governance at the trade-environment interface, promoting sustainable consumption and production through greening of global value chains, and reducing the footprint of trade.
This report is a result of UNEP’s Green Economy Opportunities project, funded by the European Commission. It builds on the 2013 report “Green Economy and Trade – Trends, Challenges and Opportunities,” which explored what a transition to a green economy implies for international trade and what enabling conditions are required to foster a mutually conducive interplay of international trade and green economy.
The different country studies and the synthesis report can be accessed here.
For more information on UNEP's Environment and Trade Hub
