The United Nations Environment Programme (UNEP), with the International Resource Panel (IRP), published a document to help policy makers better understand the links between trade and consumption of natural resources (biomass, fossil fuels, metals and non-metallic minerals). The study finds that uncontrolled international trade has a damaging effect on the planet, but appropriate trade measures can enable a less resource-intensive economy.
El Valid identity document, titled "Sustainable resource trade: global material flows, circularity and trade"is based on the need to better understand the links between trade and consumption of these resources. UNEP highlights that “the material required for trade was three times greater than that for direct trade” in 2017, with 35 billion tonnes of material resources extracted globally to produce 11 billion tonnes of directly traded goods. The statistic lends credence to IRP research that shows an "observed shift in environmental burdens from high-income importing countries to low-income exporting countries".
The paper therefore builds on the work of UNEP’s Trade and Environment Centre to increase understanding among policymakers regarding trade flows of the above-mentioned resources, including their environmental impacts, and the capacity of trade to contribute to the transition to a greener and more circular economy. Noting that global exports of natural resources per capita doubled between 1970 and 2017 and that overall global extraction of those materials tripled in the same period, the report traces the trends and resource requirements of international trade over time, and describes how and where material footprints have shifted and become marked as growing demand is being met by fewer exporters.
The paper finds that the extraction and processing of these resources was responsible for 90% of species loss, 90% of water stress and 50% of greenhouse gas (GHG) emissions in 2017. In terms of the resources being extracted, the paper notes that fossil fuels and metallic minerals together accounted for about 75% of global physical trade flows that year. To combat these impacts, UNEP and IRP call for a circular economic model that changes the trajectory of demand for natural resources, which is currently on track to double from current levels by 2060.
An informational page The UNEP/IRP report recognizes that international trade is capable of accelerating environmental degradation by driving production and resource use—and shifting that production to countries lacking strict environmental regulations—and increasing transportation-related pollution. However, it highlights, as also noted in the report's executive summary, that Trade can facilitate access to green technologies and enable the proliferation of environmental goods and services.
A circular economic model, notes a UNEP press release, can reduce GHG emissions by up to 90% while boosting growth by 8% by 2060. The World Trade Organization (WTO) is being asked to take the environment into account when setting regulationsThe report thus recommends regional trade agreements as a potential means to promote green investments, eliminate fossil fuel subsidies and reduce demand for primary raw materials, in part by harmonizing product standards that can enable circular economies on a regional scale.
The recommendations costs for policy makers include:
- improve alignment between international trade and environmental legal frameworks;
- aligning the domestic policies of developing countries with trade agreements;
- ensure that trade agreements move towards a circular economy that includes developing countries; and
- advance the development of international circularity standards.
The report notes that a lack of alignment between existing trade rules and the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal hinders trade facilitation and circularity.
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