COP27: Sidelining trade policies will only worsen climate change, says Okonjo-Iweala

Ngozi Okonjo-Iweala, director-general of the World Trade Organisation (WTO), says climate financing cannot be effective if trade policies are ignored.

Speaking at the COP27 climate conference in Egypt on Tuesday, Okonjo-Iweala described the gap between trade policies and climate adaptation as “a big missing piece.”

She acknowledged the pledges made by countries and other international partners to mitigate the effects of climate change, but said restricting trade would negate achievements gained.

TheCable had reported how the UK tripled its climate finance budget to £1.5 billion, while allocating £95 million to support climate-resilient agriculture in Nigeria.

“The WTO doesn’t have money to announce but I’m pleased to hear the new financial commitments being made, thankful to all the donors,” Okonjo-Iweala said.

“However, whilst financing is important, trade and policies can block everything. Trade policies and restrictions can be a bottleneck for money to work. By leaving out trade policy from what is being done on climate change side is a big missing piece.”

Okonjo-Iweala also said trade is often viewed as part of the problem but, in reality, is it part of the solution to climate change and food security. 

She noted that trade provides food for one in every six people around the world and, therefore, has an important role in ensuring that food and other essential goods, such as fertiliser and climate adaptation goods, and services get to where they are needed.

The WTO leader further urged governments to include trade elements in their national climate adaptation plans — the building blocks for implementing global climate goals at a national level.

WTO’S ROLE IN CLIMATE CHANGE

As global food demand continues to soar, so does the dramatic impact of climate change on agricultural land and livestock productivity.

According to WTO, climate change can negatively influence trade by upsetting supply and distribution networks and driving up trade costs.

This makes its work, as an organization, crucial to advancing climate action because it is the cornerstone of the multilateral global trading system, WTO said.

The organisation noted that by connecting people and markets, trade helps lower costs and disseminate snew environmental technologies.

“Trade can also make resource use more efficient, reducing the strain on our ecosystems. New trade rules can help our economies become greener, cleaner, more prosperous, and more inclusive,” WTO added.

The COP27 aims to provide a stage for world leaders to share insights on how to coordinate efforts to boost agricultural productivity, build resilience in the farm sector, reduce losses in food supply chains and deploy sound policies to strengthen the response to a potential food crisis.

Additional reporting by Claire Mom