This study on harnessing internationaltrade to support climate change objectives assesses thefollowing: 1) What are the main policy prescriptions forreducing greenhouse gases that are employed by OECDcountries and how do they impact the competitiveness oftheir energy-intensive industries? 2) On account of theimpact on competitiveness, is there is leakage of energyintensive industries from OECD countries to developingcountries? 3) Under what conditions can one justify trademeasures under the WTO regime? What are the impacts oflevying trade measures on trade flows and emissions? 4) Whatare the underlying trade and investment barriers to the useof clean energy technologies in developing countries? 5) Inaddition to tariff and non-tariff barriers, are there otherissues impacting the diffusion of clean energy technologiesin developing countries? 6) Is liberalization of renewableand clean coal technologies a plausible solution toassisting developing countries in achieving a low-carbongrowth path? 7) What conditions are necessary fornegotiating a "climate-friendly" package under thecurrent WTO framework? The key findings and recommendationsof this report include: a) Industrial competitiveness inKyoto implementing countries suffers more from energyefficiency standards than from carbon taxation policies; b)Industrial competitiveness affected by carbon taxationpolicies are often offset by "policy packages"; c)Some evidence supports leakage of carbon-intensive countriesto developing countries; d) Trade measures can be justifiedonly under certain conditions; e) The proposed EU"Kyoto Tariff" may hurt the United States'trade balance; f) Varied levels of tariffs are impedimentsto clean energy technology diffusion in developing countries.
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