New Zealand leads the call for fossil fuel subsidy reform at WTO
New Zealand is continuing its leadership in tackling damaging fossil fuel subsidies through a launch of Joint Ministerial Statement, supported by 45 WTO Members, Trade and Export Growth Minister Damien O’Connor announced.
In his launching remarks, Damien O’Connor spoke to the environmental, economic, and social costs of fossil fuel subsidies.
“Worryingly, fossil fuel subsidies have continued to increase in the past decade, costing governments approximately US$500 billion of public funds per annum. These subsidies work against our efforts to address climate change by artificially lowering the cost of fossil fuels, and encouraging their on-going use. This is the opposite of what we should be doing,” Damien O’Connor said.
The successful delivery of this Statement is another example of New Zealand’s leadership in addressing environmentally harmful subsidies, including through its hosting of APEC 2021.
Damien O’Connor launched the Joint Ministerial Statement on Fossil Fuel Subsidy Reform with EU Trade Commissioner Dombrovskis, at a virtual event held overnight. The event was attended by WTO Director-General Ngozi Okonjo-Iweala, along with key international trade and environment organisations. The Statement was originally due to be launched at the WTO’s Twelfth Ministerial Conference, which was postponed due to the outbreak of the Omicron variant of COVID-19.
Damien O’Connor commended the co-sponsors of the Statement for seizing the opportunity to advance this discussion towards agreed disciplines within the rules-based institution. The initiative is timely as Members look to the future and seek to embed new climate-resilient policies.
“It is vital that we shift from business-as-usual as soon as possible. The trade community has a role to play in supporting global efforts to address climate change.”
Climate Change Minister James Shaw welcomed the Statement, noting that the recent Glasgow Climate Pact, for the first time, explicitly recognised the need to phase out fossil fuels.
“Many people, including me, would have liked the COP26 agreement to go further on fossil fuels. But the very fact they were mentioned at all is a significant milestone. It is especially encouraging to now see Aotearoa New Zealand leading by example with this commitment to tackle the out-dated fossil fuel subsidies holding back our efforts to keep the 1.5 degree goal alive,” said James Shaw.
Damien O’Connor said New Zealand also co-sponsored two additional joint Ministerial statements on trade and the environment at the event overnight.
“These statements signal our continued support for the WTO’s structured discussions on trade, environment and sustainable development, as well as on plastics pollution and sustainable plastics trade.
“We fundamentally believe that the rules-based system of the WTO is a force for positive change,” Damien O’Connor said.
The Joint Ministerial Statement on Fossil Fuel Subsidy Reform can be found here.
The Joint Ministerial Statement on Trade and Environmental Sustainability Structured Discussions (TESSD) can be read here.
The Joint Ministerial Statement on Informal Dialogue on Plastic Pollution and Environmentally Sustainable Plastics Trade (IDP) can be read here.