What Can Be Done to Blunt Potential Conflict between Climate Change and Trade Policies?

Abstract

The December 2015 COP 21 meeting aspires to establish a post-Kyoto Protocol agreement for addressing climate change. The shift in emphasis towards self-determined emission targets in the COP21 approach to mitigation may raise the risk of disputes over the use of border measures as part of nationally determined climate strategies. This paper discusses the tax policies at the border and subsidy elements of climate change-motivated measures and the policy reactions that may follow in cases where prior agreement has not been secured in relation to the permissible use of these instruments.