Biden would be a powerful ally in the UK’s efforts to “rewrite the laws of global trade” in order to focus on broader green policy goals. Addressing the climatic and environmental issues, boosting employment standards, and supporting democracy and human rights may all be on a new green trade agenda.
According to the think tank, the UK and US have the potential to create the “greenest trade pact in history” after Brexit, which may contain “non-regression clauses” to prevent either country from reverting to the high environmental standards agreed upon.
The UK and US, according to IPPR, also have the opportunity to lobby for WTO reform at the G7, making it easier for countries to address climate change. This would involve supporting the concept of a “climate waiver,” which would provide countries more leeway to take climate action, such as subsidizing green businesses, without risking trade wars and penalties.
Both richer and poorer countries must be able to establish ambitious environmental targets at home that are not undermined internationally, and stronger or wealthier G7 countries must support less developed countries in their fight against climate change. The likelihood of some countries being penalized for pursuing stronger environmental measures would be avoided if they worked together to build a coordinated green strategy to trade.
The think tank claims that a new global standard can now be applied to climate action, based on the strong signals conveyed by the G7’s landmark deal to crack down on tax dodging by major internet companies.
This year, the UK will host the G7 and COP26 summits, providing an opportunity for the government to assume a global leadership role. Taking advantage of this opportunity could assist to liberalize environmental goods trade, eliminate carbon leakage issues, and pave the road for an environmentally ambitious trade pact with the US.