Time: Wednesday, 21/May/2025: 2:00pm - 3:30pm Session Chair: Scott Michael Hamilton Discussant: Teresa Cabrita Discussant: Scott Michael Hamilton |
Location: Room Lisbon, Building PL5 |
Trading Green (Panel 2 of 2): Sectoral Applications and Policy Mechanisms in the Evolving EU Environmental Trade Policy
Building on the theoretical frameworks established in the first panel, this panel examines concrete applications and policy mechanisms through which the EU integrates environmental concerns into its trade policy. Through detailed case studies of specific sectors and policy instruments, these contributions illuminate how theoretical paradigm shifts manifest in practical policy choices.
The first paper introduces the concept of "complementary jurisdiction" in Trade and Sustainable Development (TSD) chapters of EU Free Trade Agreements, demonstrating how this innovative mechanism enhances compliance with multilateral environmental agreements in practice. The second contribution investigates the political economy of new genomic techniques in plant breeding, revealing how the EU navigates competing interests in regulating agricultural innovation while balancing trade competitiveness, climate adaptation, and strategic autonomy. The third paper explores regulatory barriers in sustainable aviation fuels (SAFs), demonstrating how the EU's attempt to maintain technological leadership intersects with its decarbonization objectives in a globally interconnected market.The fourth contribution examines the EU’s trade-environment policy integration from a degrowth perspective, arguing that growth-oriented international trade policies and common ownership trends pose structural barriers to achieving climate goals.
Together, these cases illustrate the complex challenges of implementing environmental objectives within trade policy frameworks. While the first panel established the theoretical basis for integrating trade and environmental policy, these contributions show how such integration plays out in practice across different sectors. Through examination of specific policy mechanisms—from TSD chapters to genomic regulation to SAF standards—the panel reveals both the opportunities and constraints in operationalizing environmental objectives within trade policy. The cases highlight particular tensions between maintaining EU technological leadership, ensuring global competitiveness, and advancing environmental goals.
Presentations of the Symposium
From Co-Existence to Reinforcement in Trade and Sustainability Nexus: Example of Complementary Jurisdiction for the Multilateral Agreements in EU FTAs
This study explores the evolving relationship between trade and sustainability concerns, moving beyond the debate of their potential harmony or conflict towards a model of active reinforcement. It proposes a paradigm shift through the lens of the Trade and Sustainable Development (TSD) chapters of the European Union (EU) Free Trade Agreements (FTAs). These chapters demonstrate the EU's commitment to promoting sustainable development in bilateral agreements with external partners. By integrating multilateral agreements with effective enforcement obligations, the TSD chapters introduce a dual-layer enforcement mechanism. This mechanism, termed "complementary jurisdiction", allows for violations of Multilateral Environmental Agreements (MEA) and fundamental ILO Conventions also to constitute breaches of FTAs, significantly enhancing compliance. This approach gains particular importance in the context of the Paris Agreement and fundamental ILO Conventions, which, lacking a binding enforcement mechanism, could ben
A political economy approach to new genomic techniques in plant breeding in the European Union
The regulation and intellectual property protection of new genomic techniques in plant breeding is a contentious issue. Proponents argue that these techniques can accelerate the development of climate-resilient crops, crucial for adapting agriculture to climate change. They support liberal regulations and incentives like patents to encourage innovation. Opponents, however, liken these techniques to genetically modified organisms (GMOs), aligning them with the profit motives of large multinational corporations and monoculture farms, which they believe harm agrobiodiversity and small-scale farming. They call for stricter regulations and limitations on intellectual property.
This debate is especially intense in the EU. The article, drawing on a broad literature review, presents a political economy and geopolitical perspective, highlighting how a state’s sovereignty and competitiveness in international trade are tied to the strength of its plant breeding and agricultural productivity. The drive to support modern
Regulatory Barriers to Scaling SAFs: Safeguarding EU Technological Leadership and Decarbonization Targets in the Context of an Increasingly Interconnected World
In 2022, aviation contributed around 3.7% of the EU’s CO2 emissions, with projections showing further increases as demand grows. Unlike other sectors, aviation emissions have risen in the EU. Sustainable aviation fuels (SAFs) are seen as a key solution for reducing emissions while remaining compatible with existing engines and infrastructure.
Although the EU is expected to be a major hub for SAF demand, domestic production alone will not meet this demand. This highlights the need to scale up SAF technology and open the EU market to SAF imports. A stable regulatory framework is crucial to provide clear incentives for investments and support the EU’s net-zero goals.
This paper examines the regulatory challenges of scaling up SAF technology within the EU legal framework, focusing on key regulations such as the ReFuelEU Aviation Regulation, the Renewable Energy Directive (RED III), and the EU Emissions Trading System (ETS). It also explores SAF certification rules and their impact on SAF imports.
The study finds that while the current framework encourages SAF production, it may be too rigid, potentially misaligning the EU’s climate action goals. This rigidity could limit SAF supply and undermine decarbonization efforts, putting EU operators at a competitive disadvantage. The paper concludes with strategies to help the EU maintain its competitive edge and technological leadership in the global SAF market.
Structural Barriers to a Green Paradigm Shift in EU Trade Policy?: confronting the ‘scale’, ‘growth imperative’ and ‘power’ challenges accompanying contemporary intra-industry trade, intra-firm trade and common ownership trends
This paper, from a degrowth perspective, argues that the failure to address the ecological crisis is linked to growth-driven international trade policies. A major challenge for the EU’s integration of environmental and trade policies, and its role as a leader in sustainable trade, is its neglect of the issue of ‘scale’.
Currently, up to 60% of extra-EU trade involves intra-industry trade (IIT), which fosters capital concentration, technology diffusion, eco-innovation, and reduced CO2 emissions. While IIT’s impact is positive in terms of trade’s composition and technique effects, the ‘scale’ effect presents a challenge. To meet climate goals, it is not enough to decouple production from emissions; there must be absolute annual reductions in material extraction, energy use, and production. Planned and democratic reduction of unnecessary production, starting with IIT sectors, is essential. However, the economies of scale and growth imperative in IIT pose barriers to this approach.
Additionally, intra-firm trade (IFT) is growing, particularly within IIT sectors. IFT undermines market efficiency, allowing multinational corporations (MNCs) to escape market pressures, eroding tax bases, and challenging free trade principles. While the EU’s efforts to address IFT transparency are positive, stronger actions are needed to ensure MNCs face the same pressures as small and medium-sized enterprises (SMEs).
The paper also critiques the rise of common ownership (CO) trends, especially in sectors dominated by IFT and IIT. Growing CO increases political and market power for dominant firms, reduces eco-innovation, and promotes growth-oriented trade policies that conflict with climate science. CO thus represents a structural barrier to the EU’s efforts to align its trade policies with environmental goals.