During COP26, we have seen a fresh wave of commitments to end the devastating loss of nature primarily driven by agricultural expansion. More than 130 countries announced a new goal of halting and reversing deforestation by 2030. Investment firms managing $8.7 trillion worth of assets pledged to rid their portfolios of agricultural commodity investments driving deforestation by 2025.
The Forest, Agriculture, Trade and Commodity Dialogue, led by the U.K. and Indonesia, saw producer and consumer countries adopt a common roadmap to end deforestation this decade, a first of its kind.
This renewed urgency to establish more sustainable food and land-use systems is welcome but bound to fail like past efforts if we don’t take into account trade, and realize that how we measure success of trade does not recognize the many ways in which, it is deeply connected to the environmental impacts of food systems.
We need trade leaders in the room with us to discuss climate issues, or the policies announced in Glasgow will bear little weight. Given the higher variability that climate change brings to all economic activities, trade ministers should urgently adapt and contribute to an integrated climate mitigation agenda.
The World Trade Organization, and its topmost decision-making body, the Ministerial Conference, is a remarkable arena for trade policymakers to lead the way. It is unfortunate that renewed COVID-19 concerns yet again forced the WTO to postpone its 12th Ministerial Conference
However, “this does not mean that negotiations should stop,” as the WTO itself said in a statement. Nationally, as well as on the global stage, trade officials can play a key role by shaping and supporting sustainable policies and deals, and it is our hope that they will display climate ambition and continue to make as much progress on key issues of sustainability as the current pandemic context allows.
Why It Is Worth It
Many features of today’s trading and investment system do not contribute to environmental, health and inclusion objectives, and in certain instances actually undermine food security itself. The hidden costs of global food and land use systems are estimated at almost $12 trillion a year compared to a market value of the global food system of $10 trillion.
Why should this matter to trade ministers whose primary focus is economic growth driven by exports, as well as secure and stable supply of strategically important imports? There are many reasons.
Trade systems are increasingly at risk from higher pricing volatility and supply chain disruptions due to climate impacts including droughts, fires and flooding, and the destruction of nature. In 2021 alone, droughts on all inhabited continents contributed to global price increases of over a third. Despite important agricultural advancements to feed the world in the last 60 years, global farming productivity is 21% lower than it could have been without climate change.
This threat of lower agriculture output comes at a time when population growth is expected to drive higher food demand. Studies show that regions where demand increases most,
Future trade relations are also being shaped by the needs of emerging markets. Demand for beef, soy, palm oil, and pulp and paper from China, India, Brazil, and Indonesia is expected to increase 43% by 2025.
If we needed one more reason why trade ministers should push for sustainable practices: scientists warn that the world is close to several critical tipping points where climate change could push parts of the Earth system into abrupt or irreversible change. In the Amazon, a combination of deforestation, climate change, and widespread fires could push a further 3–8% rainforest loss and potentially cause some large areas to flip into a savannah-like ecosystem. This wouldn’t just impact Brazil, but millions of people in the rainforest region, and rainfall and climate regulation patterns globally.
New Role For Trade Officials
We believe trade leaders should feel empowered to take positive action, break down silos and collaborate with other ministers and sectors. Trade ministers must feel that the environment is no longer a bargaining chip to be negotiated with.
A new brief from the Food and Land Use Coalition details nine action areas, which policymakers can take to instigate this new trade environment. Here are those most relevant to trade leaders.
Firstly, they should take an integrated approach that aligns trade policy decisions with other national interests such as agriculture, health, and the environment. Colombia has set up a commission, which coordinates work from several ministries and institutions to strengthen food security and healthy and nutritious diets. The Comision Intersectorial de Seguridad Alimentaria y Nutricional, with its integral food systems approach, is part of efforts supported by first lady Maria Juliana Ruiz to give prominence to nutrition in the national agenda.
Secondly, the WTO offers opportunities to take forth new multilateral partnerships, or “coalitions of the willing,” which can be developed to push for better standards and increased commitments. Such partnerships could build new capacity for sustainable trade. One example of this could be the WTO agreeing to take forward the objectives of the FACT Dialogue.
Furthermore, WTO’s Ministerial Conference, when it will be able to convene, presents a critical chance for countries to move forward a stalled multilateral effort on removing perverse subsidies in global fisheries.
Finally, we must recognize that a shift to more sustainable trade cannot come at the expense of producers, particularly smallholders. Trade policy mechanisms should be paired with greater incentives for sustainable production. This can be achieved through investment in risk management tools or other financing processes as promised in the $12 billion Global Forest Finance Pledge.
Both international and national arenas provide places where trade officials can do well for their countries and the world by putting us on a path to achieve the goals set at COP26.
Felia Salim is Chair of the Board of Directors of the Partnership for Governance Reform and former Vice CEO of PT Bank Negara Indonesia and a Food and Land Use Coalition
Ambassador Izabella Teixeira is a former Environment Minister of Brazil and a Food and Land Use Coalition Ambassador