The European Parliament,

–   having regard to the reports of the three working groups of the Intergovernmental Panel on Climate Change (IPCC) entitled, 'The Physical Science Basis', 'Impacts, Adaptation and Vulnerability' and 'Mitigation of Climate Change', all published in 2007,

–   having regard to its resolution of 23 May 2007 on the EU's Aid for Trade(1),

–   having regard to the European Council Presidency conclusions of 8 and 9 March 2007,

–   having regard to the Commission communication on Limiting Global Climate Change to 2 degrees Celsius - The way ahead for 2020 and beyond (COM(2007)0002),

–   having regard to the Commission proposal for a directive of the European Parliament and of the Council amending Directive 2003/87/EC so as to include aviation activities in the scheme for greenhouse gas emission allowance trading within the Community (COM(2006)0818),

–   having regard to the Stern review on the Economics of Climate Change, presented on 30 October 2006,

–   having regard to the OECD report on 'Biofuels: is the cure worse than the disease', of 11 and 12 September 2007,

–   having regard to the presentations by the co-chair of IPCC Working Group III, Bert Metz, and other experts appointed by Parliament, during a hearing on Trade and Climate Change on 27 June 2007,

–   having regard to its resolution of 25 October 2006 on the annual report from the Commission to the European Parliament on third country anti-dumping, anti-subsidy and safeguard action against the Community (2004)(2),

–   having regard to its resolutions on bilateral trade and investment relations, notably those of 13 October 2005 on prospects for trade relations between the EU and China(3) and of 28 September 2006 on the EU's economic and trade relations with India(4),

–   having regard to its resolution of 4 July 2006 on reducing the climate change impact of aviation(5),

–   having regard to its resolution of 16 November 2005 on "Winning the Battle Against Global Climate Change"(6),

–   having regard to Rule 45 of its Rules of Procedure,

–   having regard to the report of the Committee on International Trade and the opinions of the Committee on the Environment, Public Health and Food Safety and the Committee on Industry, Research and Energy (A6-0409/2007),

A.   whereas the economic and ecological impact of climate change is assuming disturbing proportions and the EU, which has already taken on a leading political role in this area, should redouble its efforts,

B.   whereas it is estimated that a reduction in global emissions by as early as 2015, with a 25 % to 40 % reduction by 2020 in developed countries, would not ensure that the objective of limiting temperature increases to 2°C above pre-industrial levels would be attained,

C.   whereas limiting global warming to 2˚C would reduce, but not eliminate, dramatic consequences for agriculture, weather hazards, migration and biodiversity,

D.   whereas global trade has increased at more than twice the rate of global economic output in recent decades,

E.   whereas the volume of sea transport is 40 times that of air transport in tonnes per km and yet produces only twice the greenhouse gas (GHG) contamination, whilst lorries produce four times more GHG emissions than trains in tonnes per km,

F.   whereas freedom of choice as regards the means of transport used is essential to worldwide trade,

G.   whereas there is an urgent need to develop production, consumption and trade patterns that mitigate climate change and its economic impact and maximise total welfare,

H.   whereas energy efficiency, sustainable traffic management and shorter distances between producers and from producers to consumers are elements which must be included in any EU trade policy that has a bearing on the issue of climate change,

I.   whereas promoting sustainable development should continue to be the main objective of EU trade policy, including through seeking to ensure that the policy accelerates the transition to a low carbon, highly energy efficient economy,

J.   whereas consumers should receive the best possible information about the GHG emission effects of their purchases,

K.   whereas prices must include the cost of global commons such as a stable climate,

L.   whereas the UN Climate Change Conference (COP 13) in Bali in December 2007 should launch negotiations to establish a global and comprehensive post-Kyoto agreement (from 1 January 2013), including binding GHG emission targets,

M.   whereas the long-term objective should be to ensure the international convergence of equal per capita GHG emissions by 2050,

N.   whereas the countries that have ratified the Kyoto Protocol have not damaged their competitiveness (with the notable exception of the cement sector) and have positioned themselves as leaders in a world where GHG emissions may be regulated,

O.   whereas this competitive situation may not continue in the post-Kyoto period if some countries, in particular the USA, Australia, China and India, amongst others, are not involved in the '+2°C' objective, thus distorting competition in favour of firms moving to unregulated locations and increasing GHG emissions from production and transport,

P.   whereas action to combat climate change should be taken across a broad front and, if it is to succeed, requires the convergence of all the main players worldwide, depending on their respective levels of development, towards trade policy positions compatible with the objective of combating climate change,

From consensus to action

1.  Welcomes the broad scientific and political consensus on the seriousness of climate change; urges the conclusion of an ambitious, worldwide, post-Kyoto agreement, in line with the scenario of IPCC Working Group III , on the need to limit temperature increases to 2°C and for corresponding adjustments to be made to other international agreements concerning trade, civil aviation and intellectual property; considers that a post-2012 framework should allow different countries to participate, according to their national circumstances, through a short-term, multi-stage approach and that, in the medium-term, emissions should be allocated on a per capita basis, first to developed countries, but eventually to all countries; calls on the Council and the Commission to work towards building a consensus on a post-2012 framework through broadening engagement, to include key parties currently outside of the Kyoto Protocol, notably the USA and Australia, and to collaborate with individual states and businesses in the absence of any commitment made by their governments;

2.  Considers that the EU and its Member States must seek to rigorously apply the Kyoto Protocol's enforcement mechanism procedure when it comes into force, in order to ensure that countries that have not accepted targets or are not meeting them do not enjoy an unfair advantage and that as long as companies are vulnerable to unfair competition from countries that do not accept targets, industry will always find it difficult to improve the carbon-efficiency of its own operations; considers that where a country exceeds the permitted emissions in the first commitment period, it should be required to make up the difference in the second commitment period, in addition to a penalty deduction of 30 %; stresses that the EU must make sure that that requirement is applied as rigorously as possible when it comes fully into force;

3.  Welcomes the Clean Development Mechanism within the Kyoto Protocol as an incentive for investment in developing countries that reduce carbon emissions but notes that it is not yet sufficient to significantly shift investment patterns in those sectors that have the greatest impact on climate change, such as power generation, transport and industrial energy use; considers that, in order to rectify this, the EU should take the lead amongst the developed world in increasing the resources available through the Global Environment Facility;

4.  Considers that increasing trade should be regarded as a positive factor for economic growth and citizens' well-being, once the problems relating to climate change have been taken into account; is worried that the increased volume of trade is making a substantial contribution towards climate change and considers that trade policy must therefore provide part of the solution; emphasises that, given the growing consensus on the urgency to tackle climate change, the EU must increasingly implement trade and investment policies that create economic incentives to meet climate change policy objectives; stresses that the EU may need to use those rules to create economic disincentives for climate-unfriendly activity; considers, however, that this must not be used as an excuse for protectionist policies against developing countries;

5.  Regrets that the current trading system produces a global division of labour which is based on a very high input of transport of homogeneous products which could just as easily be produced locally and that such transport does not bear its own environmental costs;

6.  Points out that while trade can make a significant contribution to economic development and human prosperity, the transport sector (principally road transport), which enables trade in goods and raw materials to take place, is simultaneously responsible for one-third of global GHG emissions; considers that measures to drive a modal shift to more environmentally friendly transport modes (such as rail and water) and to reduce GHG emissions from freight transport are imperative;

7.  Considers that the EU, as a global trade partner, is well-placed to contribute to a worldwide shift in production and transport patterns; considers that a front-running Europe would be in a more competitive situation when stricter regulations are adopted worldwide;

8.  Recalls that the dismantling of administrative barriers to trade, and action to combat climate change, can be achieved only through co-ordinated multilateral action, this being also in the essential interests of the EU, which plays a leading role in both these fields, particularly with a view to retaining European competitiveness;

Towards multilateralism against climate change

9.  Stresses the need for strong cooperation between the UN Environment Programme, the UN Framework Convention on Climate Change and the WTO, and asks the Commission to develop an initiative to support this aim; asks for swift progress to be made in updating the WTO's definition of environmental goods and services, particularly in the current Doha Round negotiations, but recommends, as a starting point, a specific link to climate change, in order to reach agreement on the removal of tariff and non-tariff barriers to 'green' goods and services that prevent or slow the dissemination of low carbon technologies; calls on the Commission to build a consensus on granting Multilateral Environment Agreement (MEA) Secretariats observer status at all meetings of the WTO that are relevant to MEA issues; stresses that a lasting solution must contain a strong political message that respects an appropriate division of labour between the WTO and MEA regimes, based on core competencies; is convinced of the need to redefine the responsibilities of the WTO Committee on Trade and Environment; recommends launching a study on possible amendments to the WTO Agreement on Trade Related Aspects of Intellectual Property Rights in order to allow for the compulsory licensing of environmentally necessary technologies, within the framework of clear and stringent rules for the protection of intellectual property, and the strict monitoring of their implementation worldwide;

10.  Insists that obligations under MEAs, such as the UN Framework Convention on Climate Change or the Kyoto Protocol, must be complied with and that the narrow interpretation of trade rules must not be allowed to prevent or obstruct the attainment of their objectives;

11.  Believes that WTO rules should not prevent Member States from encouraging the further development of low-energy technologies by insisting on technical neutrality, which could undermine incentives for the development of renewable technology;

12.  Asks the Commission to take initiatives at the international level, and particularly within the WTO, to ensure that trade policy as a whole, and in relation to trade volume trends, takes account of its potential impact on climate change;

13.  Calls on the Council and the Commission to ensure that EU bilateral trade agreements and WTO multilateral trade agreements are concluded in keeping with those provisions of the Agreement establishing the WTO, which specify that international trade should be conducted while allowing for the optimal use of the world's resources in accordance with the objective of sustainable development, seeking both to protect and preserve the environment; recommends that the 'sustainability clause' be added to the General Agreement on Trade and Tariffs (GATT), the core agreement of the WTO system, setting out agreed principles of environmental policy, such as the polluter-pays principle and the precautionary principle, against which measures can be judged;

14.  Calls, furthermore, on the Council and the Commission to ensure that the WTO Dispute Settlement Body acts in accordance with Article XX of the GATT, which allows its members to take measures, including protectionist measures, necessary to protect human, animal or plant life or health or relating to the conservation of exhaustible natural resources;

15.  Notes that the EU is already a world leader in alternative energy technologies, supporting China and India, particularly regarding the trade and technology transfer of wind and solar renewable energy technologies and that, thanks to efficient and technologically innovative European undertakings, the EU should be a market leader in the worldwide export of environmental goods and services and that Galileo and the Global Monitoring for Environment and Security System could be used to monitor CO2 emissions; calls on the Commission to ensure that energy and particularly the question of renewable energy and efficiency, and their connection to energy security, becomes an integral part of all external EU relations, with a particular emphasis on the European Neighbourhood Policy;

16.  Urges the EU, with a view to achieving the Lisbon objectives, to develop and promote 'climate-friendly' industry at a global level particularly as trade is an important tool for the transfer of technology to developing countries; emphasises the need to reduce barriers to 'green' trade by, for example, removing tariffs on 'green' goods at the WTO level, reshaping the rules on intellectual property rights, facilitating the market entry of green technology by allowing climate concerns to guide export credit guarantees and removing perverse incentives and distortions of the market, such as fossil-fuel subsidies;

17.  Calls for the establishment of an international environmental organisation which would assume responsibility for compliance with international treaties and agreements on environmental protection and combating climate change, and which would, inter alia, work and cooperate with the WTO on issues concerning the impact of trade on the environment;

18.  Recognises that the EU bears a historical responsibility for GHG emissions and realises that substantial changes to its trade policy are required to encourage local production as a means of reducing the need for transport; stresses the need for more intensive technological cooperation with developing and emerging countries, particularly China, Brazil and India, in order to enable them to mainstream environmental protection in their policies; regrets, however, that existing technology-transfer mechanisms like the Clean Development Mechanism are insufficient and therefore calls for increased co-financing and capacity building measures;

19.  Notes that the transfer of energy efficient and other environmentally friendly technologies from the EU to developing countries has a crucial role to play in decoupling economic development from GHG emissions and that suitable investment is needed to promote such a reduction; calls on the Commission to provide incentives by means of suitable supporting finance and the transfer of know-how;

20.  Asks the Commission systematically to include environmental protection clauses, with special reference to reducing carbon dioxide emissions, in its trade agreements with third countries; calls for the transfer of low carbon technology and low carbon trade schemes to developing countries; asks the competent Commission services swiftly to develop a climate change dimension in its Sustainability Impact Assessments (SIAs), to discuss the SIAs with Parliament, and to apply them systematically before the conclusion of the agreements;

21.  Calls on the Commission to argue, in the context of the WTO agreements, for account to be taken of the 'sustainability impact assessment method' and thus to assess, over the long term, how far the classification of environmental goods in the field of renewable energy resources is being properly taken into account in bilateral and multilateral agreements;

22.  Calls on the Council and the Commission to ensure that the negotiations on the new generation of Free Trade Agreements (FTA) with partners in Asia and Latin America include commitments to the social and environmental aspects of trade, particularly addressing trade and investment in renewable goods and services, and sustainable development and to the effective implementation of MEAs; suggests that liberalising trade in renewable goods and technologies and increasing access to environmental services should be a key objective of the Commission in the forthcoming FTA negotiations; stresses the need to introduce WTO-compatible green government procurement policies systematically into bilateral agreements;

23.  Calls for in-depth impact analyses from a climate, gender and sustainability perspective, of the outcome of multilateral and bilateral trade agreements negotiated between the EU and third countries and urges the Commission to authorise explicit support for the management of climate change as part of all aid-for-trade and other relevant development aid;

24.  Supports the Commission's proposal to establish in each trade agreement a sustainable development forum, with a strong climate component, which would be open to participation by elected representatives, civil society (particularly NGOs operating in the environmental field) and other key stakeholders and calls for those fora to be ensured during ongoing negotiations;

25.  Stresses the need to broaden the environmental policy dialogues as well as the energy policy dialogue that form part of EU agreements with third countries or regions to cover questions of climate change and asks the Commission to put forward concrete proposals for benchmarks for progress according to the type of country;

26.  Considers that the conservation of ecosystems which play a valuable role as carbon sinks and biodiversity reserves represent global public goods and need special protection and international financial support; proposes incorporating Forest Law Enforcement, Governance and Trade partnership agreements into all existing and future agreements with third countries;

27.  Recognises that trade too often leads to the overexploitation of eco-systems, particularly forests, in developing countries; urges industrialised countries to take responsibility for the widespread deforestation caused by international trade; emphasises the significant climate impact of deforestation and therefore the long-term economic value and importance of preserving forests intact; calls for serious EU efforts to establish reward mechanisms for 'avoided deforestation' in the international climate negotiations, along with other strong policy measures to promote responsible trade in natural resources; emphasises that policies on strengthened and sustainable forest management should be country-led and calls on the Commission to provide financial and technical assistance in this regard; stresses that assistance from the international community should take into account the opportunity costs of alternative uses of land, the costs of administering and enforcing protection and the challenges of managing the political transition as established interests are displaced; stresses that in order to avoid rural unemployment and rural-urban migration, complementary programmes to help identify new income sources are vital;

28.  Supports the Commission proposal to enhance cooperation with developing countries in areas of climate change adaptation and mitigation through setting up a global climate policy alliance; stresses that intensifying dialogue and moving towards the development and implementation of joint programmes in areas of mutual environmental concern, such as climate change, waste management and illegal logging, with key emerging economies such as China, India, Brazil, Ukraine and South Africa, must be a priority for the EU and its Member States;

29.  Calls for the discontinuation of public support, via export credit agencies and public investment banks, for fossil fuel projects and for the redoubling of efforts to increase the transfer of renewable energy and energy efficient technologies;

30.  Asks the Commission and the Member States to propose legislative instruments in order that Member State export credit agencies and the European Investment Bank take account of the climate change implications of the funded projects when making or guaranteeing loans and impose a moratorium on funding until sufficient data are available, in accordance with advice from the OECD, the G8 and the Extractive Industries Review;

31.  Suggests amending the WTO subsidies agreement in order to reintroduce a clause providing for the non-action ability of certain environmental subsidies;

The EU can do more to avoid CO2 leakage

32.  Repeats the need for a 30 % reduction in EU GHG emissions by 2020, independent of third countries" commitments;

33.  Stresses the need to raise public awareness of the total environmental costs of consumer products; calls on the Commission and the Council to propose measures for the provision of information on the energy consumed, and GHGs emitted, during the manufacture and transport of products placed on sale within the EU, such as the proposal made by the UK Government to introduce carbon footprint product labels displaying the level of CO2 emission caused by the production, transport and eventual disposal of a product;

34.  Insists on the introduction of WTO-compatible common standards and labelling schemes regarding the GHG implications of different products, including at the production and transport stages, as part of a wider consumer information policy, thereby giving consumers the opportunity to contribute to reducing CO2 emissions;

35.  Asks the Commission urgently to draw up an adequate procedure to assess and label those ecological footprints and to develop software in order to enable businesses to calculate the quantity of GHG emitted from every production process;

36.  Stresses that efforts need to be made to internalise external influences linked to trade (such as harmful consequences for the environment), in other words to convert them into a price indication which the market can understand, and to promote fair competition by putting into practice the 'polluter pays' principle (particularly in the areas of road and air traffic), ideally through the global extension of the Emissions Trading Scheme;

37.  Notes the inseparable link between trade and the transport sector; urges that consideration be given to all means of transport and, in particular, those whose emissions have increased significantly in recent years, namely shipping (whose carbon dioxide emissions are thought to be double those of aviation and which could rise by as much as 75 % in the next 15 to 20 years);

38.  Welcomes, within the framework of the 'footprint' approach, the eventual integration of airplanes landing in Europe within the Emission Trading Scheme; calls for the proposal to extend the scheme to cover more sectors, including the marine transport sector to be examined;

39.  Recognises the promotion of ICT-based solutions, the internalisation of the environmental costs of transport in fuel prices, as well as the promotion of rail transport and coastal shipping, sustainable biofuels and the rapid integration of aviation in a rigorously designed Emissions Trading Scheme, as key measures for reducing the impact of trade and transport on the climate; calls on the Commission and the Council to propose measures to promote and choose the least polluting modes of transport, particularly by drawing up provisions relating to the various market instruments;

40.  Urges that aid granted to the transport sector be calculated taking into account the environmental impact of the different modes of transport, and that consideration be given to using WTO-market-compatible trade instruments (such as labelling and standards) which promote climate protection;

41.  Considers that, given that the real carbon cost of road transport is not known, especially in the case of food and other daily consumables, support schemes to promote sustainable local production should be regarded as acceptable and promoted so as to discourage the excessive transport by road of food; also recommends the introduction of climate WTO-compatible labelling standards in order to inform consumers of the ecological footprint of products;

42.  Is especially concerned by the potential negative, environmental and social impact of policies encouraging biofuel and biomass use in Europe; reiterates its earlier calls on the Commission to pursue a WTO-compatible sustainability certification scheme for biofuels (or their feedstocks) as a condition for their use and for their compliance with EU-wide mandatory sectoral targets; however, underlines the very important role of the development of first-generation biofuel crops for the future of the European farmers who have been affected by the reform of the Common Agricultural Policy and the Common Market Organisation of Sugar; insists, therefore, on measures to ensure sustainability throughout the whole production cycle;

43.  Calls for all agreements on the purchase of biofuels to be subject to clauses seeking to protect areas given over to biodiversity and human food production;

44.  Calls on the Commission to assess the climate impact of EU imports of soya and palm oil, taking into account their effects on tropical deforestation, particularly affecting the Borneo and Amazon regions and to take measures to incorporate the climate cost in prices;

45.  Asks the Commission to encourage a European drive towards best practices and benchmarking in relation to the climate change aspects of location, with particular reference to an ever more geographically fragmented production chain and 'just-in-time' production, and to forward related proposals;

46.  Calls on the Commission to examine WTO-compatible mechanisms and climate-friendly trade policies in order to address issues relating to third countries which are not bound by the Kyoto Protocol and to work towards making more explicit provision for such possibilities in future versions of the Protocol; considers that trade measures should be taken only when alternative measures would be ineffective in achieving a given environmental objective; considers that the trade measures used should be no more trade-restrictive than necessary to achieve the objective and should not constitute arbitrary or unjustifiable discrimination;

47.  Recommends the development, in the longer term, of a scheme based on sound life-cycle data which includes finished goods, such as cars and electronic equipment, in this adjustment where necessary;

48.  Insists that future proposals must be fully in accordance with the EU's international obligations, particularly those imposed by the WTO, including Article XX of GATT;

49.  Invites the Commission to consider whether it would be appropriate to evaluate the rules on trade defence measures, such as the rules on anti-dumping or subsidies, within the aegis of WTO, with a view to taking into account, in some way, the failure to comply with global, social and environmental agreements or international covenants as forms of dumping or undue subsidy;

50.  Stresses, at the same time, that when trade defence instruments are reformed, they should take account of the feasibility of introducing environmental factors in order to avoid environmental dumping of products originating from countries that have not ratified the post-Kyoto protocol;

51.  Calls for incentives for the production, through granting state or Community funds, and use, through reductions in value added tax, of products which help to reduce CO2 emissions;

o
o   o

52.  Instructs its President to forward this resolution to the Council, the Commission and the governments and parliaments of the Member States.

(1) Texts adopted, P6_TA(2007)0203. (2) OJ C 313 E, 20.12.2006, p. 276. (3) OJ C 233 E, 28.9.2006, p.103. (4) OJ C 306 E, 15.12.2006, p. 400. (5) OJ C 303 E, 13.12.2006, p. 119. (6) OJ C 280 E, 18.11.2006, p. 120.