Trade in a ‘Green Growth’ Development Strategy : Global Scale Issues and Challenges

This paper surveys the state of
knowledge about the trade-related environmental consequences
of a country's development strategy along three
channels: (i) direct trade-environment linkages
(overexploitation of natural resources and trade-related
transport costs); (ii) 'virtual trade' in
emissions resulting from production activities; and (iii)
the product mix attributes of a 'green-growth'
strategy (environmentally preferable products and goods for
environmental management). Trade exacerbates
over-exploitation of natural resources in weak institutional
environments, but there is little evidence that differences
in environmental policies across countries has led to
significant 'pollution havens.' Trade policies to
'level the playing field' would be ineffective and
result in destructive conflicts in the World Trade
Organization. Lack of progress at the Doha Round suggests
the need to modify the current system of global policy making.