Embracing Liberalism: Addressing Climate Change through Progressive

Trade Policy
Belinda Cahya Dewi Utami (E061221046)

The rapid evolution of the digital technologies of today has ushered in a new era of global
trade economic interactions and development, profoundly impacting the landscape of
international trade and monetary systems. This transformation has sparked intense debates
and discussions within the realm of International Political Economy (IPE), where diverse
perspectives of converge to analyze and address the contemporary challenges and
opportunities. At the heart of it, these discussions lies on the liberal perspective, a
foundational of pillar in IPE that champions the principles of free trade, open markets, and
minimal government intervention. Emerging as a dominant paradigm in the post - World War
II era, the liberal perspective has shaped the international trade policies, institutions, and
agreements, aiming to foster more economic growth, prosperity, and cooperation among
nations. The liberal perspective posits that reducing barriers to trade, including tariffs, quotas,
and regulatory impediments, leads to increased efficiency, specialization, and overall welfare
gains for participating countries. It advocates for the removal of distortions in the global
markets, promoting competition, innovation, and technological advancement as drivers of
economic progress and development. Expanding on the liberal trade principles, we can delve
more into historical examples of successful trade liberalization efforts and their impacts on
economic growth and development. For instance, the reduction of tariffs and trade barriers in
the European Union's Single Market led to increased trade flows and economic integration
among member states, contributing to overall prosperity. Additionally, the role of institutions
like the World Trade Organization (WTO) in promoting liberal trade policies and resolving
trade disputes can be highlighted as crucial mechanisms for maintaining a rules-based
international trading system. In this section, we can provide more specific data and examples
to illustrate the severity of climate change impacts. For instance, citing reports from the
Intergovernmental Panel on Climate Change (IPCC) can offer detailed insights into the
scientific consensus on climate change and its projected effects on ecosystems, agriculture,
and human populations. Additionally, highlighting real-world examples of extreme weather
events, such as hurricanes, wildfires, and floods, can underscore the immediate need for
action. Liberal principles offer a robust foundation for designing trade policies that
effectively contribute to climate change mitigation efforts. By promoting free trade,
incorporating environmental considerations, and fostering international cooperation,
countries can advance their climate objectives while simultaneously promoting economic
growth and prosperity. One way in which liberal trade policies can support climate change
mitigation is by facilitating the diffusion of clean technologies and renewable energy sources
across borders. Removing tariffs and non-tariff barriers on environmentally friendly goods
and services can help lower the costs of adopting clean technologies, making them more
accessible to a broader range of countries. For example, the elimination of tariffs on solar
panels and wind turbines can accelerate the transition to renewable energy in both developed
and developing economies. Moreover, trade agreements can include provisions that promote
the mutual recognition of environmental certifications and standards, further facilitating the
global exchange of clean technologies. Liberal trade policies can also incentivize sustainable
production practices by incorporating environmental standards and certifications into trade
agreements. For instance, trade agreements may include clauses that require participating
countries to adhere to certain environmental standards, such as limits on greenhouse gas
emissions or sustainable resource management practices. By incentivizing businesses to
adopt eco-friendly practices through trade preferences or market access benefits, countries
can promote sustainability while ensuring a level playing field for trade. Moreover, initiatives
that certify products as environmentally friendly, such as the Forest Stewardship Council
(FSC) certification for sustainably sourced wood products, can be recognized and supported
through trade agreements, further incentivizing sustainable production practices globally.
Liberalism emphasizes the importance of international cooperation and multilateralism in
addressing global challenges, and climate change is no exception. Through forums such as
the United Nations Framework Convention on Climate Change (UNFCCC) and the World
Trade Organization (WTO), countries can negotiate agreements that promote sustainable
development while respecting the principles of free trade. For example, the Paris Agreement,
adopted under the auspices of the UNFCCC, encourages countries to enhance their climate
pledges while promoting international cooperation and support for climate action. Similarly,
the WTO provides a platform for countries to discuss trade-related aspects of environmental
protection and sustainable development, facilitating dialogue and collaboration on trade and
climate change issues. To illustrate the effectiveness of liberal trade policies in driving
climate change mitigation efforts, we can provide case studies and examples of successful
initiatives from around the world. For instance, the Renewable Energy and Energy Efficiency
Partnership (REEEP), a global partnership that promotes clean energy deployment through
international collaboration, showcases how liberal principles can drive climate action.
Additionally, trade agreements such as the European Union's Comprehensive Economic and
Trade Agreement (CETA) with Canada, which includes provisions on environmental
protection and sustainable development, demonstrate how trade can be used as a tool to
advance climate objectives while promoting economic growth. In this section, we can explore
in more detail the criticisms leveled against liberal trade policies and their potential impact on
environmental sustainability. Providing case studies of instances where trade liberalization
led to environmental degradation, such as deforestation in the Amazon rainforest driven by
agricultural expansion, can offer concrete examples of the "race to the bottom" phenomenon.
Additionally, discussing the complexities of balancing environmental protection with trade
interests in specific contexts, such as debates over carbon border adjustments or the
regulation of environmentally harmful products, can provide a nuanced understanding of the
challenges involved. Expanding on the conclusion, we can emphasize the importance of
ongoing dialogue and collaboration among policymakers, businesses, and civil society to
address the complex interplay between trade and climate change. Highlighting emerging
trends, such as the growing momentum behind sustainable finance and green investment, can
underscore the potential for innovation and partnership in driving forward progressive trade
policies that prioritize both economic prosperity and environmental sustainability. Ultimately,
the conclusion that can reinforce the message that embracing liberalism in trade policy offers
a pathway towards a more sustainable and resilient future for all.
 Reference
Dawson, J., Holloway, J., Debortoli, N. et al. Treatment of International Economic Trade in
Intergovernmental Panel on Climate Change (IPCC) Reports. Curr Clim Change Rep 6, 155–
165 (2020). https://doi.org/10.1007/s40641-020-00163-x

World Trade Organization. Activities of the WTO and The Challenge of Climate Change.
Accessed May 6, 2024.
https://www.wto.org/english/tratop_e/envir_e/climate_challenge_e.htm.

World Trade Organization. Trade and Climate Change. Retrieved May 6, 2024, from
https://unfccc.int/sites/default/files/part_iv_trade_and_climate_change_report.pdf.