New trade agreement for climate change leaves door open for countries to join


Import & export

About trade

Published: 05 Jul 2024

On Tuesday 2 July, Ministers for Trade from New Zealand, Switzerland, Norway, Costa Rica and Iceland announced the conclusion of negotiations on an Agreement on Climate Change, Trade and Sustainability (ACCTS), the first such agreement to seriously address climate issues.

“It is important that the agreement keeps the door open for more countries to join. They can no longer hide behind each other in global negotiations that are unlikely to be completed. This will help to clarify which countries are serious about their climate ambitions in trade policy,” says Per Altenberg, trade strategist at the National Board of Trade Sweden.

While ACCTS covers only a limited number of countries, it is the first trade agreement that seriously addresses climate issues. It provides answers to several questions that have been discussed for decades within trade policy, such as definitions related to environmental goods and fossil fuel subsidies. The list of environmental goods covered by the agreement includes solar panels, wind turbines, electric vehicles, recycled paper and wood products as environmentally friendly alternatives to fossil-intensive building materials.

The agreement can be regarded as comprehensive since it covers trade in both goods and services, as well as environmental labelling and restrictions on fossil fuel subsidies.

“There is still work to be done before the agreement has been  signed, ratified and entered into force, but the fact that negotiations have been concluded is in itself a bright spot at a time characterised by protectionism. It also shows that trade policy based on cooperation between countries rather than unilateral measures does not end just because large economies like the US have stopped signing trade agreements,” says Altenberg.

Important points of the agreement:

  • Tariffs will be eliminated on over 300 environmental goods.
  • The parties undertake to sustainably manage ecosystems that are relevant to the production of environmental goods.
  • The agreement facilitates trade in more than 100 environmental services.
  • The agreement establishes a new framework for reducing harmful fossil fuel subsidies, including a meaningful definition of fossil fuel subsidies.

The National Board of Trade Sweden will analyse the agreement in detail when all relevant information is available.

Further information:
Joint statement by the signatory countries

Per Altenberg
+46 (0)8 690 49 26