Global Trade’s Bright (Green) Future
Keeping climate change in check will require reducing the carbon footprint associated with global shipping, which accounts for the bulk of world trade. With governments and the shipping industry already moving in the right direction, the challenge will be to agree on policies that are adequate to the scale of the crisis.
PARIS – Most discussions of trade nowadays inevitably feature the words “war,” “tariff,” or “Trump.” But look beyond the headlines and you will see the foundations of a more collaborative, healthy, and sustainable world trade system emerging.
The global shipping industry, which carries 90% of all global trade by volume, has started to acknowledge the urgency of climate change, and is taking steps to minimize its environmental impact. On January 1, 2020, cleaner fuel standards for shipping will take effect globally. After more than a decade of negotiations, member-state governments at the United Nations International Maritime Organization (IMO) have agreed to a new “global sulfur cap,” demonstrating that multilateralism is still possible. The method of powering shipping vessels will now undergo a change on the scale of the shift from coal to oil a century ago.
Under the IMO accord, the shipping industry will be required to reduce sulfur-dioxide and nitrous-oxide pollution on a massive scale. Among other things, the policy ensures that millions of children around the world will have a chance to live healthier lives. Over time, we have learned that these air pollutants can have a deleterious effect not just on our hearts and lungs, but also on brain development. Now that the cap is coming into force, we will soon benefit from the extraordinary effects of a new, permanent global health dividend. We can expect to see data in the coming years indicating reduced health-care costs and improved educational outcomes from around the world.