Leveraging Trade to Support Climate Adaptation in Developing Countries

International Institute for Sustainable Development (IISD)

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Abstract: The current international trade system was built on the back of a relatively stable global climate. However,the world is now on the path to reach an average temperature of 1.5 C° above pre-industrial levels before the middle of this century (Intergovernmental Panel on Climate Change [IPCC],2019). Gradual changes in climate (rising temperatures,changing rainfall patterns) combined with more frequent and extreme weather events are increasing the risks of trade disruption. Climate change is a pervasive,systemic threat whose impacts affect trade. Measures are needed to anticipate and manage them to minimize disruptions and losses. At the same time,trade can also be an important vehicle for helping countries deal with the impacts of climate change more broadly. Specifically,trade provides an opportunity to support climate adaptation: it offers entry points for developing countries to a) access goods and services needed for adaptation,b) invest in critical products and services that will reduce climate risks in their own country and abroad,c) access trade-related financing mechanisms that support climate adaptation and d) establish trade-related international collaborative frameworks in support of climate adaptation. Taking full advantage of these opportunities will require trade negotiators to understand the climate-related vulnerabilities and adaptation priorities of different countries and regions.