Trade policy is emerging as a critical tool for accelerating global climate action. The growing intersection of climate and trade policy could present opportunities for enhanced international cooperation. 

Over the years, trade issues have been raised under the United Nations Framework Convention for Climate Change (UNFCCC) process, with parties holding different views as to whether it is an appropriate forum to discuss trade-related climate measures (TRCMs). Nevertheless, at COP30, Parties agreed to discuss “opportunities, challenges and barriers in relation to enhancing international cooperation related to the role of trade,” starting in June 2026. The Global Climate Action Agenda (GCAA) also launched a dedicated channel or “activation group” on climate and trade. 

The Paris Agreement highlights that the outcomes of the global stocktake (GST) should inform Parties in enhancing international cooperation for climate action (Article 14, paragraph 3). In this context, the GST decision reaffirms that Parties should avoid arbitrary, unjustifiable, or disguised restrictions on international trade. Hence, trade policy may serve as a vehicle for implementing GST outcomes and strengthening international climate cooperation.  

As they prepare for the climate and trade dialogues, Parties and non-Party stakeholders could consider how TRCMs can enhance international cooperation to accelerate the outcomes of the first GST (GST1). The GCAA is aligned with the GST1 and can support these efforts. 

Accelerating the outcomes of GST1 through trade  

Climate and trade are both intimately connected to sustainable development goals. Several GST1 outcomes can be linked to economic sectors and have target dates, providing a useful framing for climate, sustainable development, and trade agendas to converge. These include tripling the global renewable energy capacity and doubling the annual rate of energy efficiency improvements, and the transition away from fossil fuels (TAFF) in energy systems to achieve net zero global emissions by 2050. 

TRCMs can enhance international cooperation to achieve relevant GST1 outcomes, advancing sustainable development goals in the context of the Paris Agreement. Properly designed and implemented TRCMs may foster and enable:  

• climate-resilient supply chains through diversification, transparency, risk management, and circular economy approaches  

• technological innovation towards climate solutions 

• cost-efficient low-carbon products and technologies with green industrial policies and market mechanisms that incentivize production and consumption of low-emission goods   

• interoperable technical frameworks, i.e., those linked to emissions measurement, reporting, and verification, carbon accounting, and life cycle assessments. These frameworks can support policies that foster market recognition and differentiation of sustainable products and infrastructure 

• local value generation, including fiscal and labor-related benefits linked to foreign investments, the upskilling and reskilling of the workforce across clean technology supply chains, and community benefit-sharing for the extraction and processing of transition minerals and metals.  

International equity considerations should be embedded in TRCMs, recognizing equity’s importance for a just transition.  

The Role of National Policies and Trade Agreements 

National policies are a critical vehicle for advancing GST outcomes and can have implications for trade. For example, green industrial policies, such as subsidies for the development or production of renewable energy technologies, may alter the costs of traded goods. Simultaneously, trade policies supporting open and resilient economic systems impact climate goals.  

Climate-focused trade agreements, such as the Agreement on Climate Change, Trade, and Sustainability (ACCTS) demonstrate that trade can drive cooperation towards achieving GST goals such as TAFF and tripling renewable energy capacity and doubling energy efficiency. For example, fossil fuel subsidies reinforce economic inefficiencies and slow the transition. The ACCTS is the first legally binding trade agreement to introduce specific provisions restricting fossil fuel subsidies, thereby reducing some forms of government financial support that would otherwise obstruct the TAFF. Tariff and non-tariff barriers on renewable energy products raise the cost associated with these technologies. The ACCTS reduces trade barriers for environmental goods and services, including those related to renewable energy and energy efficiency. This can reduce the cost of accessing these goods, enabling economies of scale and sourcing from the lowest-cost producers.  

Looking Ahead: Informing GST2 

The second GST notably culminates in 2028, coinciding with a mandated high-level event on climate and trade, in the context of the UNFCCC climate and trade dialogues. And the GCAA with climate action plans or “plans to accelerate solutions” run through at least 2028.  

This alignment creates an opportunity to examine how and whether trade could inform GST2.