I've complained before about the lack of transparency in bilateral and regional trade agreements, so I appreciate the public virtual session of the Inaugural Meeting of the Environment Committee of the USMCA/CUSMA/T-MEC. And I appreciate our excellent Cato Trade Policy Center RA Alfredo Carrillo Obregon for putting together a transcript of the event, which you can find here.
In addition to prepared statements by government officials, the session also offered the opportunity for the public to ask questions, and some of them were interesting. Here's one about the possibility of bringing the Paris Agreement into the USMCA:
Q: Will the parties act to include the Paris Climate Agreement within the CUSMA, including prioritizing climate obligations over conflicting trade rules in the agreement? Is that something that is being planned at all?
Kelly Milton (USTR)
I would just note that our administration and our agency leadership in particular has really emphasized the fact that the United States is committed to considering a range of trade tools to contribute to our whole of government approach to combat climate change. With respect to this specific question about the Paris Agreement, we are certainly continuing to analyze whether adding the Paris Agreement to the list of multilateral environmental agreements in USMCA would in fact make a positive contribution to addressing the climate crisis.
Doug Forsyth (CAN)
Taking action to protect the environment and combat climate change are top priorities for the Canadian government. To this end, we recently announced a new commitment to enhance our emissions reduction target under the Paris Agreement by 40 to 45% below our 2005 levels, and to do so by 2030. Although, as rightly noted climate change isn't explicitly referenced in the CUSMA, climate change remains a priority for Canada, we will continue to advance trilateral cooperation with our close partners through the ongoing work of the Commission for Environmental Cooperation as well as throughout this chapter to work under this chapter. We also look forward to working with US and Mexico in other fora, such as the WTO, to advance collaboration on trade related climate action.
In some ways, it may seem like a no-brainer for the Biden administration to push for the inclusion of the Paris Agreement in the USMCA list of multilateral environmental agreements. They want to engage on climate change issues, and they want to show the value of the USMCA, for which U.S. Trade Representative Katherine Tai was a key player in the negotiations.
And it may be worth noting that the question was asked in somewhat of a general manner, but the USTR official brought up the specific issue of adding the Paris Agreement to the USMCA list. (See Article 24.8, paras. 4 and 5 for the relevant provisions. For more background, see this post from Risa Schwartz).
However, I can imagine the USTR folks would see a problem with an approach that only makes the Paris Agreement enforceable among three of its parties. Perhaps they would prefer to start with an effort to make the Paris agreement enforceable for all its signatories.
My own view on these sorts of issues is that the best approach is to include an enforcement mechanism in the non-trade agreement itself, rather than making it enforceable through a trade agreement. If governments want the Paris Agreement to be enforceable, they could do that directly in the Paris Agreement. Having trade agreements acts as general global governance agreements is likely to cause controversy (and has done so in the past), and it would be a mistake to go further with such efforts. There may be short term political "wins" from doing this, but in the long term it makes the trade and global governance regimes more fragile.
