A Dutch research team has analysed the effect of agricultural trade liberalisation on global greenhouse gas emissions. Their study finds that a full liberalisation of agricultural trade (ie, removal of all trade barriers, quota and subsidies globally) would result in a 6% increase in global greenhouse gas emissions in 2015.
Most of this emissions increase would come from land-clearing in developing countries to create new land for agricultural production, and increased numbers of cattle in extensive farming regions that produce meat less efficiently than in high-intensity production countries. By 2030 and beyond, the global increase in emissions would level off again as increased emissions from countries benefiting from trade liberalisation would be balanced by reduced emissions in countries negatively affected by liberalisation.
This study raises some interesting problems for New Zealand and in particular Tim Groser, who is Minister in charge of both trade and international climate change negotiations. New Zealand is a strong advocate for trade liberalisation, but what if free trade increases the risks of damaging climate change?
The recent study provides some interesting regional details: for example, under a scenario where only trade barriers are removed but existing milk quota are retained, dairy production in Australia and New Zealand increases more than under a full trade liberalisation scenario, as well as leading to a much smaller increase in global greenhouse gas emissions. This shows that specific details about trade liberalisation could matter for both New Zealand’s economy and the global environmental impact of trade agreements.
Perhaps the biggest problem for New Zealand is that at present, we have a very limited capacity in this country to engage in such modelling and to test the various assumptions and conclusions coming out of overseas studies. Work by Caroline Saunders at Lincoln university is probably the most advanced in this regard, but their most recent study on the same subject did not simulate the global changes in greenhouse gas emissions associated with land-use changes, let alone the interaction between agriculture and deforestation under alternative trade agreements.
This lack of domestic capacity to fully understand the interactions between agricultural and trade policies with climate change presents a major challenge for New Zealand, particularly if the government wants to make a science-based case in international fora such as the Doha trade talks on how to combine liberalising agricultural trade policies with the urgent need to limit the growth in global greenhouse gas emissions. Having to rely on research carried out in countries that act as competitors in a global market may not be the most robust strategy.
Incidentally, Caroline Saunders from Lincoln university will give a talk on carbon footprints, life-cycle analysis and foodmiles as part of a seminar series organised by the New Zealand Climate Change Research Institute on 15 October 2009 in Wellington. (Disclosure of conflict of interest: I work for the New Zealand Climate Change Research Institute)