14 DAY TRIAL // A “green trade war” between the United States and some of its key economic partners could become an imminent possibility, a leading group of industrialists told the Congress in a recent letter. The confrontation could be triggered by the fact that the new climate bill, which is scheduled to go into voting soon, holds provisions that would allow the state to impose higher tariffs on energy-intensive goods imported from other countries. That is to say, goods from the steel, glass, paper and cement industries could become a lot more expensive when imported, if the companies or countries manufacturing them release large amounts of greenhouse gases in the process.
The over-taxation of these products would create unfair competition, some analysts believe, especially in the eyes of the World Trade Organization (WTO), from which the group expects retaliation if the laws will go into effect. The same type of measures will most likely be taken against the state of California, which barred the import of oil extracted from polluting sources, such as tar sands. Canadian companies threatened they would involve the WTO in the matter, claiming that the measures discriminated against them, their prices and their products.
“We urge the Senate to refrain from including provisions that could negatively impact US relations with key trading partners and disrupt the global trading systems. Climate change is a global problem that calls for international cooperation, not unilateral ultimatums,” a number of industry groups, including the US Chamber of Commerce and the National Foreign Trade Council, wrote in a letter to the Senate leaders, Reuters informs. The main objections are related to so-called “border adjustment” programs, which will essentially allow the government to take extra energy-intensive products starting 2020.
The group also showed that the “highly inflexible” measures adopted by the House had already spurred intense criticism from economic partners. Separately, China and India have expressed their opposition to the new bills, saying that the developed world is to blame for the worsening state of the environment, and that it should not hinder the development of other states, now that they can afford to do so. “In fact, these provisions are already stirring consternation among some of our key trading partners and could trigger a green trade war,” the letter said.