In the past year, the initiative has made solid progress under the high-level work plan set by the Joint Ministerial Statement at MC12. Participants committed to work over the coming weeks to finalise a set of options for undertaking concrete follow-up actions, with the intention of presenting them for ministers' consideration at MC13. Co-sponsors will also develop a timetable for the more in-depth work anticipated through 2024.

Delegations elaborated on the three areas of focus for concrete follow-up action in the lead-up to MC13 and in 2024. First, on enhancing transparency, members discussed how to make fuller use of the Trade Policy Review (TPR) mechanism by developing a short list of questions on fossil fuel subsidies and FFSR for regular use in TPRs and promoting FFS-related information in TPR documentation.  

Second, on the topic of crisis support measures, members proposed consolidating and expanding information presented at earlier FFSR meetings to compile information on members' recent experience on fossil fuel support measures to address energy crises. This compilation would be periodically reviewed and efforts to reform, reduce and remove such measures would be encouraged. Drawing on this experience, co-sponsors suggested the development of practical guidelines to help ensure such crisis support measures remain targeted, transparent and temporary.

Third, on addressing the most harmful FFS, next steps proposed included examining information and analysis of current forms of fossil fuel subsidies to identify the characteristics of the most harmful ones to the environment and trade and considering possible pathways for reform of those categories. Looking at how to develop a broader understanding of the particular types of subsidies of most concern, including through focused workshops in 2024, was also proposed.

Participating delegations were also brought up to date on recent research and developments in other international processes relevant for FFSR work.

The Organisation for Economic Co-operation and Development (OECD) presented the latest trends in the fiscal cost of support measures for fossil fuels, based on its 2023 update of the Inventory of Support Measures for Fossil Fuels that will be published shortly.

The International Institute for Sustainable Development (IISD) noted that the 2022 energy price crisis catapulted public financial support for fossil fuels to new levels, with G20 governments reacting to the peaking fossil fuel prices with USD 1.4 trillion in the form of subsidies (USD 1 trillion), investments by state-owned enterprises (USD 322 billion), and lending from public financial institutions (USD 50 trillion).

The Forum on Trade, Environment and SDGs (TESS) reported on the paper it is working on with options for inclusive and collective actions at the WTO. The paper aims at reviewing which are the biggest and more pressing subsidies and identifying key categories where collective action will best serve its purpose.

More information about the FFSR initiative is available here.