WTO NEWS: SPEECHES — DG ROBERTO AZEVÊDO


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> Roberto Azevêdo’s speeches

  

Ricardo Meléndez-Ortiz,

Secretary-General Rusnák,

Deputy Secretary-General Kuneralp,

Distinguished guests,

Ladies and gentlemen,

Good morning. I am delighted to be here today.

I would like to thank the ICTSD and the Energy Charter Secretariat for organizing this important event.

We are talking today about how we can work together to improve global governance on clean energy. And in terms of global governance I think 2015 is a very important year.

At the WTO we are marking our 20th anniversary, our members are implementing the package of decisions agreed in Bali, and we are engaged in intensive negotiations ahead of our Ministerial Conference in Nairobi later this year.

At the Energy Charter Secretariat, I know that you are going to be very busy too — not least as you will be holding your Ministerial Conference in The Hague in May.

And, of course, beyond our work there will be many other major milestones, such as the UN’s Summit on the Post-2015 Development Agenda in September and the UN's Climate Change Conference in Paris in December.

With all of this in mind, I think this is the perfect moment to be discussing how we can improve global governance for the future. And I would like to use this opportunity to focus on what we can do together to contribute to a better trading environment for energy — and specifically for clean energy.

There is no question that energy is essential for trade and economic development.

Access to affordable energy gives certainty to businesses, enhances production, provides incentives for technological progress and facilitates transportation.

These are important factors for increasing competitiveness in global markets and boosting sluggish economic growth.

However, there are clearly many challenges in ensuring that these benefits are realised. 

Energy markets are highly concentrated, both in terms of market structure and geographical distribution of resources.

Demand is rising in developing Asia, Latin America, the Middle East and Africa — and there are huge gaps in provision.

In Sub-Saharan Africa two of every three people do not have access to electricity, according to the International Energy Agency. This is 13% of the world's population.

At the same time, renewable energy only forms a small part of the global energy mix.

Renewables, such as solar, hydropower and onshore wind, are increasing their presence on global energy markets. But fossil fuels still represent around 80% of the total market share.

Of course, oil prices fell by almost 50% last year — and are unlikely to rise in the medium term. Therefore, the task of increasing the share of renewables in the energy mix is going to be even tougher.

Indeed, the volatility of energy prices can make it very difficult for investors to plan renewable energy projects. 

By creating a better environment for trade in energy, we can help to support access to energy — and clean energy in particular.

And I think that both the Energy Charter and the WTO have an important role to play.

The Energy Charter is the only energy-specific agreement that covers all major aspects of international energy — from trade and transit to investment and energy efficiency.

And our two organizations have a good track record of cooperation.

I think the current moves towards an 'updated' Energy Charter, mapping out common principles for international cooperation, are very positive and welcome.

And so I am keen that we should seek to further strengthen our dialogue and cooperation.

The WTO clearly has significant interests in energy — but our history shows that it has not always been an easy issue to get to grips with.

Back in 1947, the original text of the Havana Charter for an International Trade Organization contained rules on trade and investment in energy.

These rules dealt with regulating production and with the control of exports and imports of primary resources. Moreover it included the principle of freedom of transit of goods, including energy.

However, the vision of an International Trade Organization could not be fully realised at that time. Instead the General Agreement on Tariffs and Trade was signed which contained only general rules for trade in goods.

Some wanted to revisit this issue in the 1990s in the discussions on the Uruguay Round, which created the WTO. It was suggested that rules on energy should be included in these talks but no consensus could be found.

So, today, the WTO does not have specific rules dealing with trade in energy. However, the rulebook does cover trade in goods, services and trade-related intellectual property rights — and therefore it captures a multitude of elements of trade in energy.

In addition, some steps to include energy-specific commitments have been taken in the services schedules.

Nineteen members have commitments on services incidental to energy distribution in their schedules of concessions, and 12 members have commitments on pipeline transportation of fuels.

As I have indicated, some of our recently-acceded members have incorporated energy-related commitments to their Protocols of Accession.

The WTO dispute settlement system has addressed several energy-related disputes on renewables.

In addition, an effective intellectual property regime canfacilitate investment and development of new technologies that are critical to the expansion of renewables and ensure access to energy infrastructure.

Our rules on subsidies, local content requirement and state trading enterprises are also very relevant to the energy sector.

Indeed, a closer look at the landscape of policies in the energy sector shows that many trade restrictions remain in place.

They range from export restrictions to some labelling requirements on energy products.

The WTO provides transparency mechanisms that can help members to improve their understanding of the links and interactions between trade and energy.

Through all of these avenues, energy issues are increasingly becoming a part of the WTO's day-to-day work.

And some elements are also present in our negotiating agenda.

Our successful Ministerial Conference in Bali in 2013 delivered a real boost to our negotiating efforts across the board.

In January we launched an intensive process of negotiations to agree, by July, a work programme to conclude the remaining issues of the Doha Development Agenda.

Moving this work forward would have numerous implications in the energy sector — but moreover it would free-up the WTO's agenda for the first time in a generation. And this would enable us to look at a range of new issues.

So far we have seen good progress and strong engagement — but of course there is a long way still to go. 

The Doha mandate includes opening trade in environmental goods and services. Indeed, many of the goods and services discussed by members in these negotiations have direct application to clean energy and energy efficiency.

They include goods like solar panels, solar water heaters, hydropower turbines and equipment for biogas production — and services like environmental consulting.

Collective elimination or reduction of trade barriers here would provide WTO members with greater access to a variety of imported goods involving clean energy technologies — and some of the services which support them.

This work could also help to stimulate innovation and facilitate the development of clean energy industries — including in countries where they do not yet exist, allowing for new green business opportunities to flourish.

In July of last year, a group of members launched a process to eliminate tariffs on environmental goods.

These members account for over 85 per cent of global environmental goods trade — and we expect that this process will cover many goods with a direct application to clean energy and energy efficiency.  

This is a significant initiative, which would bring major economic gains. And, crucially, although it is being taken forward by a group of members, the benefits would apply to the whole membership.

So, in conclusion, I think there is a huge amount of interesting work going on in this area.

I see numerous areas where we can look to do more — and where our organisations can work more closely together to improve governance.

By doing so I think we can potentially help to address some of the outstanding issues in the sector — particularly the need for greater access to energy and the need for a greater emphasis on sustainability.

This could help to boost trade, safeguard the environment and improve lives.

So I wish you a productive meeting today.

I look forward to hearing the reports of your discussions here.

And I hope we can collaborate even more closely on these issues in the years to come.

Thank you for listening.

 

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