The UNEP DTU Partnership has recently finalised a project entitled “Trade in Environmentally Sound Technologies: Implications for Developing Countries”, which was undertaken in cooperation with the UN Environment and Trade Hub.
The project aimed at enhancing the understanding of the implications, capacity needs and enabling conditions for trade liberalization of environmentally sound technologies (ESTs) in developing countries.
Key outputs of the project include the preparation of two regional assessments on trade in selected ESTs in the Association of Southeast Asian Nations (ASEAN) and the East African Community (EAC). The ESTs covered in the analyses are of high economic and environmental relevance in the two regions and include technologies, such as wind turbines, solar PV cells, biomass boilers and hydropower turbines.
Identifying main barriers
The reports combines trade flow analysis with policy research and include detailed country-level case studies of trade barriers in the solar PV value chain in Malaysia and Kenya. The development of the reports also relied on inputs from consultations with key stakeholders in the two regions as part of regional workshops. Ulrich Elmer Hansen and Ivan Nygaard from the UNEP DTU Partnership were responsible for coordinating the preparation of the two reports in close cooperation with research institutions in Malaysia and Kenya.
The reports identify the main barriers preventing trade in the selected ESTs in the two regions and points at the growing importance of non-tariff barriers to trade compared to tariff-related barriers given the general decline in tariff rates.
In the EAC region, the main barriers to trade in the selected ESTs include weak compliance with regional policies and protocols, fragmented tax incentives, and burdensome customs entry and importation procedures. In the ASEAN region, the key barriers to trade are related to lengthy procedures for permits and customs clearance, external border agency cooperation, involvement of the trading community and appeals procedures.
The report provides recommendations for policies aimed at removing barriers to trade in the selected ESTs at the regional level, which include enhanced regional cooperation through alignment of regulatory frameworks, capacity building in trade facilitation and full implementation of existing protocols. National-level recommendations regarding strategies to promote trade in solar PV in Malaysia and Kenya include training programs for customs and port officials, capacity building of local solar PV technicians and improved financing mechanisms.