UK trade policy and climate change: Maximising commercial, climate and development outcomes

The paper outlines how the UK can align its trade policy with the Paris Agreement to capitalise on a low-carbon market estimated at £1.0–1.8 trillion annually by 2030. It identifies UK strengths in offshore wind, gas turbines, and financial services, and proposes a structured approach to FTAs. The authors categorise FTA provisions into 'triple wins' (tariffs, services, and standards), 'policy coherence' (intellectual property and procurement), and 'policy cooperation' (sustainable development chapters, private standards, and environmental taxes). It concludes with a checklist for policy-makers to ensure trade deals support climate-resilient development.

• The global demand for low-carbon goods and services, driven by the Paris Agreement and Nationally Determined Contributions (NDCs), is projected to be worth between £1.0 trillion and £1.8 trillion per year by 2030.
• The UK possesses strong comparative advantages in several low-carbon sectors, specifically in offshore wind, gas turbines, motor vehicles and parts, aircraft, insurance, and weather and climate modelling.
• Analysis of NDCs from 10 focus countries (BRICS plus Bangladesh, Colombia, Kenya, Indonesia, and Pakistan) reveals significant complementarity with UK strengths, particularly in China and India.
• Certain FTA provisions are identified as 'triple wins' because they can deliver commercial, climate, and development benefits with minimal trade-offs: the reduction of tariffs on low-carbon goods, enhanced access for trade in services and establishment, and the alignment of product standards and technical regulations.
• The UK's financial and insurance sectors represent a major commercial opportunity for supporting NDCs; the global green finance opportunity alone is estimated to be between £66 billion and £280 billion per year by 2030 if the UK acts as a hub.
• There is a potential tension between trade and climate objectives regarding intellectual property (IP) and technology transfer, as 63% of all NDCs explicitly reference technology transfer as a condition for their contributions.
• The authors argue that strong intellectual property protections in FTAs are more beneficial than mandatory technology transfer, as weak IP enforcement discourages the foreign direct investment needed to meet NDCs.
• Government procurement presents a commercial opportunity but often includes 'buy-local' schemes that act as barriers; the paper suggests using FTAs to negotiate national treatment or time-bound exemptions for environmental investments.
• While sustainable development chapters in FTAs signal intent and support dialogue, empirical evidence is inconclusive on whether they actually produce environmental effects.
• Carbon border adjustment mechanisms (BAMS) are described as highly contested and potentially protectionist; the paper suggests the UK should instead promote collaboration on carbon pricing.

APA

Brown, P., Low, L. P., & Booth, K. (2017). UK trade policy and climate change: Maximising commercial, climate and development outcomes. Climate and Development Knowledge Network. https://cdkn.org/sites/default/files/files/Climate-change-and-trade-WP_Pr4Final_WEB.pdf

Chicago

Brown, Phil, Lit Ping Low, and Katharine Booth. UK trade policy and climate change: Maximising commercial, climate and development outcomes. Climate and Development Knowledge Network, 2017. https://cdkn.org/sites/default/files/files/Climate-change-and-trade-WP_Pr4Final_WEB.pdf.

Wikipedia

{{cite report |last1=Brown |first1=Phil |last2=Low |first2=Lit Ping |last3=Booth |first3=Katharine |title=UK trade policy and climate change: Maximising commercial, climate and development outcomes |publisher=Climate and Development Knowledge Network |date=September 2017 |url=https://cdkn.org/sites/default/files/files/Climate-change-and-trade-WP_Pr4Final_WEB.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{brown2017trade, author = {Brown, Phil and Low, Lit Ping and Booth, Katharine}, title = {{UK trade policy and climate change: Maximising commercial, climate and development outcomes}}, institution = {Climate and Development Knowledge Network}, year = {2017}, month = sep, url = {https://cdkn.org/sites/default/files/files/Climate-change-and-trade-WP_Pr4Final_WEB.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }