Washington, D.C. — In response to China’s announcement today that it will launch a trade challenge against the U.S. Inflation Reduction Act’s (IRA’s) tax credits for electric vehicles, the Trade Justice Education Fund’s Executive Director Arthur Stamoulis released the following statement
“Immediate climate action must take priority over compliance with outdated trade rules that were inked long before governments worldwide began taking the climate crisis seriously. China’s threatened trade attack against climate provisions in the U.S. Inflation Reduction Act is another example of why the U.S. and other nations should begin working with one another towards an immediate moratorium on the use of trade challenges against clean energy transition and other climate measures.
“Governments worldwide are wasting considerable amounts of time and political capital attempting to squeeze potential climate measures into compliance with outdated trade and investment rules. Ultimately, existing trade rules need to be rewritten so that trade pacts can become tools for helping the world advance towards a clean, just and sustainable economy — but we don’t have time to wait. A “Climate Peace Clause” that brings an immediate end to the ongoing trade attacks against climate measures is a necessary interim step towards helping governments transition to clean energy on the rapid timeline that is required to head off the worse possible impacts of climate change.
“A moratorium on the use of international trade agreements to challenge climate policies would: (1) help governments safeguard existing climate mitigation and transition measures by protecting them from trade challenge; (2) create the space for governments to adopt the bolder climate policies that justice and science demand without fear or threat of trade challenges; and (3) incentivize and offer countries time to work together and resolve the underlying tensions between current trade law and the imperative for climate action.”
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