Scrap Tariffs On Green Goods

Scrap Tariffs On Green Goods

Tariffs should be scrapped for green goods like solar powered stoves, water
saving showers and wind turbine parts, Gareth Thomas argued yesterday. 

Speaking at the World Trade Organisation (WTO) in Geneva, the Minister for
Trade and Development said the move would encourage the widespread use of
environmentally-friendly low-carbon products.  At present, applied tariffs on
these products can be as high as 27%.

Low carbon production is the most cost effective way to produce energy and
could help to reduce poverty in some of the world’s poorest countries, as well
as allow people to work, trade and live in a more environmentally-friendly way. 

Speaking at the WTO, Gareth Thomas said:

“Low carbon technology has huge untapped potential in many developing
countries and could offer massive environmental and financial benefits. 

For too long, the opportunities for green growth in developing countries have
been held back by restrictive import taxes.  

“If we really want to promote green technologies then we all have
to do our bit
to get trade flowing freely.  As we approach the
Copenhagen summit, rich and poor countries alike need to take urgent steps to
reduce or remove the
tariffs that green imports are subjected to.”

The move is not without precedent.  In 1997, after the Uruguay Round on
trade, tariffs on IT goods were abolished in order to get the sector moving.  As
a result of this, by 2005, members of the agreement made up 97% of the
world trade in IT products.

A similar strategy on green goods would make a crucial difference to the
distribution of products like wind turbine parts and solar powered cookers.

Over 30 members of the WTO have no commitment at all to set tariff levels in
key products such as wind turbine masts or solar powered cookers.  Very small
numbers have committed to applying no tariffs at all on a number of these
products.  

Some developed countries are still applying tariffs of up to 27% on wind
turbine masts for example, and a significant number of developing countries have
very high tariffs on these products.