International Conversations on Trade and Climate: From the World Trade Organization to the United Nations Framework Convention on Climate Change

As the 14th Ministerial Conference (MC14) approaches, debates over the trade impacts of climate measures are increasingly present in World Trade Organization (WTO) discussions. This makes MC14 a timely moment to take stock of how these debates have evolved, and of the issues that are now crystallizing across international forums. 

This article reviews recent policy developments and international discussions on trade and climate in the lead-up to MC14, focusing in particular on exchanges at the WTO and at the 30th United Nations Climate Change Conference (COP 30). It shows how the growing implementation of climate-related trade measures has shifted conversations from abstract principles to practical questions of transparency, interoperability, and development, and considers what this evolving landscape means for discussions at MC14 and beyond. 

Real-World Developments in 2025 and Early 2026

The years 2025 and early 2026 marked a turning point in the global trade–climate landscape, as climate-related trade measures increasingly moved from abstract policy debates to concrete implementation. 

Most notably, the European Union’s Carbon Border Adjustment Mechanism (CBAM) entered its definitive phase in January 2026, and further downstream scope expansion has been proposed by the Commission. If such an expansion were agreed, it would add another 180 steel- and aluminum-intensive products, including machinery and appliances, to the current CBAM coverage. 

The EU’s mechanism is not the only border carbon adjustment measure on the books. The United Kingdom published draft legislation for its CBAM, which will enter into force on January 1, 2027. In Australia, Canada, and Chinese Taipei, similar instruments are being actively explored. Brazil and Türkiye, while working on establishing their emissions trading systems, explicitly reference carbon leakage risks and potential policies to address them in their respective legislations. This reflects an early recognition that carbon pricing design cannot be decoupled from trade exposure and leakage risk, even in jurisdictions that are not currently considering the adoption of border carbon adjustments (BCAs). 

The trade and climate debate, though, also addresses the role of forests as carbon sinks. In December 2025, the European Council formally adopted the targeted revision of the EU Deforestation Regulation. Large and medium operators will now be required to comply by December 30, 2026, while small and medium enterprises will have until June 30, 2027. 

International Discussions on Trade and Climate at the WTO and COP 30 in 2025 

These real-world policy developments have been closely reflected in international discussions on trade and climate, notably within the WTO and at COP 30. The main issues driving these discussions were concerns about the consistency of such measures with both the WTO rules and the Paris Agreement, the question of interoperability across different regimes, the cumulative administrative burden faced by exporters, and the capacity of developing countries to comply with them. 

Progress at the WTO 

At the WTO, the topic of climate-related trade measures and BCAs has been the subject of considerable debate, with a total of 251 oral interventions and written communications across different committees and other WTO bodies and processes by 67 WTO members (EU members are counted separately) and eight groups (e.g., Least Developed Country Group, African Group) throughout 2025. The tone of official statements largely reflects the state of the trade and climate debate: calls for better international cooperation gained ground. However, they are met with a steady stream of concerns about the impact of climate-related trade measures on trading partners. 

Important contributions from the WTO members over the last few years reveal three recurring themes: 

First, equity and development concerns, raised most explicitly by the African Group in 2023 and the LDC Group in 2025, focus on potential risks caused by Trade-related Climate Measures (TrCMs) to market access, development prospects, and the Common But Differentiated Responsibilities and Respective Capabilities, unless they are accompanied by support measures. accompanied by support measures. 

Second, fragmentation and compliance costs emerge as a shared concern across the proposals by China and Japan in 2024. China focuses on reducing trade frictions and improving interoperability across TrCMs, while Japan zeros in specifically on the fragmentation of methodologies for measuring embedded emissions as the key technical problem the WTO should address. 

Third, there is a convergence around the WTO’s potential role as a technical and transparency forum, particularly within the Committee on Trade and Environment. The group proposal by Australia, Chile, Costa Rica, Israel, Japan, the Republic of Korea, New Zealand, and the United Kingdom (hereinafter “Japan and Korea-led” group proposal) in 2025 explicitly supports non-binding guidance and technical cooperation, while developing country submissions implicitly condition acceptance of TrCMs on enhanced assistance, capacity building, and inclusive dialogue. 

Overall, the submissions point less toward consensus on the legitimacy of specific TrCMs and more toward shared recognition of the need for cooperation, proportionality, and development-sensitive implementation if such measures continue to expand. 

Within the WTO, 2025 has marked a meaningful shift of trade and climate conversations toward the multilateral format, in particular at the Committee on Trade and Environment (CTE), which seems to have focused on closer analysis of three particular aspects of TrCMs: transparency, interoperability, and the development dimension, which were identified by the current CTE Chair, Swiss Ambassador Erwin Bollinger, after consulting the WTO members. Members will continue discussions on those three pillars in 2026. 

In parallel, 79 WTO members participating in the Trade and Environmental Sustainability Structured Discussions (TESSD) continued their exchanges at the TrCMs Working Group. The main outcome of this process has been the development of a Compilation and Mapping of Trade-related Climate Policies, aimed at enhancing transparency and mutual understanding. While TESSD discussions also touched on practical design issues, including interoperability, these elements were not reflected in the outcome product. This product, along with other TESSD deliverables, is expected to be presented at MC14. 

Discussions at COP 30 

After two weeks of tension around trade-related issues at COP 30 in Belém, Brazil, a Mutirão (a Brazilian Portuguese term referring to a collective, collaborative effort or joint undertaking) decision has established three technical dialogues "to consider opportunities, challenges and barriers in relation to enhancing international cooperation related to the role of trade" that will take place at the 2026, 2027, and 2028 United Nations Framework Convention on Climate Change (UNFCCC) subsidiary bodies meetings. Those discussions will be summarized in a report to be presented at a high-level event in 2028. This is a first introduction of the trade topic into the multilateral UNFCCC conversations, and it is not yet clear what the focus or format of such exchanges will be. While it is the climate-related trade measures that were at the heart of the COP debates, the list of potential topics can be much broader, including trade’s role in support of green transition or of climate adaptation priorities. 

At COP 30, the Brazilian COP Presidency has also launched its own initiative: the Integrated Forum on Climate Change and Trade (IFCCT). The hosts of the initiative are currently consulting potential IFCCT participants on possible modalities and thematic focus; however, it was made clear that all proceedings of IFCCT will be non-binding, non-negotiated, and non-attributable. Just as the technical dialogues at the UNFCCC subsidiary bodies meetings, the IFCCT is also intended to run for an initial 3-year phase until the end of 2028. 

The Meaning of MC14 

In this evolving context, MC14 is best understood as a moment of taking stock and potentially consolidation of the key themes of debate in the trade and climate thematic, rather than a breakthrough. In 2025, the WTO members clearly changed gear after moving the discussion on trade and climate to a multilateral format and began defining the problems the organization will need to continue focusing on in 2026. Much of this momentum reflects the work of the current CTE Chair, Swiss Ambassador Erwin Bollinger, who introduced interactive sessions alongside standard thematic meetings and helped shift engagement from the plurilateral format to the multilateral CTE exchange. The next steps on transparency, such as the template presented in the Japan and Korea-led proposal and the willingness from members to conduct a pilot exercise in June 2026, are expected to be discussed at the last CTE meeting before MC14. 

It is an important step forward—but the conversations on interoperability and development dimension will demand much more engagement, both from diplomats and from stakeholders, in the coming months. They remain fundamentally important discussions to have, and hopefully, the transparency exchange will strengthen WTO members’ trust in the organization’s ability to tackle them. It is significant that the work on trade and climate will also be picked up at the UNFCCC meetings this year. This will be an interesting space to watch. Conversations on trade and climate bring both political tension and practical challenges, as policy moves at different speeds and risks fragmenting markets. Well managed, though, these new forums for debate could prepare the ground for greater understanding and opportunities for practical cooperation that are urgently needed.