Greening Trade and the WTO: Africa’s Offensive and Defensive Interests

Aligning trade and environmental objectives has become a growing priority in global economic governance. At the World Trade Organization (WTO), this shift reflects increasing recognition that trade policy can support efforts to address climate change and broader environmental challenges. Several initiatives have emerged in this area, including the Trade and Environmental Sustainability Structured Discussions (TESSD), the Dialogue on Plastics Pollution and Sustainable Plastics Trade, and the Fossil Fuel Subsidy Reform (FFSR). In parallel, discussions have intensified on the environmental implications of subsidies and industrial policy within the WTO framework. This policy brief examines these evolving debates from an African perspective, focusing on three areas: environmental initiatives at the WTO, discussions on green industrial policy and subsidy rules, and emerging debates on sustainable agriculture.

Trade and environment discussions within the WTO have historically sought to reconcile trade liberalisation with environmental protection. Institutional mechanisms such as the Committee on Trade and Environment (CTE) were created to explore this relationship, yet progress in key areas, such as liberalising environmental goods and services—has been limited. Recent developments include the Agreement on Fisheries Subsidies, the first WTO agreement with explicit environmental objectives, though its implementation remains incomplete. Alongside multilateral negotiations, plurilateral initiatives such as TESSD and the plastics dialogue have gained momentum. African participation in these initiatives, however, remains limited, reflecting concerns that such discussions are primarily driven by developed economies and may impose new constraints on developing countries’ market access or policy space.

In contrast, African countries have been more actively engaged in debates around green industrial policy and the reform of WTO subsidy rules. In recent years, the African Group has proposed reforms to the Agreement on Subsidies and Countervailing Measures (ASCM) and the Agreement on Trade-Related Investment Measures (TRIMs). These proposals aim to expand policy space for developing countries to pursue industrialisation strategies, including the use of green subsidies, local content requirements, and measures supporting technology transfer. The proposals reflect both defensive and offensive interests: limiting the trade-distorting effects of green subsidies adopted by advanced economies while ensuring that developing countries retain the flexibility needed to pursue green industrialisation and structural transformation.

Agriculture represents another key dimension of the trade–environment nexus. Agricultural subsidies remain central to debates on sustainability due to their environmental impacts and their role in shaping global production patterns. While some WTO members advocate repurposing agricultural subsidies toward environmentally sustainable practices, such reforms raise complex challenges for African countries. Shifting subsidies toward sustainability objectives could create trade-offs with food security and exacerbate existing asymmetries in subsidy capacity between developed and developing economies.

Overall, Africa’s engagement in trade and environment discussions reflects a strategic balance between caution and advocacy. While participation in some environmental initiatives remains limited, African countries are increasingly active in shaping debates on industrial policy and subsidy reform. However, broader structural challenges—including fiscal constraints, limited policy coordination, and gaps in finance and skills—remain key barriers to advancing green industrialisation on the continent.