Understanding what policy measures and tools can be included in the AfCFTA Protocol on trade in services to promote a green transition and generating economic growth.
Home basis
The assignment will be completed in three (3) work months.
Duties and Responsibilities
Background:
The African Trade Policy Centre (ATPC) of the Regional Integration & Trade Division (RITD) is a specialized unit within the United Nations Economic Commission for Africa (ECA). Its mission is to act as the leading Africa-based Centre of excellence and a continental hub for providing and coordinating technical support for the development of trade policies in Africa. ATPC works with stakeholders at all levels to enhance the implementation of sound national, regional and international trade strategies, policies and programs. The Centre also conducts research to generate and disseminate knowledge on trade and provides policy advice, training and capacity building based on the needs identified by its partners.
Africa is expected to be more severely affected by climate change than any other continent, given its size, geographical position, and limited capacity to adapt. There is significant evidence that climate change can have detrimental impacts on trade in Africa as it “reduces agricultural production and yields, damages physical infrastructure, disrupt supply, transport and distribution chains and also harms the biodiversity and natural attractions of which tourism in Africa depends” . Thus, it is imperative to develop mechanisms to help mitigate these impacts on trade.
The pandemic is a stark reminder of the disastrous consequences of environmental degradation. The loss of biodiversity in particular has led to a rise in the instances of zoonotic diseases. Covid-19 has shed light on the fragility of Africa’s supply chains, highlighting the urgency to develop more robust and resilient regional value chains to face future climate change shocks. Trade can help to mitigate climate change and adapt to its adverse effects.
Universal tariff reduction has historically led to an increase of trade in carbon-intensive and environmentally destructive products as it enables greater trade flows by sea, air and land and boosts broader economic activity. It also incentivizes firms to shift to cheaper production locations which is often linked with more polluting geographies . However, if designed appropriately, trade agreements can also be an opportunity to secure the promotion of climate friendly industries and formalize efforts that can eliminate destructive trade-related malpractices. Some analysis also proposed the “Environmental Kuznets Curve” (EKC) hypothesis which suggests a relationship between economic activity and environmental degradation such that there is initially a negative effect, and then a positive effect.
Politically, UN Member States have identified Regional Trade Agreements (RTAs) as playing a potentially significant role in the implementation of the Paris Agreement and the UN Sustainable Development Goals 13 (SDG 13) on Climate Action. Nevertheless, the competing evidence suggests this cannot be left to simply “happen”. Integrating climate change goals in trade policies should be prioritized. Currently, international climate change and trade policy discussions largely do not take place in the same fora. Climate policy makers meet at the UN Climate Change Conference and trade policy makers at the WTO which results in silo dynamics. In order to address this disconnect between climate and trade policy, countries and regional economic communities can first start by acting on the synergies and creating concrete plans for how climate and trade can support each other.
Against this backdrop, incorporating green provisions in the AfCFTA might also be crucial for generating green industrial development which will be key for Africa’s future competitive advantage in global markets that increasingly demand more climate friendly standards of industries. The AfCFTA entered into force in May 2019 and the official start of trading under the Agreement was 1st January 2021 . Once realized, the Agreement is expected to connect 1.3 billion people across 55 African Union member States with a combined gross domestic product (GDP) valued at US$3.4 trillion. It is expected that the AfCFTA will progressively eliminate 90 percent of tariffs as well as the red tape that limits trade efficiency. As a result, ECA’s latest modeling suggests that, in 2045, intra-African trade has the potential to be around 40 percent higher following AfCFTA implementation than under a situation without AfCFTA in place . The AfCFTA negotiations have been scheduled in phases. The negotiated issues are constituted into Protocols which are to guide AfCFTA implementation. Phase I negotiations are currently in the final stages and covers the Protocols on trade in goods, trade in services and the Settlement of disputes. Phases II Protocols on IPR, Investment, Competition Policy and the Phase III E-commerce Protocol are yet to be negotiated, which offers a window of opportunity to incorporate environmental considerations more strongly.
Environmental provisions in preferential trade agreements are growing both in terms of their number and variety. Some of the more recent RTAs are more supportive of climate goals compared to the more traditional agreements however research argue that most agreements largely fail to support the opportunities of greening trade policies. ICC suggest seven opportunities for supporting climate goals through contemporary trade agreements, i.e. 1) removal of tariff barriers on environmental goods and services, 2) removal of non-tariff barriers on environmental goods and services, 3) explicit limits on fossil fuel subsidies, 4) carbon border adjustments mechanisms, 5) green procurement, 6) approval on non-discriminatory renewable energy subsidies and 7) international cooperation on climate change goals.
The Protocol on Trade in Services is part of phase I of the AfCFTA and is at the time of writing in the final phases of negotiations. The Protocol on Trade in Services sets out principles for enhanced continental market access and services sector liberalization and member states are currently negotiating the schedules of specific commitments under five priority sectors: 1) business services, 2) communication services, 3) financial services, 4) tourism and 5) transport.
This research paper will be a part of a larger research work stream on green transition considerations in AfCFTA Phase II and III issues as well as trade in services. This research stream is led by UNECA in partnership with UNCTAD who will be providing oversight of the research papers produced and packaging of the research.
Objectives of the Assignment:
1. Mapping of the current trade in services treaties in Africa and other regions and identify potential synergies which support the green transition;
2. Analyzing and understanding the opportunities and challenges of greening the AfCFTA protocol on trade in services;
3. Assessing growth opportunities and barriers in greening the services industries in and beyond the 5 priority AfCFTA services sectors.
4. Reviewing best practices of services liberalization agreements with policies on promoting the green transition in other regions and recommend other areas that could be considered as priorities for AfCFTA services liberalization.
5. Preparing evidence-based policy recommendations on how best to incorporate green considerations into the negotiation and implementation of AfCFTA Protocol on trade in services.
Duties and responsibilities:
Working under overall guidance from ATPC Coordinator and the direct supervision of the project manager. The consultant is expected to perform the following specific tasks:
- Conduct a desk review of literature and data on implications of greening trade in services policies in preferential free trade areas in Africa as well as beyond including developed and emerging economies
- Carry out targeted stakeholder interviews both with policy makers of the AfCTFA, trade ministries of AfCFTA members and experts in environmental provisions on investment
- Prepare the draft research paper with oversight from ECA
- Conduct internal review process led by ECA’s RITD and selected stakeholders;
- Finalize the research papers taking into account the feedback and suggestions provided.
Academic Qualifications: Master’s degree in Economics, International Trade, International Relations, International Law and/or related areas is required
Experience: Have a minimum of seven (7) years of professional experience. Proven record in analyzing the impact of trade agreements in relevant policy areas on services is required. Understanding of Africa's regional integration agenda, especially the AfCFTA, is desirable. Knowledge of environmental implications in trade and development is desirable
Language: English and French are the working languages of the United Nations Secretariat. For this post, fluency in English or French is required
THE UNITED NATIONS DOES NOT CHARGE A FEE AT ANY STAGE OF THE RECRUITMENT PROCESS (APPLICATION, INTERVIEW MEETING, PROCESSING, OR TRAINING). THE UNITED NATIONS DOES NOT CONCERN ITSELF WITH INFORMATION ON APPLICANTS’ BANK ACCOUNTS.