Environmental tariffs appear to be a politically necessary part of
the climate change policies that are emerging in many countries. The
appeal of level playing field arguments is seductive and difficult
to dispute. Environmental policy makers, however, may be naïve,
because they fail to account for the potential of trade policy mechanisms
and institutions to be captured by traditional vested interests seeking
economic protection. The exact structures and institutional frameworks
for environmental tariffs are often left vague by environmental policy
makers, making them easy targets for protectionists. Environmental tariffs
appear to be particularly vulnerable to capture given the complexity
of production and the embryonic stage of the science of measuring carbon
intensity. The article outlines the threats to the international trading
system posed by environmental tariffs and suggests cooperation between
those responsible for developing environmental policy and those responsible
for developing trade policy.
Keywords: capture, environmental tariffs, level playing field, protectionism,
WTO
