Global leaders agree to cut tariffs on environmental goods

Fourteen global trading partners said Friday that they work together to  eliminate tariffs on environmental goods such as solar water heaters, wind turbines and catalytic converters. 

U.S. Trade Representative Michael FromanMichael B.G. FromanUS will investigate aluminum imports as national security hazard Overnight Finance: WH floats Mexican import tax | Exporters move to back GOP tax proposal | Dems rip Trump adviser's Goldman Sachs payout Froman heads to Council on Foreign Relations MORE announced the launch of the new initiative -- which is expected to grow environmentally focused jobs and boost innovation into sustainable technologies -- with a group of World Trade Organization (WTO) members at the World Economic Forum in Davos, Switzerland.

Senate Finance Committee Chairman Max BaucusMax Sieben Baucus2020 Dems pose a big dilemma for Schumer Steady American leadership is key to success with China and Korea Orrin Hatch, ‘a tough old bird,’ got a lot done in the Senate MORE (D-Mont.) said the decision will help fight climate change, provide worldwide environmental benefits and create more jobs. 

"The United States and its APEC partners laid the foundation, and now it is time for WTO Members to join together to advance this important initiative and produce an ambitious outcome.”

The United States is joined by Australia, Canada, China, Costa Rica, the European Union, Hong Kong, Japan, Korea, New Zealand, Norway, Singapore, Switzerland and Chinese Taipei.  

USTR said it will work with Congress along with business and environmental communities to ensure that the negotiations advance U.S. environmental objectives and "support economic growth, green jobs and innovation."

Froman said the increased trade is a key factor in President Obama's Climate Change Action Plan.

"This new effort will build on the United States’ work with Asia-Pacific partners to make renewable and clean energy technologies cheaper and more accessible for everyone," Froman said. 

"This effort among like-minded WTO partners will also help to maintain momentum in Geneva for the kinds of fresh, credible approaches to trade negotiation and results that led to success at Bali last year."

Total global trade in environmental goods amounts to nearly $955 billion annually, and some countries apply tariffs as high as 35 percent.  

The group of WTO members participating in the initiative account for 86 percent of global trade in environmental goods and they have  already started the outreach to other countries encouraging them to join.

At the Asia-Pacific Economic Cooperation (APEC) meeting in 2011 and 2012, the United States led a group of 20 nations to commit to cut tariffs to 5 percent or less on a list of 54 environmental goods including solar water heaters and wind turbines.

USTR said that the new initiative is expected to complement U.S. led efforts to remove barriers to global services trade, including environmental services, such as air pollution monitoring, and solid and hazardous waste treatment, as part of the Trade in Services Agreement (TiSA).