Free trade and clean energy go hand in hand

“Clean energy” has become a short term for the broad political debate on how to achieve sustainable economic growth and improve US energy security.

A joint study recently published by the World Trade Organization and the International Renewable Energy Agency examines how policies promoting open trade can support cost reductions, product development and job creation, especially in the photovoltaic technology industry.

The report, titled “Trading into a bright energy future: The argument for open, high quality solar photovoltaic markets,” points out that “Open global trade has been an important factor in the rapid deployment of photovoltaic technologies around the world “.

The report also emphasizes, “Keeping markets open is vital to ensure that all countries can benefit from photovoltaic (PV) technologies,” while “Tariff reduction initiatives should be complemented by efforts to address broader technological, economic, political and regulatory barriers to eliminate that “hinder the use of photovoltaics.”

Indeed, the free, transparent market system – reinforced by more open trade – has resulted in improved capacity for clean energy innovation around the world. The positive connection between economic freedom and a higher level of innovation ensures a better ability to cope with environmental challenges.

As shown by the Heritage Foundation’s annual Index of Economic Freedom since 1995, nations advocating the rule of law, fiscal responsibility, regulatory efficiency, and market openness are paving the way for pragmatic public and private strategies and actions that promote environmental health and the vitality of the Improve the ecosystem.

In simpler terms, freer economies are cleaner, greener economies.

The welcome outcome of this important interaction between market opening and capacity building is a positive cycle of investment, innovation and more dynamic, inclusive economic growth. These economic facts apply to the clean energy technology sector as to any other.

The energy sector also needs freer trade. Indeed, freer trade and the promotion of clean energy technologies can go hand in hand and be mutually supportive. Not so ambiguous, greater freedom of trade is key to “green” growth.

The World Trade Organization, a multinational body that “provides a framework of disciplines to facilitate world trade and serves as a forum for negotiations on further trade openness,” states that:

Openness to trade can support efforts to mitigate and adapt to climate change, for example by promoting the efficient allocation of global resources (including natural resources), increasing the standard of living (and thus the demand for better environmental quality) and improving access to environmental goods Services.

It is good to remember that promoting free trade is an important policy measure to effectively promote a healthy environment. The pragmatic and permanent way to ensure a cleaner and more sustainable environment is through the diffusion and enhancement of free trade, which leads to dynamic, competitive innovation.

Often progressive politicians and activists claim that capitalism is bad for the environment. Capitalism, however, is by no means the problem, but the tried and tested route to real, practical solutions. Free market principles, which have proven to be the key to economic success, can also ensure ecological success.

The global economy needs these principles now more than ever.

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