24 Jul 2020 09:15

Russia believes carbon tax will contravene WTO rules - minister

MOSCOW. July 24 (Interfax) - Russia believes that the introduction of a carbon tax being discussed by a number of countries would contravene the rules of the World Trade Organization (WTO), Economic Development Minister Maxim Reshetnikov told reporters after a video conference with BRICS trade ministers on Thursday.

The European Union has announced plans to introduce additional levies on the products of foreign manufacturers in relation to the CO2 emissions generated by production.

Reshetnikov said Russia "is extremely concerned by attempts to use the climate agenda to create new barriers."

"We see a danger in this, including in the initiative to create a carbon adjustment mechanism that could essentially turn into new duties. We also discussed this matter in detail with our colleagues, we put it on the agenda," Reshetnikov said, commenting on the subjects raised at the BRICS ministers' meeting.

"It's very important to us that all measures that are adopted in furthering the environmental agenda strictly comply with WTO rules, because the mechanisms that are now being proposed by some of our colleagues, in our view, contravene WTO rules and we have communicated this position to our trade partners," Reshetnikov said.

He said the subject of WTO reforms triggered the most heated discussions at the meeting.

"Unfortunately, as you know, there are currently a number of problems at the WTO. Foremost, this is the issue of a nonworking appeals body. Accordingly, the mechanism for making final rulings on trade disputes is backed up. For many countries, this is a big problem and this is now the main focus of discussion, and many countries fear that now the situation that has taken shape with the pandemic will be used to ramp up protectionism, to close trade," Reshetnikov said.

The Russian government is now discussing the possibility of entering into temporary agreements with a number of countries to resolve disputes within the context of the WTO, he said.

"I hope that we will soon work out this position, because in this case we have interests in terms of appeal. We need some sort of mechanism," Reshetnikov said.

He also said the ministers discussed the new five-year strategy for cooperation on economic issues among the BRICS countries to 2025.

"We identified three priorities for ourselves: trade and investment, digital economy and sustainable growth - the climate agenda, issues of energy efficiency and so on," Reshetnikov said.

The new strategy will be prepared and presented for approval to BRICS leaders at a meeting planned for the fall.