PM says trade barriers likely for countries that ignore warming

By Greg Ansley

MELBOURNE - Countries that refused to confront climate change and environmental sustainability could face trade barriers on global markets, Prime Minister Helen Clark told business leaders in Melbourne yesterday.

Speaking in a country that has refused to ratify the Kyoto protocols on climate change and in which the environment is emerging as a critical issue in this year's federal election, she warned that governments could not afford to ignore the need for serious measures.

Early notice of potential trade action has emerged with pressure to penalise New Zealand food and wine exports for the energy required to transport produce to Northern Hemisphere markets.

"I do believe that those who do not take sustainability seriously are likely to face consumer resistance and even trade barriers in the future," Helen Clark told a Transtasman Business Circle lunch.

"We need to be able to confront credibly the challenge of campaigns like that around 'food miles', with its false and simplistic assumption that distance of itself implies unsustainability."

She also warned that environmental sustainability was an economic imperative of the 21st century: "There will be no prosperity without it."

Her audience included executives from some of Australia's biggest corporations, now facing a growing political debate about climate change and sustainability that Prime Minister John Howard has warned will increase energy and other costs.

Canberra has declined to ratify the Kyoto protocols because of its heavy dependence on coal-fired energy and the potential impact that present targets for emissions of greenhouse gases could have on its economy, although Mr Howard is now looking at a carbon trading scheme.

He has refused to set an emissions target until after the election.

The Labor Opposition has said that if it won office it would ratify Kyoto and reduce greenhouse emissions by 60 per cent by 2050.

Although not entering the Australian debate, Helen Clark said New Zealand had realised that no one could sit out those issues and that "everybody has to get on board".

"If you've ratified Kyoto, as we have, you don't have a choice," she said.

If countries did not try to make a difference they risked being branded in key markets as dirty and non-caring.

"Different countries will take different paths to a more sustainable economy because of different stages of development and of access to different local resources," Helen Clark said.

"Naturally, Australia, with abundant coal reserves, will place more emphasis on the development of clean coal technologies than New Zealand, as hydro and geothermal power generation are more readily available options for us."

She said that sustainability was becoming part of the kiwi ethos and was being put into practice by the private sector in such initiatives as the Stock Exchange's proposed carbon trading platform, as well as the CarboNZero programme.

Commercial benefits were emerging through participation in a credible programme to achieve carbon neutrality, illustrated by increased demand for New Zealand Wine Company products.

And facing potential trade problems such as the "wine miles" debate, Helen Clark said New Zealand and Australia had a common interest in working to steer the debate into a more rational direction.

"We must work together to share ideas on tackling global warming," she said. There were opportunities to build partnerships.

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