Carbon Labelling and Low-income Country Exports: A Review of the Development Issues

Abstract

This article discusses the carbon accounting and carbon-labelling schemes being developed to address growing concerns over climate change. Its particular concern is their impact on small stakeholders, especially lowincome countries. The popular belief that trade is by definition problematic is not true; carbon efficiencies elsewhere in the supply chain may more than offset emissions from transportation. Indeed, low-income countries may offer important opportunities for carbon emission reductions because of their favourable climatic conditions and use of low energy-intensive production techniques. However, their effective inclusion in labelling schemes will require innovative solutions to provide low-cost data collection and certification.

A better carbon footprint label

“…The implementation of a reliable carbon footprint-labeling program involves measuring and verifying the carbon emissions of a product throughout its lifecycle (Cohen and Vandenbergh, 2012). In principle, by means of Life Cycle Analysis (LCA), the carbon emissions of a product from the production of inputs to its final consumption and the disposal of waste are added up (Brenton et al, 2009). This procedure is obviously costly and it demands the conscientious cooperation of many companies and organizations.…”

Climate and trade policies: from mutual destruction to mutual support

“…As a result, the huge risks of misinformation on carbon footprint are reduced (Brenton et al, 2009;Jensen, 2009;Moore, 2010), but they are not completely eliminated. As a result, the huge risks of misinformation on carbon footprint are reduced (Brenton et al, 2009;Jensen, 2009;Moore, 2010), but they are not completely eliminated.…”

Spillover Effects of Carbon Footprint Labelling on Less Developed Countries: The Example of the East Asia Summit Region

“…There are few discussions in the literature of the impact of CFP labelling on developing countries. Some papers discuss the impact of CFP labelling in developed countries on the exports of developing countries generally (Brenton et al, 2009;Edwards-Jones et al, 2009). Issues highlighted are transportation emissions, size bias, data and cost.…”

“…In economics, spillover effects are defined as the externalities of activities or processes upon those who are not directly involved in them. These spillover effects are often generated and distributed through supply chains (Blalock and Gertler, 2004;Brenton et al, 2009) and are commonly assumed in the case of technology or productivity gains from Foreign Direct Investment (FDI) or Research and Development (R&D), such as in Kokko et al (2001) and Mancusi (2008). In this article, spillover effects are defined as the impacts of CFP labelling activities in labelling countries upon non-CFP labelling countries, generated through integrated production networks and supply chains.…”

“…In a globalised world where supply chains are growing longer and have spread to a large number of countries, the calculation of products' CFPs is becoming increasingly complicated (Brenton et al, 2009). Few developing countries are subject to mandatory domestic or international GHG emission regulations.…”