Agriculture, trade, and climate change adaptation

Wednesday, May 22nd, 2019

Agricultural production, which is among the most climate-dependent economic activities, is likely to be the economic sector most vulnerable to climate change. Climate change is a global phenomenon with specific impacts and implications for different countries. The extent to which agricultural trade liberalization (removing or reducing barriers and restrictions) can be an adaptation strategy in the face of climate change remains an open discussion.

Professor Wally Tyner, Agricultural Economics, and colleagues from Sweden, Spain and Turkey analyzed the potential impacts of climate change at the country level, and evaluated how tariff elimination could serve as an adaptation strategy. The study focused on Turkey and Morocco—both countries face similar climate change impacts to their agricultural sector, are open to international markets and have significant trade in agricultural commodities. However, they differ in terms of the pace and structure of economic development, which directly impacts their respective competitiveness.

The study found that in a scenario where all tariffs are eliminated, for all regions and all commodities, the welfare loss associated with climate change impacts to agriculture would be offset, globally. Total elimination of tariffs is not likely a realistic scenario, so the analysis focused on a series of trade liberalization schemes at regional and sector levels. The researchers find that the scope of the tariff elimination at these levels does matter in determining how successful trade liberalization will be in mitigating the losses associated with climate change. The more trade is liberalized, the higher the global welfare gains are, however, in all the various scenarios analyzed, the net welfare gains are not large enough to offset the loss from climate change impacts on agricultural productivity globally. For Morocco, agricultural trade liberalization, on average, induces additional welfare losses, whereas for Turkey, trade liberalization results in net welfare gains under all scenarios. The research team identifies several important factors that account for these differences, and outlines several areas for continued research, including better understanding the linkages of non-tariff barriers to trade. 

Ouraich, I., H. Dudu, W. E. Tyner, and E. H. Cakmak (2018). Agriculture, trade, and climate change adaptation: a global CGE analysis for Morocco and Turkey. The journal of North African Studies:

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