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Sustainable development

What is sustainable development?

Sustainable development means meeting the needs of the present whilst ensuring future generations can meet their own needs.

It has three pillars: economic, environmental and social. To achieve sustainable development, policies in these three areas have to work together and support each other.

World leaders agreed on Agenda 2030, a set of 17 Sustainable Development Goals and 169 targets proposed by the United Nations in 2015.

The EU was instrumental in shaping Agenda 2030.  The EU and its member countries are fully committed to implementing the 2030 Agenda and its Sustainable Development Goals into EU policies.

EU trade policy and sustainable development

EU law requires all relevant EU policies, including trade policy, to promote sustainable development. So EU trade policy aims to ensure that economic development goes hand in hand with:

  • social justice
  • respect for human rights
  • high labour standards
  • high environmental standards

The EU works to ensure trade policy helps promote sustainable development through:

  • EU trade agreements
  • Special incentives for developing countries
  • Trade and development policy

The EU promotes sustainable development by addressing specific issues in EU trade policy:

Sustainable development in EU trade agreements

Modern EU trade agreements contain rules on trade and sustainable development. The EU and its trade partners must:

  • follow international labour and environment standards and agreements
  • effectively enforce their environmental and labour laws
  • not to deviate from environmental or labour laws to encourage trade or investment, and thereby preventing a 'race to the bottom'
  • sustainably trade natural resources, such as timber and fish
  • combat illegal trade in threatened and endangered species of fauna and flora
  • encourage trade that supports tackling climate change
  • promote practices such as corporate social responsibility

The EU also uses its trade agreements to:

  • promote sustainable public procurement
  • remove barriers to trade and investment in renewable energy

EU trade agreements with the following countries include rules on trade and sustainable development:

How it works in practice

The EU meets its partners regularly to discuss how they and the EU are implementing trade and sustainable development rules in the trade agreement between them.

Special civil society advisory groups in the EU and partner countries bring together environmental, labour, and business organisations.

The EU and its partner countries consult the advisory groups on how trade and sustainable development rules are being implemented. Examples of EU advisory groups can be found in:

Trade and development tools

The EU's trade and development policy helps the world's least developed countries (LDCs) to get the benefits of trade for inclusive growth and sustainable development.

The EU uses the following trade and development tools to help developing countries:

The EU's General Scheme of Preferences (GSP)

These are the EU's unilateral preferences to developing countries most in need, in sectors where they need them most.

GSP+ provides additional preferences to vulnerable countries that ratify and effectively implement international conventions on environment, labour and human rights.

The Everything But Arms scheme provides duty-free and quota-free access to the EU market to all products from all LDCs with the exception of arms and ammunition.

Special trade agreements

The EU has also launched a series of free trade agreements with other developing countries in Asia, Latin America, Europe's Eastern neighbourhood and the Southern Mediterranean.

The EU looks beyond tariffs at a wide range of 'behind-the-border issues' that make trade work for development such as:

  • trade facilitation
  • technical, social and environmental rules
  • services
  • intellectual property rights 
  • public procurement

The EU promotes foreign direct investment though favourable local conditions, including through relevant provisions in free trade agreements.

Aid for trade

The EU encourages developing countries, particularly LDCs, to add trade into their development strategies.

Countries should also prioritise their trade needs when cooperating with the EU in order to maintain a steady flow of EU Aid for Trade, including trade-related assistance.

Help for exporters

The EU supports small traders in developing countries access the EU market via:

The EU's trade and development policy also emphasises the importance of developing countries' good governance and ownership of their own development strategies.

Environmental protection

Through its trade policy the EU supports the implementation of international environmental rules, set mainly in multilateral environmental agreements.

These include the:

  • Convention on International Trade in Endangered Species of Wild Fauna and Flora
  • Framework Convention on Climate Change
  • 2015 Paris Agreement
  • Kyoto Protocol on Climate Change
  • Montreal Protocol on ozone layer protection
  • The Convention on Biological Diversity
  • Stockholm Convention on persistent organic pollutants
  • Rotterdam Convention on international trade in hazardous chemicals and pesticides
  • Basel Convention on hazardous waste movement and disposal

Trade policy can also help combat climate change and the transition to a low-carbon economy by:

  • encouraging innovation
  • encouraging investment in low-carbon production
  • making environmental goods and services more affordable

Within the World Trade Organization the EU is working with 16 trading partners to conclude an Environmental Goods Agreement. The agreement will remove tariffs on environmental technologies, including goods crucial for mitigating climate change.

Bilateral trade agreements

The EU uses its trade agreements to contribute to climate action by:

  • reaffirming the commitment to implement international climate conventions
  • early opening of trade in environmental goods, including those important for mitigating climate change
  • promoting trade and investment in environmental goods and services
  • removing non-tariff barriers to trade and investment in renewable energy generation

GSP+

Under the EU's Generalised Scheme of Preferences+ developing countries can gain additional access to the EU market by ratifying and putting into practice 27 international conventions, including most of the multilateral environmental agreements listed above.

FLEG

The EU has also entered into bilateral agreements with a number of countries so that only legally-harvested timber will be exported to the EU. These are called Forest Law Enforcement Governance (FLEG) and Trade Voluntary Partnership Agreements.

Fishing

The EU also acts to prevent imports of fish from illegal, unreported and unregulated fishing, as well as trade in such products within the EU market.

Waste

The EU controls trade in hazardous and non-hazardous waste to ensure that waste is managed in an environmentally-sound way and to prevent and minimise negative impacts on human health.

Environment

The EU works with the United Nations Environmental Programme on initiatives promoting trade and environment.

Studies

The EU also carefully examines the potential impact of trade agreements on climate change through Sustainability Impact Assessments.

Shipping

Increased international trade can increase greenhouse gases emissions from transport, in particular shipping and air transport. The EU is working with the International Maritime Organization and International Civil Aviation Organization to address this issue.

Human rights

The EU's trade policy, alongside its foreign policy and development cooperation, supports respect for human rights in non-EU countries.

The EU examines the effects of trade agreements on human rights in both the EU and its trade partners.  It does so through impact assessments before and during negotiations, and evaluations of trade agreements once they are in operation

The EU's standard Generalised Scheme of Preferences and Everything but Arms scheme allow exporters from developing countries to pay lower customs duties.  If there are serious and systematic violations of human rights the EU can withdraw this benefit until the situation improves sufficiently.

GSP+

Under the Generalised Scheme of Preferences+, developing countries can gain additional EU market access by ratifying and putting into practice 27 international conventions, including international conventions on human and labour rights.  If these conventions are not respected, the EU can temporarily withdraw the additional access.

EU Trade Agreements

Modern EU trade agreements oblige the EU and its partners to respect and implement the International Labour Organization's fundamental conventions on:

  • allowing freedom of association and the right to collective bargaining
  • getting rid of all forms of forced or compulsory labour
  • abolishing child labour
  • ending discrimination in the workplace

Export Controls

The EU supports efforts to abolish the death penalty and ban torture worldwide. This includes strict monitoring and control of EU exports of goods that can be used to carry out torture or death sentences.

The EU is modernising its policy on export controls of 'dual use' goods that can be used for both civilian and military applications. One of the objectives is to prevent the misuse of digital surveillance and intrusion systems that can lead to human rights violations.

Info sources:

Labour rights

The EU uses increased trade opportunities to promote improved labour standards while preventing a 'race to the bottom'.  

In recent trade agreements the EU requires its trading partners to respect and implement the International Labour Organization's fundamental conventions on:

  • freedom of association and the right to collective bargaining (e.g. forming trade unions)
  • getting rid of all forms of forced or compulsory labour
  • abolishing child labour
  • ending discrimination in the workplace

Developing countries using the EU's Generalised Scheme of Preferences+ must also put these four fundamental conventions into practice, among others.  

Working with the ILO

The EU works with the International Labour Organization to monitor and improve labour conditions in developing countries.

One example is the Bangladesh Sustainability Compact launched in 2013. The Compact aims to create a legal framework for labour rights, health and safety standards in clothing factories in Bangladesh and to ensure they are applied. It was a response to the 2013 Rana Plaza tragedy in which over 1,100 people died when a garment factory collapsed.

Since the compact took effect:

  • 235 new inspectors have been recruited to ensure safety conditions in industrial buildings
  • Nearly 350 trade unions have been created and 220 Workers Welfare Associations registered with the rights to collective bargaining.

Another example is the Initiative to Promote Fundamental Labour Rights and Practices in Myanmar in 2015. The initiative also includes the government of Myanmar, the US, Denmark, Japan and the International Labour Organization. It aims to:

  • help promote fundamental rights for workers in Myanmar
  • create opportunities for businesses in Myanmar
  • help transform Myanmar into an attractive trading and investment partner

More information:

Responsible businesses

Nowadays companies increasingly design and make their products in several stages, often in various countries. Raw materials and components are traded from one country to another, assembled and finally exported to the country where they reach the consumer. This is known as global value or supply chains.

Production in the EU depends on imports from other countries of:

  • energy and raw materials
  • parts and components
  • capital goods, such as machinery

EU trade policy aims to help ensure that each stage is carried out responsibly so that it respects workers and the environment.

Corporate social responsibility

Corporate social responsibility – sometimes called 'responsible business conduct' – refers to companies' efforts to integrate social, environmental and ethical aspects into their decision-making and business operations.

The International Labour Organization, the Organisation for Economic Co-operation and Development and the United Nations have developed international guidelines and principles on:

  • human rights
  • working conditions
  • the environment
  • anti-corruption

The EU also works with its trading partners to promote responsible business conduct (also known as corporate social responsibility) among their business, including though specific projects and activities.

Conflict Minerals

EU law will soon require exporters, importers and producers to ensure that minerals imported into Europe do not contribute to financing of armed groups. More information on the conflict mineral regulation.

Fair and Ethical Trade

Voluntary labelling can help consumer have more information on the sustainability of products they buy. Transparent schemes can help promote more sustainable trade.

To promote voluntary labelling schemes, the EU is launching an "EU City for Fair and Ethical Trade" award.  It will involve EU cities and municipalities, civil society groups, the European Parliament and authorities in EU countries. The EU expects to grant its first award in 2018.