Decarbonizing Global Trade: Pathways to Sustainable Supply Chains and Climate-Resilient Economies

As the global community continues to grapple with the urgent challenge of climate change, the intersection of trade, supply chains, and climate resilience has emerged as a critical area for action. This session aims to bring together experts, policymakers, and industry leaders to explore strategies for reducing carbon emissions in international trade, with a particular focus on the EU’s Carbon Border Adjustment Mechanism (CBAM) and the role of the Trans-Caspian route as a sustainable corridor.

The transition to a green economy is increasingly relevant worldwide, and the growing trade among Central Asian (CA) countries highlights industry as a key driver of growth and competitiveness. Kazakhstan and other CA nations, with their commodity-driven economies, face unique challenges and opportunities in the global shift towards a low-carbon future. As major exporters of raw materials and energy resources, these countries are particularly impacted by international efforts to decarbonize trade and supply chains. This session will explore how commodity-dependent economies can navigate these changes while promoting sustainable economic growth.

The Enhanced Partnership and Cooperation Agreement between the European Union (EU) and Kazakhstan underscores a broad range of collaborative initiatives. Trade relations between Kazakhstan and the EU are dynamically developing, with the trade turnover reaching $41.4 billion in 2023, a 3.5% increase from the previous year. Kazakhstan's exports to the EU include oil, petroleum products, ferroalloys, coal, uranium, wheat, and various other goods.

However, critical aspects of trade and economic cooperation, especially in light of the introduction of CBAM under the European Green Deal, require careful consideration by businesses. This new initiative raises significant questions for producers, particularly those related to the economic impacts of this regulation. While discussions around CBAM often focus on environmental aspects, the economic implications for trade, especially for small and medium-sized exporters, remain underexplored, despite these exporters being key beneficiaries of the regulation.

The event will delve into the implications of CBAM for CA, explore the potential of the Trans-Caspian route as a sustainable trade corridor, and discuss strategies for building climate-resilient supply chains in the region. The session aims to shed light on how global trade policies and practices can evolve to support the transition to a low-carbon economy, ensuring that economic growth is aligned with environmental sustainability.

Objectives

• Discuss the Role of CBAM: To explore the implications of the Carbon Border Adjustment Mechanism for trade, focusing on how it can incentivize decarbonization efforts in exporting countries while ensuring a level playing field for industries in the EU.
• Explore CBAM’s Impact on CA: To assess how the Carbon Border Adjustment Mechanism will affect Kazakhstan and other CA countries, particularly in terms of their exports to the EU, and discuss ways to align regional trade practices with global decarbonization goals.
• Showcase the Trans-Caspian Route: To highlight the potential of the Trans-Caspian route as a green corridor that can facilitate sustainable trade between CA and Europe, reducing the carbon footprint of commodity exports.
• Foster Regional Cooperation: To encourage collaboration among countries along the Trans-Caspian route and beyond in developing and implementing policies that support sustainable trade and climate resilience.
• Support Sustainable Supply Chains in Commodity Economies: To identify strategies for Kazakhstan and other commodity-driven economies to build more sustainable and climate-resilient supply chains, ensuring long-term economic stability while contributing to global climate goals.
• Strengthen Regional Cooperation: To promote collaboration among CA countries and with international partners in developing and implementing policies that support the decarbonization of trade and the transition to sustainable economies.

Expected Results

• Enhanced Understanding: Participants will gain a deeper understanding of the CBAM and its potential to drive global decarbonization efforts, along with insights into the strategic importance of the Trans-Caspian route for sustainable trade.
• Actionable Policy Recommendations: The session will produce actionable recommendations for policymakers and stakeholders to integrate climate considerations into trade policies, with a focus on the role of supply chains in achieving climate goals.
• Strengthened Partnerships: The event will facilitate dialogue and collaboration between governments, international organizations, and private sector stakeholders, fostering partnerships aimed at promoting sustainable trade practices and climate resilience.
• Increased Awareness: Attendees will leave with increased awareness of the importance of decarbonizing global trade and the critical role that sustainable supply chains play in achieving a climate-resilient economy.
• Region-Specific Insights: Participants will gain insights into the specific challenges and opportunities for Kazakhstan and other CA countries in the context of CBAM and global decarbonization efforts, with a focus on commodity-driven economies.
• Enhanced Regional Collaboration: The event will foster stronger ties between CA countries and international stakeholders, paving the way for collaborative efforts in promoting sustainable trade practices and enhancing climate resilience in commodity-dependent economies.
• Increased Regional Awareness: The session will raise awareness among policymakers, industry leaders, and other stakeholders about the importance of decarbonizing trade in CA and the role of sustainable supply chains in supporting economic and environmental goals.