Report on Recent International Trade Frameworks and Alignment with Sustainable Development Goals

Introduction: Fostering Global Partnerships for Sustainable Development

Recent weeks have seen the establishment of significant trade frameworks between the United States and key partners, including the European Union, Japan, and Indonesia. These agreements are poised to reshape global agricultural trade flows and carry substantial implications for the achievement of the United Nations Sustainable Development Goals (SDGs), particularly those concerning economic growth, food security, and international partnerships.

United States-Indonesia Framework: Enhancing Food Security and Fair Trade

Key Provisions for Economic Growth and Zero Hunger (SDG 8 & SDG 2)

The framework established with Indonesia marks a critical advancement in bilateral trade relations, directly contributing to economic stability and food security. The core components of the agreement include:

• A commitment from Indonesia to eliminate 99% of tariff barriers on all U.S. agricultural products, facilitating greater market access.
• A confirmed purchase agreement for $4.5 billion worth of U.S. agricultural goods, including vital commodities like soybeans and soybean meal. This directly supports SDG 2 (Zero Hunger) by ensuring a stable supply of food products and SDG 8 (Decent Work and Economic Growth) by stimulating the agricultural sector.

Addressing Non-Tariff Barriers to Promote Strong Institutions (SDG 16 & SDG 17)

A significant aspect of the framework is its focus on dismantling non-tariff barriers, which aligns with SDG 17 (Partnerships for the Goals) by creating a more transparent and equitable trading system. Indonesia has committed to the following actions:

1. Exempting U.S. food and agricultural products from all of Indonesia’s import licensing regimes.
2. Ensuring transparency and fairness with respect to geographical indications for products such as meats and cheeses.
3. Providing permanent Fresh Food of Plant Origin (FFPO) designation for all applicable U.S. plant products.
4. Recognizing U.S. regulatory oversight, including the listing of all U.S. meat, poultry, and dairy facilities.

United States-Japan Agreement: A Focus on Sustainable Industry and Climate Action

Expanding Agricultural Trade (SDG 2 & SDG 8)

The agreement with Japan provides a substantial boost to U.S. agricultural exports, reinforcing longstanding economic partnerships. Japan has committed to:

• An immediate 75% increase in the import quota for U.S. rice, representing a major market expansion and supporting SDG 2.
• The purchase of $8 billion in U.S. goods, which provides a significant economic stimulus in line with SDG 8.

Integrating Sustainable Innovation and Climate Action (SDG 9, SDG 12, & SDG 13)

Notably, the purchase agreement extends beyond traditional commodities to include products that support sustainable development and climate goals. The inclusion of bioethanol and sustainable aviation fuel (SAF) aligns directly with:

• SDG 9 (Industry, Innovation, and Infrastructure): Promoting the development and use of sustainable and innovative fuel technologies.
• SDG 12 (Responsible Consumption and Production): Encouraging the adoption of sustainable products and production patterns.
• SDG 13 (Climate Action): Supporting Japan’s policies to increase the use of renewable fuels to combat climate change.

United States-European Union Framework: A Step Towards Enhanced Partnership

Potential for Tariff Reduction and Economic Cooperation (SDG 8 & SDG 17)

While details remain limited, a framework deal has been reached between the EU and the U.S. that signals progress in strengthening the world’s largest economic partnership, a key objective of SDG 17. Reports indicate a potential for “zero-for-zero” tariffs on certain agricultural products. Such a move would represent a meaningful step in opening one of the world’s most restrictive agricultural markets, thereby fostering economic growth (SDG 8) for producers. The final tariff levels for various goods are still under negotiation, and the full value of the agreement for increasing U.S. agricultural exports remains to be determined.

SDGs Addressed in the Article

• SDG 2: Zero Hunger

  The article extensively discusses international trade agreements focused on agricultural products such as rice, corn, soybeans, and barley. These agreements aim to improve market access and ensure a stable supply of food products between nations, which is directly related to ensuring food security and promoting sustainable agriculture.

• SDG 7: Affordable and Clean Energy

  The trade framework with Japan includes a commitment to purchase bioethanol and sustainable aviation fuel (SAF). This directly supports the goal of increasing the share of renewable energy in the global energy mix.

• SDG 8: Decent Work and Economic Growth

  The trade deals, valued in billions of dollars, are designed to boost U.S. agricultural exports. This stimulates economic activity and growth in the agricultural sector, supporting jobs and economic prosperity. The article highlights the economic value of these agreements, such as the “$8 billion in U.S. goods” for Japan and “$4.5 billion” for Indonesia.

• SDG 17: Partnerships for the Goals

  The entire article is centered on the formation of bilateral trade frameworks and agreements between the United States, the European Union, Indonesia, and Japan. These partnerships are a clear example of global cooperation to facilitate trade and achieve mutual economic benefits, which is the core of SDG 17.

Specific SDG Targets Identified

• Target 2.b: Correct and prevent trade restrictions and distortions in world agricultural markets.

  This target is addressed through the efforts to eliminate and lower tariffs and non-tariff barriers. The article mentions Indonesia’s agreement to “eliminate 99% of tariff barriers,” the EU and U.S. aiming for “zero-for-zero tariffs on some agricultural products,” and Indonesia’s commitment to address non-tariff barriers like “import licensing regimes.”

• Target 7.2: By 2030, increase substantially the share of renewable energy in the global energy mix.

  This target is relevant due to the agreement with Japan, which “establishes Japan will purchase $8 billion in U.S. goods, including… bioethanol and sustainable aviation fuel.” This directly contributes to increasing the use and trade of renewable fuels.

• Target 17.10: Promote a universal, rules-based, open, non-discriminatory and equitable multilateral trading system.

  The article describes bilateral agreements that work towards a more open trading system by reducing trade barriers. The frameworks with Indonesia, Japan, and the EU aim to lower tariffs and simplify trade regulations, aligning with the principles of an open and rules-based system. For example, the deal with Indonesia includes recognizing “U.S. regulatory oversight” and ensuring “transparency and fairness.”

Indicators for Measuring Progress

• Indicators for Target 2.b (Agricultural Trade Restrictions):

  The article provides several quantifiable indicators to measure the reduction of trade restrictions:

  • Tariff elimination rate: Indonesia’s commitment to “eliminate 99% of tariff barriers for all U.S. and agriculture products.”
  • Specific tariff rates: The high tariff on U.S. rice entering Japan outside the quota system is “341 yen per kilogram,” providing a baseline from which to measure reductions.
  • Removal of non-tariff barriers: Indonesia’s agreement to exempt U.S. products from its “import licensing regimes” and provide “permanent Fresh Food of Plant Origin (FFPO) designation” are specific actions that can be tracked.

• Indicators for Target 7.2 (Renewable Energy Share):

  Progress can be measured by tracking the trade in renewable fuels mentioned in the article:

  • Commitment to purchase renewable fuels: Japan’s agreement to purchase “bioethanol and sustainable aviation fuel” as part of its $8 billion commitment is a direct indicator.

• Indicators for Target 17.10 (Open Trading System):

  The article implies several indicators related to the volume and value of trade resulting from these partnerships:

  • Value of trade commitments: The specific monetary values of the agreements, such as Indonesia’s commitment to purchase “$4.5 billion worth of U.S. agricultural products” and Japan’s to purchase “$8 billion in U.S. goods.”
  • Increase in import quotas: Japan’s plan to “immediately increase imports of U.S. rice by 75%.”
  • Volume of trade: Historical data is provided as a baseline, such as Japan importing an “annual average of 326,828 MT of U.S. rice” and a total of “14 million metric tons in corn-equivalent exports” in the 2023-24 marketing year. Future volumes can be measured against this.

Summary of SDGs, Targets, and Indicators

Source: grainjournal.com