Center for American Progress

RELEASE: How a Global Arrangement on Sustainable Steel and Aluminum Can Usher in a New Era of Climate-Friendly, Worker-Centered Trade
Press Release

RELEASE: How a Global Arrangement on Sustainable Steel and Aluminum Can Usher in a New Era of Climate-Friendly, Worker-Centered Trade

Washington, D.C. — The Global Arrangement on Sustainable Steel and Aluminum (GASSA) is one of the most ambitious trade initiatives pursued by the Biden administration and offers a template to move beyond the traditional neoliberal approach to free trade. But there has been little exploration of how GASSA, or an expanded GASSA-like arrangement that includes more trading partners, would actually work—until now. 

A new report from the Center for American Progress examines how new trade rules could afford preferential market access for low-carbon steel and aluminum while creating a common approach to confront nonmarket overcapacity. Doing so would support the economic and national security of both the United States and its partners as well as the global effort to address climate change. 

“The Biden administration has moved the United States from a climate laggard to a climate leader,” said Ryan Mulholland, senior fellow for International Economic Policy at CAP and co-author of the report. “An important next step is ensuring that global trade rules reflect the urgent need to decarbonize heavy industry and address overcapacity from China, which itself is a source of significant emissions. GASSA can achieve both objectives, delivering a win for workers and the environment.” 

The report makes several recommendations to ensure that GASSA achieves maximum impact on behalf of workers and the climate. These include: 

  • Preconditions that members of the arrangement should commit to before joining, including respect for high-standard labor rights, a coordinated strategy to addressing overcapacity, and a commitment to broad industrial decarbonization
  • A tariff structure that favors low-carbon steel and aluminum imported from like-minded partners and discourages dirty exports from nonmarket economies such as China 
  • The use of benchmarks to assess what counts as “lower carbon” that grows more ambitious over time 
  • Reforms to the U.S. customer system so that U.S. officials can distinguish between low- and high-carbon goods at the border 

“The neoliberal model of globalization, in which lowering trade barriers takes precedence over environmental and social concerns, has proved inadequate in addressing climate change, inequality, and the rise of nonmarket economies,” said Trevor Sutton, senior fellow for Energy and Environment at CAP and co-author of the report. “Countries will need to think creatively to develop new trade rules and structures that make sense for the 21st century. GASSA presents an important step in this direction.”

Read the report: “Designing a New Paradigm in Global Trade” by Ryan Mulholland, Trevor Sutton, and Timothy Meyer 

For more information or to speak with an expert, please contact Sarah Nadeau at [email protected]. 

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