Ambassador Clare Kelly of New Zealand, coordinator of the FFSR initiative, summarized the progress made on the three key pillars of the initiative’s work in 2025. Noting the strong interest in experience-sharing under the third pillar — “identifying and addressing harmful fossil fuel subsidies” — she encouraged participating members to continue exchanging ideas and to draw lessons from others’ reforms and complementary strategies to address social and developmental challenges.

As part of the dedicated discussion on fossil fuel reforms, the Philippines shared its experiences on energy market and fossil fuel subsidy reform, including in support of the transition to sustainable energy solutions, while aligning with development priorities. The World Bank presented two new databases that enable users to track changes in retail fuel prices and related subsidy policies across countries in a timely manner. These tools are designed to support global efforts to address challenges associated with fuel pricing and subsidies, particularly in the context of volatile market conditions.

In further discussions under the third pillar, co-sponsors examined the trade and environmental impacts of fossil fuel subsidies passed through to emissions-intensive industries. The International Energy Agency (IEA) presented its latest energy investment report, which indicated that fossil fuel subsidy support to industry had remained constant, despite a significant global shift towards increased clean energy investment.

The Organisation for Economic Co-operation and Development (OECD) shared key findings from a recent study on the implications of government support for aluminium smelting and steelmaking. The study concludes that reforming such support offers a cost-effective way to reduce emissions while freeing public resources for more sustainable uses. The WTO Secretariat also presented a 2024 working paper on the trade effects of carbon pricing policies, which contains analysis of the potential impacts of different carbon pricing policies, including removal of fossil fuel subsidies, on comparative advantage in carbon-intensive industries.

Co-sponsors thanked members and stakeholders for the valuable insights shared, which underscored the importance of strengthening fossil fuel subsidy reform through collective efforts. They emphasized the persistent scale and impact of fossil fuel subsidies, even amid increasing investment in clean energy. The empirical evidence presented confirmed that such subsidies distort comparative advantages and global trade, reinforcing the relevance of the FFSR initiative’s focus on subsidy reform. Co-sponsors also proposed ways to improve the understanding and classification of different types of fossil fuel subsidies.

Under the first pillar — “Enhanced transparency” — several co-sponsors, including Colombia, Norway and Switzerland, provided updates on their respective efforts to compile information on fossil fuel subsidies and related reforms as part of their recent or upcoming Trade Policy Reviews. The WTO Secretariat presented data from members’ questions and answers related to fossil fuel subsidies and their reform, based on 18 Trade Policy Reviews conducted in 2024 and 2025. The findings reflect increased transparency on the topic, in part as a result of the non-exhaustive list of sample questions to be asked at TPRs adopted by the FFSR initiative co-sponsors at MC13.

Under the second pillar — “Crisis support measures” — the coordinator highlighted ongoing efforts to compile information on temporary fossil fuel support measures introduced during the 2022–2023 energy crisis, with the aim of developing a practical set of guidelines to help members design any future such measures effectively. Co-sponsors reaffirmed the usefulness of the work on planned guidelines to help ensure that such measures remain targeted, transparent and temporary.

In conclusion, Ambassador Kelly noted that the next FFSR meeting, scheduled for 2 October 2025, will continue to promote experience-sharing and maintain a focus on the three core pillars of the work programme.

The FFSR initiative seeks to achieve the rationalization, phasing-out or elimination of harmful fossil fuel subsidies through the use of existing mechanisms or the development of new pathways to reform. It encourages WTO members to share information and experiences to advance discussions at the WTO. More information about the FFSR initiative is available here.

Share