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U.S.Click Customs and to Border edit Protection Master Green Tradetitle Strategy style JUNE 2022 Click to edit Master subtitle style 1 CONTENTS Executive Summary 1 Introduction 2 Green Trade Vision and Guiding Principles 3 Strategic Goals Overview 4 Incentivize Green Trade 5 Strengthen Environmental Enforcement Posture 6 Accelerate Green Innovation 7 Improve Climate Resilience and Resource Efficiency 8 Path Forward 9 CBP Publication No. 1845-0622 EXECUTIVE SUMMARY As the lead law enforcement agency responsible for enforcing trade laws in the federal government, U.S. To focus CBP’s efforts and achieve our Green Trade Vision, this document lays out four Customs and Border Protection strategic goals: (CBP) is responsible for ensuring that cross-border trade complies with • Incentivize Green Trade – provide facilitation benefits and other incentives to promote applicable U.S. laws and promotes environmentally-friendly trade practices and supply chains fair, secure, and safe competition. These efforts contribute to American • Strengthen Environmental Enforcement Posture – enforce against environmental bad economic prosperity, protect public actors to drive meaningful changes in trade practices health and safety, and strengthen global supply chains. • Accelerate Green Innovation – promote and invest in the deployment of innovative, In the international community, there sustainable trade practices by government and private industry is now widespread recognition of the • Improve Climate Resilience and Resource Efficiency – decrease the greenhouse gas challenges that climate change is creating and will continue to create in emissions associated with CBP operations and strengthen the resilience and sustainability the coming years. While of trade infrastructure and assets governments and private industry have taken steps to address climate Executing these strategic goals will enable CBP to do its part to mitigate the threats posed by change, more significant action is climate change, while also promoting innovation, accelerating economic growth, needed, both to slow the effects and supporting the development of more resilient and ethical supply chain practices. already upon us and to prepare for the impacts yet to come. As such, CBP seeks to establish itself as a champion for the green economy and a leader in the fight against climate change by accelerating the global transition to green trade and serving as a responsible steward of our own environmental footprint. 1 INTRODUCTION CBP is charged with facilitating legitimate trade while keeping the American public safe. In executing its trade mission, CBP is responsible for ensuring that cross-border trade complies with U.S. trade laws and promotes fair, secure, and safe competition. These efforts contribute to American economic prosperity, protect public health and safety, and strengthen global supply chains. As we progress further into the 21st century, there is widespread recognition of the challenges that climate change is creating and will continue to create in the coming years. Recent studies have indicated that global supply chains account for as much as 80 percent of the world’s total carbon emissions1. In October 2021, the U.S. Department of Homeland Security (DHS) released its Strategic Framework for Addressing Climate Change2 in response to Section 211 of Executive Order 14008: Tackling the Climate Crisis at Home and Abroad3. CBP’s Green Trade Strategy aligns with the DHS Strategic Framework—particularly the lines of effort entitled “Incorporate Foresight and Climate Science into Strategy, Policy, Programs, and Budgets” and “Invest in a Sustainable and Resilient DHS”—and presents strategic goals tailored to addressing climate change in the context of the trade mission. Climate change poses significant challenges to CBP’s trade mission, but also provides new opportunities for innovation and improvement. This Green Trade Strategy lays out the agency’s vision for seizing these opportunities to grow the economy and accelerate American innovation, while building resilience and addressing climate-related threats to our national and economic security. CBP will continue to incorporate and act on new knowledge, information, and guidance as these become available, rather than prescribe a static list of activities. Examples provided in this document are illustrative starting points based on the important work already being done across the Agency. These examples should not be considered a comprehensive list or the limit of our aspirations. 1 https://www.hsbc.com/insight/topics/seven-steps-to-tackle-a-usd50-trillion-challenge 2 https://www.dhs.gov/news/2021/10/21/dhs-releases-new-strategic-framework-addressing-climate-change 3 https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/27/executive-order-on-tackling-the- climate-crisis-at-home-and-abroad/ 2 GREEN TRADE VISION & GUIDING PRINCIPLES Green Trade Vision Establish CBP as a champion for the green economy and a leader in the fight against climate change by facilitating the global transition to green trade and serving as a responsible steward of our own environmental footprint. Green Trade Guiding Principles These principles serve as the overarching ideals that will guide our strategies and actions related to green trade. Leadership. We will help solidify America’s leadership role in green trade and serve as an example for others. Education. We will strengthen the climate literacy of our trade workforce and stakeholders and use this knowledge to maximize the impact of our efforts. Collaboration. We will work together with domestic and foreign partners to address the wide-reaching impacts of climate change and promote global solutions to a global challenge. Commitment. We understand the importance of addressing climate change and are committed to making a difference. Investment. We will invest our time and resources to promote green trade initiatives, spur on innovation, and build our resilience. 3 5 STRATEGIC GOALS OVERVIEW Four strategic goals will focus CBP’s efforts to address climate change in the context of the trade mission and achieve our Green Trade Vision. Executing against these goals will enable CBP to champion the green economy and accelerate the global transition to green trade both in the U.S. and abroad, while responsibly managing our own environmental footprint. Incentivize Green Trade Provide facilitation benefits and other incentives to promote environmentally-friendly trade practices and supply chains Strengthen Environmental Enforcement Posture Enforce against environmental bad actors to drive meaningful changes in trade practices Accelerate Green Innovation Promote and invest in the deployment of innovative, sustainable trade practices by government and private industry Improve Climate Resilience and Resource Efficiency Decrease the greenhouse gas emissions associated with CBP operations and strengthen the resilience and sustainability of trade infrastructure and assets 4 Incentivize Green Trade Provide facilitation benefits and other incentives to promote environmentally-friendly trade practices and supply chains OPPORTUNITIES TRADE CONTEXT • Develop green trade incentive programs and other facilitation mechanisms: Explore the potential deployment of green trade programs that incentivize the use of sustainable, climate-friendly practices. Engage the Trade incentives and trusted trader Commercial Customs Operations Advisory Committee (COAC) to solicit industry input on incentives that could programs, such as the Customs encourage green trade while avoiding negative impacts on the flow of legitimate cargo. For example, streamlining Trade Partnership Against Terrorism the clearance of cargo, through processes similar to Advanced Qualified Unlading Approval (commonly referred to (CTPAT), have traditionally been as AQUA Lanes) and Unified Cargo Processing, and encouraging the use of eco-friendly modes of transport— utilized by CBP to promote national such as electric vehicles and low-emission vessels—provides tangible facilitation benefits for importers while security and supply chain integrity. As reducing fuel consumption and cutting greenhouse gas emissions. supply chains grow increasingly complex, interconnected, and • Incorporate environmental priorities into existing trade programs: Consider adding environmental criteria international in nature, these types of into existing trusted trader programs, such as CTPAT. Working in partnership with the trade industry to advance trusted trader programs continue to green trade practices presents an opportunity to improve environmental stewardship throughout the supply chain. be an effective method for CBP to • Collaborate with international partners to incentivize green trade, build global capacity, and harmonize incentivize positive change in private approaches: Leverage partnerships with foreign customs agencies, non-governmental organizations (NGOs), industry and could be leveraged to and others to advocate for environmental protections and incentive programs that build global capacity and encourage green trade practices. In harmonize international environmental standards and objectives. For example, the World Customs Organization’s addition, coordination with foreign (WCO) Environment Programme works to promote green customs practices and combat environmental crime. customs agencies to implement similar programs in their countries can further enhance the effectiveness DESIRED OUTCOMES of these incentives by increasing the • Expedited transition to green trade practices overall return on investment for members of the trade that comply. • Tangible financial and environmental benefits for our trade industry partners • Enhanced green standards around the world 5 Strengthen Environmental Enforcement Posture Enforce against environmental bad actors to drive meaningful changes in trade practices TRADE CONTEXT OPPORTUNITIES • Prioritize enforcement of environmental laws and controls in conjunction with partner government agencies: Climate change is truly a Bolster collaborative enforcement efforts against bad actors who seek to evade U.S. environmental laws and regulations. global challenge that This could include working with partner government agencies to apply existing penalties in a more aggressive manner, requires a global solution; as allowed under existing authorities, or exploring other consequence options. Regardless of the delivery mechanisms, even small pockets of we should pursue joint enforcement that is targeted, timely, and drives meaningful change in behavior. counterproductive behavior • Enhance supply chain visibility to illuminate environmental risk factors: Strengthen our enforcement posture by can impede progress in prioritizing the targeting of bad actors and working with partner agencies, as appropriate, to enforce against environmental threats, which harm the environment and can be used to fund criminal enterprises. This could be achieved slowing the warming of the by potentially expanding the collection of supply chain data and intelligence to target polluters and parties involved in planet. As the lead law trading illicit environmental goods, such as ozone depleting substances, illicit timber, and critical minerals. enforcement agency of • U.S. trade laws, CBP can Bolster information sharing with stakeholders to promote coordinated enforcement: Promote interagency collaboration to target both known and unknown bad actors, strengthen its environmental preventing bad actors from infiltrating our supply chains, and promoting similar, enforcement posture and consistent approaches with international partners. Share data, in accordance with use its position as a leader the law, as well as supply chain insights and best practices with international among customs customs agencies and NGOs to coordinate enforcement efforts and build stronger administrations to build the enforcement capabilities worldwide. In addition, sharing, in accordance with the law, capacity of foreign relevant environmental enforcement information with the trade would enable industry to police their own supply chains and serve as force multipliers. customs agencies and promote coordinated • Coordinate with domestic and foreign governments to enforce environmental Encourage the inclusion of environmental enforcement approaches. provisions in trade agreements: requirements and other climate commitments in trade agreements (such as the United States-Mexico-Canada Agreement) so that goals, targets, and obligations are shared fairly across all parties. Holding others accountable to their obligations aligns with the need for a global solution to climate change. DESIRED OUTCOMES • Targeted and timely enforcement against environmental crime • Coordinated enforcement efforts with international partners • Strong environmental provisions in trade agreements, complemented by effective accountability mechanisms 6 Accelerate Green Innovation Promote and invest in the deployment of innovative, sustainable trade practices by government and private industry OPPORTUNITIES • Identify ways that industry can play a role in addressing the climate crisis: TRADE CONTEXT Analyze supply chains and government trade operations to identify ways to limit greenhouse gas emissions and other environmental impacts. Engage with partner Climate change will pose government agencies, international customs agencies, and the trade industry to share challenges to trade. Trade outlook, strategy, knowledge, and best practices concerning green trade. Engage stakeholders, including with the COAC to solicit industry perspectives and ideas. By building a common CBP, partner government understanding, we can help facilitate a coordinated approach across sectors agencies, and private to mitigate the risks posed by climate change. industry, will need to adapt • Promote research pertaining to green trade: Engage the DHS Science & Technology and innovate in order to Centers of Excellence, academia, and other avenues to conduct research on green trade. mitigate negative impacts Utilize the latest research and evidence-based findings to ensure climate change and risks and build climate are appropriately considered to drive decision-making, policy updates, and investment decisions. resiliency. Paperless trade, • Align customs processes with a green future: Reimagine the entry process and other trade fuel-efficient and low- processes to make them resource efficient. Future-proof CBP operations to make them compatible emission transportation, with emerging technologies and environmentally-friendly methods of commerce. Having the agility and streamlined port and flexibility needed to quickly adapt to the latest trade innovations will accelerate implementation operations are just a few of and maximize environmental benefits. the current innovations • Incentivize green innovation by industry: Promote industry innovation to create a market for that could have significant technology, products, and processes that will accelerate the adoption of green trade practices. positive climate impacts. Harness the power of American ingenuity via prize competitions4 and through private industry CBP has the opportunity to events to accelerate new ideas/invention and improve upon existing technologies. Providing a use its prominent position platform for innovation can inspire and incentivize others to pursue similar solutions. in international trade to DESIRED OUTCOMES build capacity and accelerate the adoption of • Environmentally-conscious operations that are informed by cutting-edge research and are able to sustainable practices and accommodate ongoing innovation in green trade green innovation around • Motivated industrial base focused on bringing green technologies and other innovations to market the world. • Coordinated approach by trade stakeholders to addressing the risks posed by climate change 4 https://www.dhs.gov/science-and-technology/prize-competitions 7 Improve Climate Resilience and Resource Efficiency Decrease the greenhouse gas emissions associated with CBP operations and strengthen the resilience and sustainability of trade infrastructure and assets TRADE CONTEXT OPPORTUNITIES Much of our nation’s • Promote resource efficiency through renewable and/or energy efficient infrastructure, including CBP sources and waste management practices to reduce CBP’s carbon footprint: Pursue opportunities at the headquarters level to enhance the energy efficiency of trade infrastructure, was not office buildings, right-size office space, and phase in more efficient equipment, built to withstand the such as multifunction devices, to reduce energy consumption. In the field, impending effects of climate consider energy-efficient updates such as transitioning to an electric vehicle fleet, change, such as extreme which can reduce greenhouse gas emissions while cutting fuel costs. As permitted temperatures, severe by law, explore green destruction techniques, where practical, such as waste-to- weather events, and rising energy incineration, and maximize opportunities for recycling and/or donation of sea levels. Proactive action forfeited merchandise. before these changes impact CBP operations will • Utilize flexible and non-traditional work arrangements to decrease enhance mission readiness workforce environmental impacts: Offer employees flexible work arrangements and provide our workforce where operationally feasible and upgrade audio/visual equipment to promote with the support needed to collaboration in distributed work settings. This would help decrease overhead excel in a changing costs by reducing electricity and water usage and allowing for further consolidation operational environment. of office space. Less commuting time for CBP employees would also reduce the agency’s overall carbon footprint and energy consumption. • Improve the resilience of our workforce and infrastructure against the effects of climate change: Boost mission readiness by upgrading trade infrastructure at the ports of entry to withstand rising sea levels and severe weather events. Prepare our frontline workforce to operate in more extreme environments. DESIRED OUTCOMES • Reduced carbon footprint and energy consumption driven by energy-efficient facilities and assets • High levels of mission readiness and a workforce that is prepared to operate in a changing operational environment 8 PATH FORWARD With the effects of climate change already being felt, it has become clear that timely and meaningful action is needed to mitigate climate risk factors and build resiliency in the face of a changing environment. Governments and private companies around the world have recognized the importance of this situation and are accelerating efforts to decrease emissions, improve resource efficiency, and build readiness for the effects of climate change. CBP is committed to doing our part to fight climate change by incentivizing green trade practices, cracking down on environmental bad actors, accelerating green innovation, and improving the resilience of our infrastructure and people. Environmental considerations will be integrated into our day-to-day operations, allowing us to execute our trade mission at the highest level, while serving as good stewards of the environment. While climate change poses significant threats, we also see opportunities for innovation, economic growth, and more resilient and ethical supply chain practices. This Green Trade Strategy sets out an ambitious vision for the future of CBP’s trade mission, aiming high to match the urgency of climate change by mitigating impacts on the environment and trade. And the opportunities outlined in this document are only a starting point. As new challenges, priorities, and opportunities arise, we will adjust with agility to best position the agency to execute its mission and fight climate change. Moving forward, CBP’s Green Trade Guiding Principles—Leadership, Education, Collaboration, Commitment, and Investment—will continue to guide our strategies and our actions related to green trade. Working together with our government and industry partners, we believe we are well- positioned to make a difference on the path to a cleaner, more sustainable future. 9