Debt Crisis Threatens Global Warming Fight as Kyoto Fades

Monday, 05 Dec 2011 07:47 AM

 

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Global warming concerns are being pushed down the political agenda by the European debt crisis and U.S. economic slump, reducing the chance for an accord limiting climate change this week.

“The threat of worsening economic conditions is the ghostly figure at the window for everybody,” Edward Cameron of Washington-based World Resources Institute said in an interview as delegates gathered for United Nations climate talks in Durban, South Africa.

Envoys from 194 nations have scaled back ambitions for this year’s meeting, which concludes Dec. 9. European Union leaders are set to meet in Brussels that same day to discuss a $270 billion bailout for indebted nations. President Barack Obama meets with Canadian Prime Minister Stephen Harper this week to discuss “global issues,” according to the White House.

“Europe is at a financial crossroads and will have a very cautious approach when it comes to any new commitments in Durban,” said Joanna Mackowiak-Pandera, deputy environment minister of Poland, which holds the EU rotating presidency until the end of this year.

Scientists have increased the urgency of their warnings as record levels of heat-trapping gases in the atmosphere last year accelerated melting of polar ice caps and raised sea levels. Developing nations most exposed to climate change are alarmed rich nations are distracted just as greenhouse-gas limits in the Kyoto Protocol enter their final year.

‘Excuse’

“The credit crisis in Europe shouldn’t be used as an excuse for reneging on contributions to climate finance,” Dessima Williams, Grenada’s ambassador to the UN who speaks on behalf of the 42-member Alliance of Small Island States, said in an interview. “Climate change and the financial crisis were created in the industrialized world.”

Talks in Durban are stuck on the issue of how to extend Kyoto, which was negotiated in 1997 and remains the only international treaty setting out how to curb fossil fuel emissions blamed for global warming.

Kyoto’s rules helped spur carbon trading and created the Clean Development Mechanism, which was responsible for generating $26.5 billion of credits and secondary trading of $68.2 billion, accounting for 18 percent of the carbon market since 2005, according to data from the World Bank. Carbon prices have tumbled in recent weeks partly because of concern the Kyoto limits on emissions won’t be extended.

‘Unwillingness’

“The most direct effect of the crisis is the increased unwillingness of finance ministers to put their hands in their pockets,” Henry Derwent, president of the International Emissions Trading Association, said in an interview. “And another effect of a downtown in the economy is that people don’t want permits to emit.”

Developing nations led by China, India and Brazil say another round of commitments under Kyoto are essential to keep the climate talks on track. China and India had no targets under that treaty and since have become two of the world’s three biggest polluters. Japan, Canada and Russia have ruled out extending Kyoto. The U.S. never ratified the pact.

The European Union, which has done the most to limit carbon-dioxide emissions since Kyoto came into force, has said it won’t extend the pact unless ministers sign up to a “road map” setting a date for all nations including big developing ones to take on mandatory targets. That demand was made as Italy, Greece and Spain introduced austerity programs to curb government debt.

‘Concerned’

“We are very, very concerned,” Edna Molewa, South Africa’s lead negotiator, said in an interview. “We don’t underestimate the fact that the world is in a recession, and things aren’t not getting easier.”

She warned against putting climate change on the sidelines to deal only with immediate financial problems.

“Crises come and go, but the problem of climate change may actually exacerbate the problem going forward,” she said. “It may lead to a further crisis.”

Cameron said in spite of concerns hanging over the talks, he’s optimistic countries can “find the political will to takes positive steps in Durban that safeguard the climate, catalyze green investment and stimulate the world economy.”

$100 Billion in Aid

The talks hinge on the ability of industrial nations to channel as much as $100 billion a year in aid to developing nations for combating climate change.

Last week, the U.S. and Saudi Arabia raised concerns about the Green Climate Fund envoys are working on in Durban, increasing the risk the measure isn’t finished in time for the conclusion of these talks. The week before that, a special U.S. congressional panel failed to agree on how to slash $1.2 trillion from the federal deficit, triggering automatic spending cuts of the same amount in 2013.

U.S. lead negotiator Todd Stern said he can’t say for sure whether the Obama administration will fulfill its promise to provide $1 billion for forest projects from 2010 through 2012.

“I’m not going to guarantee,” he told reporters at a Nov. 22 briefing in Washington. “We are working very hard to provide the maximum amount that we can.”

Jonathan Pershing, who led the U.S. delegation in Durban last week, declined to comment in public on the impact of the economy on the talks.

Japan’s Contribution

Japan, which as of March had disbursed $9.7 billion of its $15 billion short-term finance pledge, said it’s moving ahead with commitments in the wake of this year’s earthquake, tsunami and subsequent meltdown at the country’s Fukushima nuclear plant.

Economic concerns “effect Japan too, but we have to continue our efforts tackling climate change,” envoy Masahiko Horie said in an interview. “In spite of the great disaster, unprecedented disaster, we are exercising the utmost efforts right now for climate change.”

Lead European negotiator Artur Runge-Metzger said financial fears make it less likely that developed countries will strengthen emissions-reduction targets anytime soon.

“In terms of upping the ambition, it makes the debate harder, particularly in those countries where the financial difficulties are strongest,” he said in an interview. “That’s a debate we will have to have with the backdrop of the current crisis.”

Change in Tone

Venezuelan negotiator Claudia Salerno says there’s a palpable change in tone among the Europeans, who traditionally have been among the most outspoken in calling for stronger international action on climate change.

“They have a different attitude toward the climate process,” she said in an interview. “They are more tense here in Durban. We understand it.”

Even if ministers were able to find a way toward an agreement in Durban, they might not be able to get leaders to sign off on the plan at home, said Alden Meyer, Washington-based director of policy at the Union of Concerned Scientists. EU leaders in Brussels will focus on the debt issue at the same time ministers are wrapping up talks in Durban.

“European leaders are all focused on the crisis,” Meyer said in an interview. “The question is whether leaders have a minute to spare at the meeting about the Euro crisis to talk about the crisis in Durban.”

--With assistance from Ewa Krukowska in Brussels. Editors: Reed Landberg, Alessandro Vitelli

To contact the reporters on this story: Kim Chipman in Washington at kchipman@bloomberg.net; Alex Morales in London at amorales2@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

© Copyright 2014 Bloomberg News. All rights reserved.

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