TWN Info Service on Climate Change (Dec11/03)
23 December 2011
Third World Network 

Dear friends and colleagues,

On 22 December the Foreign Ministry of China announced that the government opposes the European Union's "mandatory and unilateral" legislation on a carbon emissions tax on airlines. At the same time China's "big four" airlines -- Air China, China Eastern Airlines, China Southern Airlines, and Hainan Airlines -- have reached an agreement with the China Air Transport Association to jointly take legal action against the EU.

Below is a translation by TWN of the quotes and some background information from Xinhua news agency.

With best wishes,

Third World Network

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SOURCES:
1.http://news.xinhuanet.com/english/china/2011-12/22/c_131321953.htm
2.http://news.xinhuanet.com/english/china/2011-12/22/c_122469435.htm

China opposes the European Union's "mandatory and unilateral" legislation on a carbon emissions tax on airlines, the Chinese Foreign Ministry said Thursday (22 December). China has made clear its stance on this issue and has expressed its concern to the EU via bilateral channels, said spokesman Liu Weimin at a daily press conference. Many countries oppose the EU's move, and China hopes the EU will act with caution and settle the issue in a positive and pragmatic way through sound consultation with relevant countries, Liu said.

According to the plan, all airlines flying to and from the 27 EU countries will have to pay for 15 percent of the polluting rights accorded to them in 2012, which will rise to 18 percent in the period of 2013-2020.

The European Union Court of Justice on Wednesday (21 December) dismissed arguments from North American air carriers that the EU's ETS (Emissions Trading System) infringes on national sovereignty or violates international aviation treaties, a ruling Chinese airlines are also likely to face if they launch a lawsuit against the scheme.

China's "big four" airlines -- Air China, China Eastern Airlines, China Southern Airlines, and Hainan Airlines -- have reached an agreement with the China Air Transport Association (CATA) to jointly sue the EU in Germany at the end of the month. "We know that the prospect of victory is dim, but we want to show our firm opposition by launching a lawsuit," said Chai Haibo, deputy secretary of CATA.

The unilateral extension of the ETS to non-EU airlines violates the Kyoto Protocol, which stipulates that developed and developing countries have common but differentiated responsibilities in coping with climate change, said Shen Jiru, a senior researcher at the Institute of World Economics and Politics under the Chinese Academy of Social Sciences.

Meanwhile, the EU's decision to charge money for carbon potentially emitted outside of its airspace runs contrary to the customary international legal principle that each State has complete and exclusive sovereignty over the airspace above its territory, Shen said.

"The extension of the ETS to international aviation is the latest example of unfair competition, as the EU can use the money it collects from other countries' airlines to subsidize its own aviation industry or its aircraft manufacturing sector. That will be an obvious breach of the WTO's principle of free trade," he added.

"China must accelerate the development of the aviation biofuel industry. That is the fundamental means for reducing the country's carbon footprint," Shen Jiru noted.

Chinese airlines cannot bear an extra 800-million-yuan burden (about USD 126 million) every year after reporting huge losses during the global financial crisis, said Li Xuerong, a researcher at China Investment Consulting.

"Chinese airlines have been in a period of rapid expansion and are looking to increase their aircraft fleet to meet the growing demand for international travel. Therefore, it will be difficult for them to cut aggregate carbon emissions in the short term," Li Jingyun, a researcher at the Department of Policies, Laws and Regulations under the Ministry of Environmental Protection said.

The EU should levy carbon taxes on airplane manufacturers instead of airlines, because it was the former that failed to produce energy-efficient aircraft, Li said.She suggested Chinese airlines join together to pressure the EU by threatening to reduce purchases of Airbus aircraft.+