Global Trends by Martin Khor

For Star, Monday 6 Nov 2006


Climate change is rapidly moving up the global policy agenda as new reports are published almost daily showing how serious the problem is, and that action is needed now.  Last week, a new British report showed that 20% of world income could be wiped out by climate change. But another report shows that the rich countries are not meeting the emission-reduction targets.


Two new reports last week threw new light on the magnitude of the climate change problem and how difficult it will be to deal with it.

There is no doubt that climate change is fast rising up the global agenda. 

The reports are the Stern Review on the Economics of Climate Change (launched in London on 30 October) and a report on the emission reduction performance of developed countries (issued also on 30 October by the secretariat of the United Nations Framework Convention on Climate Change).

The first report affirms that economic catastrophe will result from a “business as usual” approach and calls for drastic action now.  The second report shows how far away this needed action is, as the developed countries have generally increased rather than decreased their Greenhouse Gas emissions (despite their Kyoto Protocol obligations). 

The 700-page report by former World Bank chief economist Nicholas Stern was released with great publicity by British Prime Minister Tony Blair and his likely successor Gordon Brown.

Its main value is placing an economic dimension to the scientific and political policy debate on climate change.  Its message is that action has to be taken now to avert an economic catastrophe.  It takes an investment of 1% of world GNP now to act in order to avert a 5 to 20 per cent fall in GNP caused by climate change in future.

But in fact it is going to be extremely difficult to get the developed countries, which are the main source of the climate problem (historically as well as presently) to even begin to undertake the massive changes needed to cut Greenhouse Gas emissions by the very steep levels required.

The Stern review accepts the emerging (or rather the emerged) scientific consensus that to avert a major environmental catastrophe, global warming must be limited to no more than 2 degrees above the pre-industrial temperature.

Taking this as the yardstick, the review says that to avert climate catastrophe the Greenhouse gas in the atmosphere must be stabilized at between 450 and 550 ppm of carbon dioxide (CO2) equivalent.  The current level is 430ppm of CO2 equivalent, and it is rising at more than 2ppm each year.

“Stabilisation in this range would require emissions to be at least 25% below current levels by 2050 and perhaps much more,” says Stern.  “Ultimately, stabilization, at whatever level, requires that annual emissions be brought down to more than 80% below current levels.”

Looking at these figures, one has to conclude that to achieve the targets will require tremendous re-organisation not only of energy use but social organization and lifestyles.  But neither the political leadership and will nor the public opinion in the developed countries in recent years have been up to the task. 

This seems to be evident from the Greenhouse Gas Data 2006 report by the UNFCCC (UN Framework Convention on Climate Change) secretariat.

The report said that greenhouse gas emissions by industrialized countries showed a "worrying" upward trend in the 2000-2004 period.

Although the overall emissions by these countries dropped 3.3% in the 1990-2004 period, this was mostly due to a 36.8 per cent decrease by economies in transition of eastern and central Europe (EITs).

Shockingly, the other industrialized Parties of the UN Framework Convention on Climate Change registered an increase of 11%. 

The Kyoto Protocol requires industrialized countries to reduce greenhouse emissions by an average of 5% below 1990 levels in its first commitment period between 2008 and 2012.

"The worrying fact is that EITs, which were mostly responsible for the overall emissions reductions of industrialized countries so far, as a group have experienced an emission increase of 4.1% in the period 2000-2004," UNFCCC Executive Secretary Yvo de Boer said when launching the report in Bonn.

"This means that industrialized countries will need to intensify their efforts to implement strong policies which reduce greenhouse gas emissions," he added. The report constitutes the first complete set of data submitted by all 41 industrialized Parties. The United States, the world's biggest emitter of greenhouse gases, is not a party.

Emission reductions are urgently required in the transport sector but they seem to be especially difficult to achieve, growing by 23.9% from 1990 to 2004, the report noted.

Despite (or perhaps due to) the bleak statistics that indicate that many developed countries are not on track to cut their emissions, the UNFCCC report held up an “escape route” for countries that cannot meet their emission reduction targets.

That escape route is for those under-performing developed countries to fund climate-friendly projects in developing countries and thus earn “credits” allowing them to continue emitting Greenhouse Gases above their permitted level.

Thus, the UNFCCC data is really gloomy as it show an overall lack of action on the part of industrialized countries, and even then excluding the US, which itself has one of the poorest records.  According to one estimate, the United States’ emission level in 2005 was 12% above the 1990 level and could rise to 30% above that level in 2012.

Thus, the upbeat and optimistic tone with which the UNFCC’s top official launched the report contradicts the seriousness of the situation.  After all the Kyoto Protocol targets are already grossly inadequate.

If many of the industrialized countries are unable to meet their reduction targets under this inadequate regime, and are on the contrary on track to actually increase their emissions, the UNFCCC should be (but is not) sounding big alarm bells.

The alarm bells were instead rung by the Stern report.  It endorses the view that there is overwhelming scientific evidence that climate change is a serious global threat demanding an urgent global response. It then makes a simple conclusion – that the benefits of strong and early action far outweigh the economic costs of not acting.

This week the battle to tackle climate change shifts to Nairobi, where the annual meeting of the Climate Change Convention takes place.

A lot of headed discussion is expected to take place, but no critical action is expected.