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Copenhagen Battle for Climate Action with Equity

It now seems certain that the United Nations conference on climate change in Copenhagen in December will not see the adoption of a detailed and legally binding agreement. But a political declaration with a framework for a future global deal that is more likely to emerge from the summit would be no less important, for such a declaration will draw the contours of an agreement on climate change and cover many issues of importance for the developing countries - the future of the Kyoto Protocol, common and differentiated responsibilities of rich and poor countries and an agenda for the "advanced developing countries". This article outlines the challenges before the developing countries at Copenhagen.


Copenhagen Battle for Climate Action with Equity

Martin Khor

package is decided on in Copenhagen it can become the most important aspect of a final agreement on climate change. Copenhagen could thus turn out to be a vital decision-making meeting after all. It may not “seal the deal” (the slogan of the UN Secretary General) but it may formu-

It now seems certain that the United Nations conference on climate change in Copenhagen in December will not see the adoption of a detailed and legally binding agreement. But a political declaration with a framework for a future global deal that is more likely to emerge from the summit would be no less important, for such a declaration will draw the contours of an agreement on climate change and cover many issues of importance for the developing countries – the future of the Kyoto Protocol, common and differentiated responsibilities of rich and poor countries and an agenda for the “advanced developing countries”. This article outlines the challenges before the developing countries at Copenhagen.

Martin Khor ( is executive d irector of the South Centre, which is h eadquartered in Geneva.

Economic & Political Weekly

november 28, 2009

he prospects for a “global deal” on climate change in Copenhagen in December have been vanishing rapidly. At the Asia Pacific Economic C ooperation (APEC) summit in Singapore in mid-November, political leaders came to the conclusion that a legally binding agreement in Copenhagen was not possible to achieve, given the many outstanding issues that cannot be resolved in time. A “political declaration” is now to be aimed at instead. What this implies is that the Copenhagen conference of the UN Framework Convention on Climate Change (UNFCCC) that is scheduled for 7-18 December may adopt some principles that had probably been agreed to before, and perhaps some agreed language on the p arameters on which to continue the discussions, for another six or 12 months.

There should, however, not be any complacency that Copenhagen will not make any significant decisions. If a full agreement cannot be obtained, it can be expected that some Contracting Parties (countries that have signed the UNFCCC) especially the developed countries, will try to obtain a kind of “framework agreement” in which their key positions are reflected and which will form the basis and parameters of further negotiations in 2010. This could be in the style of the “July Package” negotiated in 2004 in the World Trade Organisation (WTO) as part of the Doha round of trade negotiations. At that time, although the Doha round could not be completed, the WTO parties agreed to a framework agreement in July 2004 that set the principles, parameters and formulae that became the basis for much of the negotiations that followed in the next five years.

The framework sets and thus locks in the structure and parameters and even the method to calculate the final figures for emission cuts, etc, if such a framework

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late the structure and basis of a deal, with d etailed figures to be filled in later.

There are many vital and complex i ssues that lie at the heart of the impasse in the climate talks that make a detailed and comprehensive agreement at Copenhagen a vanishing prospect. These differences, mainly along North-South lines but also among developed countries, became more evident in the last two sessions of the UN climate talks, in Bangkok in October and in Barcelona in November. The climate change talks have been taking place in two tracks, one under the working group on long-term cooperative action (LCA), which is the follow-up to the Bali Action Plan of 2007 aimed at the “full, e ffective and sustained implementation of the Convention”, and the other under the working group on further actions under the Kyoto Protocol (KP), in which developed countries are to fix new commitments to reduce their emissions after the 2012 e xpiry of the first commitment period.

While many countries’ political leaders have made solemn pledges to do their best on climate change, for example at a UN summit meeting in September, the reality is that these are very complex negotiations not only on environmental issues but deepseated economic issues involving the distribution of environmental and economic r esources worldwide. To reach a fair and equitable deal has become elusive.

In recent months, there have been intense pressures to get “advanced developing countries” like China, India, Brazil and others to commit to reduce greenhouse gas emissions, perhaps as a preparation to shift the blame to them if Copenhagen fails to reach a deal. But there is not even an agreed definition of “advanced developing countries” or even “major emitters”. India has a large population, but that does not make it an advanced country or a m ajor emitter. In per capita terms (which is the essential way for measurement), it


lies low in income or in carbon emissions. Moreover, the promised financial and technology transfers to help developing countries to shift to a sustainable development path are still nowhere in sight. The amount of funds being talked about is far too little, given the enormity of the task.

There are several areas of contention that are far from resolution. These issues will preoccupy the negotiations in Copenhagen and beyond.

Sabotaging Kyoto

The first and foremost is the architecture of the global climate regime. At present there is the UNFCCC and there is its KP. D eveloped countries who are KP members (all except the United States – the US) have made internationally legally binding commitments under the KP’s first commitment period to cut their emissions by an aggregate of 5.2% by 2012 as compared to the 1990 level, and each country has its own target to meet. Negotiations under the KP working group have been g oing on since 2005 for the aggregate emission cut and the individual countries’ cuts, for the second commitment period starting in 2013. An outcome on this aspect is scheduled in December at the Copenhagen conference, so that there is enough time for the smooth carry-over from the first to the second commitment period. Contrary to misinformation in the media and elsewhere, the KP does not expire in 2012.

Since the US is not a KP member, and is unlikely to join the protocol, a method was devised in paragraph 1b(i) of the Bali Action Plan for developed countries that are not KP members to make “comparable efforts” to those in the KP. The developing countries do not have to make binding emission-reduction commitments under the KP, but the Bali Action Plan in paragraph 1b(ii) obliges them to take nationallyappropriate mitigation actions enabled and supported by finance and technology from developed countries, which together are to be measurable, reportable and verifiable (MRV). There is thus a clear distinction (based on the equity and the common but differentiated responsibility principles) between the legal commitments of developed countries and the actions of d eveloping countries, backed by finance and technology, and this distinction in the two sub-paragraphs is one of the most i mportant of the understandings reached in Bali.

It was the understanding in Bali that these three pieces would form the basis of mitigation negotiations, with a result in Copenhagen of a deal on the second commitment period in the KP under the working group of the protocol, and a deal on the US commitment under para 1b(i) in the LCA working group and an outcome on developing counties’ actions together with finance and technology under para 1b(ii) of the LCA group.

However, what was signalled in Bangkok in early October was confirmed in Barcelona in November, that almost all the developed countries have decided to abandon the KP. They apparently want to join the US, and establish a new agreement, which is likely to be a climbdown from the internationally l egally binding regime that is Kyoto, to a collection of n ational efforts and a peer review by parties to the UNFCCC of the national performances in the new agreement. This low-grade framework is widely termed “pledge and review”. It can be predicted that this will be the basis of the proposed “new agreement” because the US has made clear it will not sign on to an i nternationally binding agreement to cut emissions – u nless China, India and other “advanced developing countries” also sign on to such an internationally binding agreement. This is highly unlikely as these developing countries are under no obligation to do so under the UNFCCC and moreover there is no clear or agreed criteria on why certain developing countries should be “selected” to join in.

Although in retrospect this abandonment of the KP was on the cards (it was implied in the proposals of several developed countries earlier this year), it still came as a shock to the developing countries when they realised that the last d eveloped country member standing on the KP ship, the European Union, had also decided to jump to a “single new agreement” which they want to negotiate under the LCA working group. The G-77 and China made clear in Bangkok and Barcelona that they would not accept this climbdown of developed countries from an internationally binding regime to a loose national

november 28, 2009

pledge and review system. They called on the developed countries which are members of the KP to complete the negotiations for a second period, while a comparable US commitment could be agreed to under the UNFCCC. China described the attempted move by developed countries from the KP to a new loose agreement as an attempt at a “great escape” from their responsibilities, and said that the two trains to Copenhagen are about to be derailed as one train on the KP track was about to crash and its debris would scatter on the LCA track and would threaten that train to also be turned upside down. Other developing countries and groupings made similar statements.

Low Level of Ambition

The second issue is the very low level of ambition of developed countries in emissions reduction. A fundamental foundation of an environmentally ambitious and an equitable global climate deal is that d eveloped countries cut their emissions deeply. The greater the cut, the more will be the atmospheric space left for developing countries. Developing countries have asked that developed countries cut their emissions collectively by at least 40% by 2020 (compared to the 1990 level). The IPCC (Intergovernmental Panel on Climate Change) fourth assessment report has also been interpreted to conclude that developed countries need to cut their emissions by at least 25% to 40% by 2020.

Unfortunately the announcements made by individual developed countries, when added up, only amount to an overall cut of 16% to 23% (excluding the US), according to the UNFCCC secretariat data distributed in Barcelona. And the aggregate is only 11% to 18% if the US is included, according to an estimate of the Alliance of Small I sland States. The developing countries are aghast at such low levels of commitments. Even then these national announcements and pledges are over-stated because a significant part of the reductions will not be done domestically by the developed countries, as they plan to have developing countries undertake some of the emissions reductions for them through “offsets”; and moreover the figures are linked to conditions (including that other developed countries make comparable efforts and in a few cases that some developing countries

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also commit to take mitigation actions that are deemed satisfactory).

At the Barcelona session, the developing countries, led by the Africa Group, insisted that the developed countries in the KP make serious attempts to commit to a credible set of “numbers” on the aggregate cut and the individual country cuts. They proposed that discussions on other issues (such as the possible expansion of ways to “offset” the emissions, or of new market mechanisms) in the KP group be suspended to give more time to the discussion on numbers. The developing countries were making the point that all other issues would be secondary or irrelevant if the developed countries do not commit to figures on emission reductions that are serious. At one point in the Bangkok session, the chair of the KP group remarked that if the low numbers are not improved, “we will be the laughing stock of the world” at the end of the Copenhagen conference.

Pointing Fingers at Developing Countries

The third issue is the continued attempt by developed countries to shift the burden of responsibility to developing countries, and in violation of the principles and provisions of the Convention and the Bali A ction Plan, which have clearly demarcated the “common but differentiated responsibilities” principle. At Bangkok and Copenhagen, intense pressure was piled on the developing countries to take on more obligations on mitigation that are beyond what was agreed and mandated in the Convention and the Bali Action Plan, which make a clear distinction between the binding mitigation commitments of developed countries to reduce emissions, and the mitigation actions of developing countries, supported and enabled by finance and technology, and in the context of sustainable development. The US led the charge, stressing its point that the “common responsibilities” have to be worked out, and not just the “differentiated responsibilities”. It even insisted on a special group or special sessions on these “common actions”, thus attempting to blur the carefully devised firewall between the Bali Action Plan’s para 1b(i) on developed countries’ mitigation commitments and para 1b(ii) on developing countries’

Economic & Political Weekly

november 28, 2009

a ctions. A “non-paper 28” on these common actions was prepared by the chair of the LCA group, and it has been mainly r ejected by the G-77 and China.

The attempt to shift responsibilities i ncluded proposals to get developing countries to adhere to new and broad reporting and verification procedures similar to developed countries and beyond what the Bali Action Plan mandates. In addition, there were proposals to get some “advanced developing countries” to adhere to reduction emission targets, to get developing countries in general to commit to have “deviation from business as usual by 15 to 30%” in their emissions levels, both of which were not agreed to in Bali nor are they in the Convention’s provisions, and to introduce a “graduation process” by which some developing countries (those with a significant emission profile and changed economic conditions) have to take on more mitigation obligations. The developed countries are also pressing developing countries to contribute to the international funding of the developing countries’ climate actions, which is against the Convention provision that it is the developed countries which are to fund the agreed full costs incurred by poor countries to prepare their national reports and to fund the agreed full incremental costs of their climate actions.

Non-fulfilment of Compact

The fourth issue is that the adequate means to enable developing countries to take actions are still not forthcoming. The three enabling factors are financial r esources, technology development and transfer and capacity building. The developing countries repeatedly stressed what to them is the heart of the UNFCCC’s compact, that the extent to which developing countries meet their obligations to take climate change actions depends on the e xtent to which the developed countries meet their commitments to developing countries on providing finance and technology, a key principle enshrined in Article 4.7 of the Convention.

In the current negotiations on finance and technology, there are two categories of issues: structural or architectural i ssues, and policy and other issues. On the issues of structure, the G-77 and China in

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August 2008 submitted proposals that a new financial architecture as well as a new technology mechanism be established inside the convention, under the authority of the Conference of Parties. It also wants a new structure for adaptation. The developed countries have been reluctant to accede to the G-77 and China proposals, and came up with their own much weaker i deas on how finance and technology can be strengthened. They argued that existing financial institutions (especially the Global Environment Facility and the World Bank) should be used, and not a new fund inside the convention that the G-77 proposed. They were also against the G-77’s proposal for a new executive body on technology which can take decisions on technology-related policy and oversee actions to transfer technology, arguing that an existing or new advisory group is sufficient.

At Bangkok and Barcelona, there was some progress in the talks on finance structure, with some developed countries seeming to bend towards a financial mechanism to be overseen by the Conference of Parties, though they still insist on the funds to be channelled through existing institutions. On the technology decisionmaking structure, there is yet to be a cceptance by developed countries. At Copenhagen, the G-77 and China can be expected to insist that their proposals to set up new structures – meant after all to make the implementation of commitments made under the convention more effective

– be adopted, at least in principle. If there can be no headway on even the simple question of strengthening the UNFCCC through new structures, then there is little hope of progress in other areas.

On other issues linked to finance, two important questions are the adequacy of the quantum of funds, and the sources of funding (especially on whether funds should be from the public sector or the private sector, especially carbon trading). In September, the United Nations Department on Economics and Social Affairs published a detailed report estimating that $500 bn-$600 bn is required annually by developing countries for mitigation and adaptation, and that most of the funding should come from the public sector, in a Marshall Plan type of programme aimed


at helping developing countries deal with Europe would fund ¤ 2 bn-15 bn. And in
climate change. The economist Nicholas the near term, 2010-12, there would be only
Stern (who authored the report Economics ¤ 5 bn-7 bn a year, with Europe contributing
of Climate Change for the UK government) ¤ 0.5 bn-2.1 bn.
estimated that the annual cost of global These figures are extremely low, espe
climate action is about 2% of the world’s cially since they cover the whole range of
gross national product or GNP (around activities – mitigation (reduction of emis
$1,000 bn today or $2,000 bn in 2050). He sions), adaptation (coping with the effects
advocated $130 bn per annum of public of climate change), capacity building (the
funding from developed countries for use development of institutions) and techno
by developing countries ($15 bn for forest logy development. The proposed amounts
conservation, $40 bn for R&D and $75 bn pale in comparison with the estimates
for adaptation), and also estimated another made by many organisations of what is
$50-100 bn flow to developing countries needed by developing countries to fight
for mitigation, through carbon trading. climate change. Besides being so inade-
On adaptation alone, the UN Climate quate in quantum, the European proposal
Convention secretariat estimated the also comes with many conditions and as
g lobal annual costs at $40 bn-$170 bn. But sumptions. These include that some devel
the actual adaptation costs are two to oping countries should also contribute to
three times higher in the sectors covered the international funding, that they must
by the report, according to a recent study agree to cap their emissions and take part
by the International Institute for Environ in carbon trading within a certain year,
ment and Development and the Grantham that much of the funding will go through
Institute of Imperial College London. And existing channels such as bilateral aid and
if sectors left out of the secretariat report the World Bank. The EU expects develop
are included, the cost would be higher ing countries to get most of their funding
still. For example, the cost of protecting from their own domestic resources, or
eco-systems could cost $350 bn. Another from the carbon market. But an interna
study by scientists in China estimated the tional carbon market is yet to exist and
cost of reducing China’s emissions as $438 can be expected to face many glitches. For
bn per year within 20 years. example, how can a developing country
The G-77 and China had originally plan a reform of its energy or transport
proposed that developed countries pro sector seriously when the funds it will rely
vide at least 0.5% to 1% of their GNP on have to come from the carbon market
(which is around $200 bn-400 bn a year) and there is no way of telling what the
to fund developing countries’ climate price of carbon will be in two years’ time
actions. This range was proposed in 2008, or even six months from now.
before the latest data were available. On technology transfer, one major issue
Some developing countries and their is the treatment of intellectual property
groupings have now adjusted the figures rights (IPRs). Developing countries gener
upwards, with the African Group for ally view IPRs as a barrier to the transfer
example putting forward the figure of 5% of climate-related technologies from de
of GNP at Bangkok. veloped countries, and to the development
Against this background, the EU’s recent of their own endogenous technologies.
announcement on finance has been very The G-77 and China has proposed that
disappointing. It estimated that developing these technologies be exempted in devel
countries would need ¤ 100 bn a year by oping countries from patents, and that
2020 for climate mitigation and adaptation “technology pools” be established to facili
actions. But it added that the governments tate transfers of technology to developing
of developed countries should fund only countries royalty-free. India, Bolivia and
20-40% of that, while the carbon market other countries also put forward propos
will come up with 40% and the developing als on IPRs and technology transfer at the
countries will self- finance 20-40%. It pro- Barcelona session. The developing countries’
posed that inter national public financing proposals imply calling for a review of the
for developing countries’ climate activities international regimes, including the WTO’s
would be ¤ 22 bn-50 bn in 2020, of which TRIPS agreement. However, the developed
28 november 28, 2009

countries are against any relaxation of the present international rules on IPRs. This is not surprising because most patents linked to new climate-related technologies such as renewable energy are owned by companies of developed countries.

Shared Vision

The fifth issue is the North-South distribution of responsibilities in a “long term goal for emissions reductions.” The Bali Action Plan mandates that a “shared vision” for long-term cooperative action be established, that includes such a long-term goal. The discussions on shared vision have been contentious. Developed countries are proposing a 50% global greenhouse gas emissions cut by 2050 from 1990 levels (from 38 bn tonnes in 1990 to 19.3 bn tonnes in 2050). The G-8 in its summit this year announced it is willing to take a 80% cut, and this has been repeated by the US in Bangkok and Barcelona. The figures of a 50% global cut and a 80% developed-countries’ cut by 2050 are contained in drafts (known as “non-papers”) of the “shared vision” issue coming out of Barcelona. Indeed, if there is one outcome in a “political declaration” that the developed countries want from Copenhagen, it is the 50% figure, if possible backed up by the 80% figure.

Behind the figures, however, are very significant implications for developing countries and the future distribution of world emission rights and of world income. A 50% global cut implies global GHG emissions dropping from 38 bn tonnes (of carbon dioxide equivalent) in 1990 to 19.3 bn tonnes in 2050. A 80% cut for developed countries implies a drop from 18.3 bn to 3.6 bn tonnes. This proposal implies by simple deduction that the developing countries

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vol xliv no 48


would have to do the rest – that is, accept a 20% cut from 20 bn to 15.7 bn tonnes. As the population of developing countries is expected to double during that period (according to the latest UN estimates), they will end up with a 60% cut per capita. The cuts will be actually even much deeper between 2009 and 2050, b ecause many developing countries have increased their emissions significantly b etween 1990 and the present. As for the developed countries, their population size is projected to be stable between 1990 and 2050, and thus their per capita reduction will be the same as their overall reduction at 80%.

It is unfair to ask developing countries to undertake a per capita emission cut just slightly below (or even the same as, d epending on the base year used) the cut that developed countries are prepared to make. If developed countries were to make a 100% cut between 1990 and 2050, developing countries would still be r equired to make a 52% cut per capita. D eveloped countries would need to reduce their emissions by 213% by 2050, for d eveloping countries to maintain their current per capita emission level. Developed countries would, in other words, need to cut emissions to 0% and create sinks to absorb greenhouse gases equivalent to another 113% of their 1990 emissions. To both developed and developing countries, this may seem impossible. For developing countries it may seem impossible to achieve economic development while maintaining (instead of increasing) their current, low per capita level of emissions. For developed countries it may seem impossible to go beyond a 100% emission cut. But it may need two “impossibles” to make a possible deal.

In order not to exceed the danger level, the world has around 600 bn tonnes of emission of carbon (equivalent to around 2,200 bn tonnes of carbon dioxide) to budget between 1800 and 2050. The d eveloped countries have already emitted 240 bn tonnes of carbon between 1800 and 2008. This is far above their “fair share” of 81 bn tonnes in that period (if their emissions had been at the same ratio as their share of world population). From 1800 to 2008, developed countries have a carbon debt of 159 bn tonnes of carbon (or 583 bn tonnes of carbon dioxide). And,

Economic & Political Weekly

november 28, 2009

given the scenario of a 50% global cut and an 85% developed country cut by 2050, they will emit another 85 bn tonnes of carbon equivalent between 2009 and 2050. Thus, their total emission would be 325 bn tonnes of carbon from 1800 to 2050. Since their fair share is 125 bn tonnes for this p eriod, they have a “carbon debt” of 200 bn tonnes of carbon.

In a fair climate deal, the historical debt would have to be met, at least through sufficient transfers of finance and technology, that would enable developing countries to take their own actions to counter the effects of climate change and to switch to climate-friendly technologies, while maintaining their ability to have adequate economic and social growth and development. Of course, a fair deal also requires developed countries to cut their emissions deeply. The greater the cut, the more will be the atmospheric space left for developing countries. The Copenhagen conference, if it is to be considered a success, will have to go some way at least in pointing to the direction of these solutions, even if it cannot come up with the final solutions.

Thus, some developing countries do not want to agree to a “shared vision” with a goal of reducing global emissions by a certain percentage by a certain year, at least unless and until all the other parts of the equation are discussed transparently and thoroughly, with all the implications set out, and with the adequate finance and technology guaranteed for developing countries to be able to play their part.

Trade and Protectionism

Finally, there is the emerging issue of trade protectionism in the name of climate change. The shadow of this issue has loomed over the climate negotiations, especially after the US House of Representatives approved the Waxman-Markey bill at the end of June 2009, which contains a section requiring the US president to impose border tax adjustment measures on energy-intensive goods imported from developing countries that are deemed not to be taking on the comparable mitigation actions as the US. Such a measure will increase the prices of the imported products. Some European countries may be preparing similar measures. French President, Nicolas Sarkozy said on 10 September he

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“will not accept a system that imports products from countries that don’t respect the rules in France. I will fight for a carbon tax at the borders of Europe.” Referring to the US Congress bill, he said: “I don’t see why if the US can do it and Europe cannot.”

The developing countries are the targets and they will be the losers if these threats are carried out. Compared to the developed countries, they have less funds and technology to make their production systems less polluting. The developed countries, which are mainly responsible for the climate crisis should be assisting developing countries, instead of passing the burden of adjustment onto them.

At the UNFCCC session in Bonn in A ugust, India and other developing countries protested against the trade measures as being against many principles and provisions of the Convention. India proposed that the Copenhagen text include a paragraph stating that

developed country Parties shall not resort to any form of unilateral measures including countervailing border measures, against goods and services imported from developing countries on grounds of protection and stabilisation of climate. Such unilateral measures would violate the principles and provisions of the Convention.

It goes on to cite many such provisions. The developing countries are likely to d emand that such a text be included in the Copenhagen outcome. Some developed countries, particularly the US, can however be expected to argue against it.

The above are some of the major issues where there are wide differences, mainly between developed and developing countries. Even if it is too late for Copenhagen to produce a lengthy and legally binding document, and only a “political declaration” is now expected, these issues will still form the basis for the negotiations on this “political declaration”. After all, a political declaration, especially if it is in the form of a “Decision in the Conference of Parties”, also has a legal status and e ffect, and locks in the framework and p arameters of the future negotiations. C openhagen will thus not be a “picnic”. The emerging view that “nothing will happen in Copenhagen” should not lull the developing countries into complacency, for something surely will happen in C openhagen. The question is what.

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