News and Analysis • Volume 11 • Number 6 • October 2007
Much Talk But Little Action on Climate Change
As a key United Nations conference in Bali next December draws closer, political activity around issues related to the mitigation and adaptation to climate change is intensifying worldwide.
Parties to the Kyoto Protocol agreed in August on the need to cut greenhouse gas emissions to less than 25-40 percent of their 1990 levels by 2020 (the present commitment period ends in 2012).
At a late September climate summit hosted by UN Secretary-General Ban Ki-moon, the EU and Japan called for halving emissions by 2050 compared to the 1990 benchmark, and leader after leader underlined the seriousness of the situation.
Pakistan’s Environment Minister Syed Faisal Saleh Hayat said that rich countries should deepen their reduction commitments in the next phase of the Kyoto Protocol, as well as help poorer nations avoid increases in their own greenhouse gas emissions. Prime Minister Keith Mitch of Grenada called global warming was ‘the single most important threat’ facing the security and very existence of small island developing states, which should be given priority in any global fund set up to cope with climate change.
Numerous developed and developing countries appealed to the United States to join the protocol, but Secretary of State Condoleeza Rice gave no sign of a change of heart in the long-held US position that major developing country emitters must agree to binding reduction commitments first. The latter countered that the ball still lay firmly in the developed country court, although many – including China and Brazil – also stressed that they were already taking measures to mitigate the effects of climate change on a voluntary basis.
US Defends Non-binding Targets
Immediately after the UN summit, President Bush convened a meeting of the world’s 16 greatest greenhouse emitters.1 The purpose was to further develop his suggestion that these nations should jointly develop a new ‘long-term global goal’ to reduce greenhouse gasses, after which each country would work to achieve the goal by establishing “its own ambitious mid-term national targets […] based on national circumstances” (Bridges Year 11 No.4 page 12).
Responding to allegations that the initiative sought only to let the United States off the hook, US Ambassador to the EU Boyden Gray drew a parallel with the development of the Montreal Protocol on phasing out ozone-depleting substances. In that process, he argued that “the US pulled aside a dozen or so big economies in an effort to inject some focus and prioritisation into an unwieldy process involving more than 150 countries. The effort worked and ultimately culminated in [...] the most successful international environmental agreement ever negotiated” (Financial Times, 27 September 2007).
While many hailed the White House meeting as a welcome sign of renewed US engagement on the climate front, the gathering did not produce any concrete commitments to action. Earlier in September, Asia-Pacific Economic Co-operation (APEC) members agreed on ‘aspirational’ climate goals to reduce energy intensity by at least 25 per cent by 2030 and to increase forest cover by 20 million hectares by 2020. The Economist suggested that the APEC summit merely created “the illusion that something is being done and so weakens other efforts to reach meaningful agreements on, for example, climate change and trade.”
Trade-related Measures Raise WTO-consistency Concerns
To implement whatever targets are agreed in Bali, governments are likely to take measures to ensure that their industries do not suffer politically unacceptable consequences. In the US, for instance, a bill has been introduced to Congress that would require the administration to annually review the climate policies of the country’s five largest trading partners – currently Canada, China, Mexico, Japan and Germany – to determine whether they have taken measures comparable to those of the US to limit greenhouse gas (GHG) emissions. US importers of GHG-intensive goods from countries found not to have taken comparable actions would need to purchase ‘international reserve allowances’ (i.e. GSG emission credits) issued by the US government.
While such a measure could possibly qualify as an exception under GATT Article XX(g), which allows measures “relating to the conservation of exhaustible natural resources,” China and Mexico have already indicated that it would need to be discussed at the WTO. On 26 September, Mexico’s Environment Minister Juan Rafael Elvira Quesada warned that the proposed legislation would “only lead to a series of protectionist measures that have no link to the environment at all,” adding that Mexico “would not be in accord with this measure.” The approach under consideration in the EU could be even more controversial, as the European Parliament has called upon the European Commission to consider the possibility of imposing offsetting tariffs on imports from countries that are not parties to the Kyoto Protocol – in practice the US and Australia. So far, the Commission has rejected the idea, partly because such a tariff might be challenged at the WTO.
On a different front, Japan and the US have united forces to push for the elimination or reduction of import tariffs on energy-saving products, such as fuel and solar cells, as well as wind power generators. Japan reportedly wants to make the initiative one of the major achievements of the G-8 summit it will host in 2008. While other G-8 members are expected to support the initiative in principle, differences are likely to arise over the list of products targeted, particularly with regard to the automobile sector.