Who would have thought the smallest countries could influence the Copenhagen conference so much? The Alliance of Small-Island States (AOSIS) whose members fear their existence is threatened by rising sea levels, rarely has a chance for its voice to be heard in international discussions, but it has certainly been making plenty of noise at COP15.
Take Tuvalu – population12,000 and aiming to be carbon neutral by 2020. This week, its negotiator Ian Fry stirred up proceedings by demanding conference attendees discuss his proposal for more substantial emissions cuts, aiming to keep global temperature rise to 1.5oC rather than the 2oC which most politicians are notionally working towards. It is backed by many poor countries vulnerable to climate change effects, including the Maldives which famously staged a cabinet meeting underwater in October. The proposal is now under discussion and although many countries think it is a step too far, it is included as a possible goal in one COP15 draft final text.
Not all developing countries agree with AOSIS. The world has changed since the Kyoto protocol divided it into developed and developing countries; some ‘developing’ countries are now wealthier and more energy guzzling than in 1997. Many are wary of any change to the ‘developing’ label which exempts them from binding reduction targets. China, for example, argues that despite increasing emissions its per capita emissions remain low, some emissions are from manufacturing exported by developed countries, and it already has reduction mechanisms such as high fuel standards for cars and subsidies for renewable energy. AOSIS and some other ‘Least Developed Countries’ think wealthier developing nations could shoulder more responsibilities.
Alongside these disagreements, is the question of how much the developed world should pay to help poorer countries develop clean technology, improve forest and land management, and adapt to climate change consequences such as water shortages. The already existing Clean Development Mechanism has delivered around $4billion to developing countries so far (with around half going to China for cleaning up industries and developing renewable energy), but this falls short of the estimated amounts necessary. The need for more funds is urgent. In India, for example, the city of Mumbai is currently experiencing severe water shortages with rationing reducing the supply up to 30% in some districts leading to violent clashes with the police.
On Thursday evening, the EU debated funding for a ‘fast-start’ fund and has since pledged €7bn over the next three years (with the UK pledging £1.5bn). The developing world, though, is hoping for total pledges of £120bn. Negotiations are ongoing for both ‘fast-start’ money and long-term finance. At the moment, most mechanisms under discussion involve government funding but pragmatically some private sector investment would also be required. We’ll be keeping an eye out over the next week for what this might mean for global investors, both real estate and otherwise.
Whatever the outcome at Copenhagen, it seems clear that the world will have to listen to developing countries. Where poor countries could perhaps have had their silence bought in the past, many are too convinced of the potential catastrophic impacts of climate change to let this one go quietly. They may yet succeed in forcing developed countries to bolster their emissions reduction targets and provide greater sums of funding.