Action on climate change must include India, China: IMFApril 5th, 2008 - 12:24 pm ICT by admin
By Arun Kumar
Washington, April 5 (IANS) Any policy framework for multilateral action on climate change would be costly and politically difficult without including large and fast-growing economies such as India, China, Brazil, and Russia, according to the IMF. “That is because during the next 50 years, 70 percent of emissions are projected to come from emerging and developing economies,” Simon Johnson, economic counsellor and director of research at the International Monetary Fund (IMF) said here Friday. Emissions of greenhouse gases, mainly carbon dioxide, are warming the atmosphere and leading to climate change, with severe adverse impacts. Countries around the globe are now negotiating a multilateral strategy to mitigate greenhouse gas emissions after 2012, when the current international pact for the purpose runs its course.
“To minimise the costs of mitigation policies, it will be crucial to build a framework that is sustainable and provides incentives for broad country participation,” Johnson said at a press briefing ahead of next week’s spring meetings of the World Bank Group and the IMF.
The costs of mitigation need to be distributed equitably on a global basis. Transfers under cap and trade schemes need to account for how easily different countries could reduce emissions. Under these schemes, a firm that found it costly to reduce its greenhouse gas emissions below a given cap could trade for so-called carbon credits from another firm anywhere in the world.
A scheme generating a flow of transfers toward emerging and developing countries would reduce the costs of carbon pricing policies for them and would encourage their participation, Johnson said.
Natalia Tamirisa, an IMF researcher, said the fund’s research had not produced any original estimates of damages from climate change. And review of the literature suggests that generally these damages are likely to fall on future generations.
“But already now we do see examples of how climate change affects countries,” she said. “For example, in India and Bangladesh there is increased incidence of droughts. There are also floods that tend to follow different patterns than historically, and scientists tend to attribute this also to the effects of climate change.”
It is important that any sort of policy on mitigating climate change covers a broad group of countries - advanced emerging market economies and developing countries - because in the next 50 years it is projected that 70 percent of emissions will come from emerging and developing economies, Tamirisa said.
The provision of the proposed incentives will depend on the specific design of mitigation policies, she said. For example, on the cap and trade policies or hybrid policies, it is possible to design them in a way that would generate some financial transfers towards emerging and developing countries.
This would help provide incentives for these countries to join mitigation efforts and also reduce the cost of mitigation efforts for these countries, she said.
These transfers, if they’re significant, could be associated with certain economic effects and it was important to put in place supporting policies to counter such effects, according to her.
Tags: arun kumar, carbon credits, climate change, country participation, developing economies, economic counsellor, future generations, global basis, greenhouse gas emissions, greenhouse gases, india china, international monetary fund, international monetary fund imf, international pact, multilateral action, multilateral strategy, policy framework, simon johnson, spring meetings, world bank group