‘Unfortunately, the most of the Sri Lankan business community are not aware of this new avenue of revenue. Not only private sector but also the public sector is not aware of the carbon market. It does not mean that Sri Lanka is fully unaware of the carbon market. Several companies involved in mini hydro power generation and Teak foresting have already sold carbon credits.’
(October 04, Colombo, Sri Lanka Guardian) Environment and Natural Resources Minister Patali Champika Ranawaka addressing the 'Key Persons Forum' organized by the Federation of Chambers last week said that the development model for this Century is sustainable development based on Buddhist principles. Hence, we can make Sri Lanka the focal point of the world in this century bringing back the glory of Anuradhapura era.
The Minister was speaking on introducing environment regulations – impact on business and general public.
Following is the full text of his speech:
"First of all, let me thank your President Mr Nawaz Rajabdeen and his staff of the Federation of Chambers of Commerce & Industries in Sri Lanka for inviting me to deliver a speech on an interesting and pertinent topic, namely, "Introducing Environment Regulations – Impact on Business and General Public". As an introduction to the topic, let us make an attempt to understand the present trends in the world, specially, the post-cold war world.
Soon after the end of the cold war, there was a debate in the world about emerging new world order. Joining this academic debate, Francis Fukuyama published an essay in 1990 titled "The End of History?" in the international affairs journal "The National Interest". In this article, Fukuyama argued that the end of cold war marked triumph of the Western world ensuring domination of the West over the world. This theory is now known as "Western triumphism".
In 1993, Samuel Huntington published a thesis titled "Clash of Civilizations" in which he challenged Fukuyama's Western triumphism. He argued in this thesis, end of cold war does not mean western domination over the world. Instead, there would be a clash of different civilizations in the world. He in fact identified four major civilizations which would compete each other for domination. Those are Christian civilization or Western Civilization, Islam or Arabic civilization, Hindu or Indian Civilization and Sinic Civilization which is inclusive of Buddhist Civilization.
When Huntington introduced this theory, Islamic group Al Qaeda had not challenged the western domination; India and China had not been identified as emerging super powers. Instead, they were struggling to survive with the poverty and natural disasters. Nevertheless, clash of these four civilizations is now crystal clear. When Islamic civilization militarily challenges the western domination, Sinic Civilization has politically and economically challenged the West. In the same time, Hindu civilization has posed a cultural and economic threat to the West.
Look at the Western economy. It is now fully dominated by our neighbours, Indians. There are four Indians among twenty richest people in the world. They are Lakshmi Mittal, Mukesh Ambani, Anil Ambani and Azim Premji. This new phenomenon was theoretically analyzed by Kishore Mahbubani in his book titled "The New Asian Hemisphere". He advised the West in his book to admit the fact that Western domination over the world is now over. Hence, he suggests to the West that the West must gracefully give up its domination of global institutions, from the IMF to the World Bank, from the G7 to the UN Security Council. He further points out that the present trend should not be considered by the West as a threat. They should consider this new world order as an opportunity to revive their dieing economies being active partners of rising Asia.
Fritjof Capra analyzed this trend further in his book titled "The Turning Point". He brought two important points in his book to the attention of the world. Firstly, the modern development paradigm which is based on Yanki-Euro centered development has reached to its logical end due to scarcity of resources and environmental pollution. Secondly, the world is so integrated that sudden revolutionary shift from Europe to Asia cannot be taken place. There is a need of a paradigm shift from modern development to sustainable development. Sustainable development is defined as "meeting the needs of the present without compromising the ability of future generations to meet their own needs." Capra's model for sustainable development is based on Buddhist principles such as simplicity, co-existence and selflessness.
Dear friends,
What are the conclusions we can make listening to my analysis of the present world. In summary, there are two points. This century belongs to Asians, including us. The development model for this century is sustainable development based on Buddhist principles. Hence, we can make Sri Lanka the focal point of the world in this century bringing back the glory of Anuradhapura era.
Global warming is the main factor which has forced the world community to think of sustainable development. Due to human activities, factories and automobiles emit carbon to the environment. Scientists have found that increasing global warming is caused by the increase in the carbon content in the atmosphere.
With global warming, ice in the Arctic and Antarctic poles began to melt down. People live near the Arctic pole were amazed with this new development. They thought there will be shorter sea routes from Canada to Europe and Japan. But they have now realized the gravity of the problem. Countries like Netherlands and Maldives are at a risk of being sunk in the sea.
With global warming, there are radical changes in the eco systems. A lot of species have become endangered since those failed to adapt the new conditions. On the other hand, several insects and plants have shown abnormal growth. Along with unusual growth of certain species, people have faced new epidemic diseases. In other words, global warming has changed our earth a foreign place to all of us.
Environmentalists warn that unless we take urgent steps to arrest this trend of global warming, there will be only bedbugs and cockroaches in this world in 100 years time. All other animals will be disappeared since those cannot bear the heat and other environmental changes resulted by global warming.
So, we now end up with a one billion dollar worth question. Do we do all these development activities for the benefit of bedbugs and cockroaches? We work around the clock. We build strong business empires. We build palace like houses. We purchase luxury vehicles. We invent new equipments to make our life comfortable. But do we take any of these at our death? No Not. We repeatedly say "we do all these for our next generation". However, if we make this earth too hot for our next generation to survive, they will not be the ultimate beneficiaries of what we do today. There will be only bedbugs and cockroaches to enjoy what we have built for the next generations.
In the light of above, have we thought of future generations? No. We have been thinking only about ourselves, our comfort, serving our greedy needs. We have been very selfish ignoring the survival of our next generations.
Global warming is only one of hundreds of environmental problems resulted by the so called development activities of the human. There are many. In the name of development, we have been destroying the environment for the last three centuries. Environment is wonderful. If you look after the environment, it looks after you. If you hurt the environment by drastically changing, damaging or polluting it, the environment will also hurt you by causing global warming, floods, droughts, earth quakes, earth slips, Tsunamis and epidemic diseases.
You may have now realized that we have been digging our own graves in the name of development. As responsible citizens, I am sure you want to adhere to principles of sustainable development. You may be wondering how you could know more about sustainable development. That is why there is Ministry of Environment to assist you.
A lot of members of the business community think that the Ministry is there to be a barrier in achieving their business goals. That is a misconception. We are not here to harass you, interrupt you but to assist you by guiding you to perform your development activities in an environmental friendly manner.
Frankly, I do not want the Ministry to become the Environment Police to come behind you and punish. Instead, I want the Ministry to become the Environmental friend in your business who assists you to conduct your activities in an environmental friendly manner. I strongly believe if business community realizes the importance of conservation of environment, we will not have to force them to follow environmental laws. Instead, they will volunteer to follow the same. Hence, I focus environmental awareness campaigns more than law enforcement.
We provide you guidelines to follow for your own benefit, for your future survival. In fact, we think about you more than you do. You think of today. We think of tomorrow. We want your business to survive in future as well. For that, there should be people around to purchase your goods and services. That is why we force you to conserve the environment in your activities. Unfortunately, business community sees the Ministry not as a friend, but as an enemy. Because of a few stubborn and ignorant members of business community, we are forced to introduce strict legal provisions, tedious procedures and constant monitoring. The Ministry has now decided to have a close and constant dialogue with the business community in formulation of new environmental laws. We intend to get feed back of the industry in respect of future regulations to be introduced by the Ministry.
Few decades ago, there was a popular belief that the government should intervene to regularize everything including the markets. After the collapse of socialist block, free market principles received wide appetence in the world. We apply market principles in environment management through market based environment management instruments instead of depending only on regularization. Recently introduced environmental conservation levy is such an instrument.
We introduced an environmental conservation levy on mobile phones to raise funds for Ewaste management. There is rapid growth in Electronic waste which is also known as Ewaste in the recent past. Ewaste includes outdated /discarded electronic equipments such as mobile phones, televisions, computers, refrigerators and washing machines. According to a survey conducted by our Ministry in 2007, electronic equipment market grows 7-10% per annum. Introduction of new/sophisticated electronic equipment to the market, continuous drop of prices of electronic equipment and growth of per capita income have caused the significant growth in electronic equipment marked and thereby Ewaste.
Ewaste contains a lot of hazardous metals/materials such as Nickel, Cadmium, Mercury, Bromine, Cobalt, Arsenic, Lead and heavy metals. When these substances are disposed in an environmentally unsound manner, those would reach human body through food and water. These hazardous substances are potential of causing cancer, asthma, kidney failures, liver failures, loss of vision and ailments associated with respiratory system, diabolism system and nervous system.
In addition to above negative impacts on human health, there will be water, air and soil pollution caused by Ewaste. As a result of these pollutions, the government will have to increase its expenditure on health, forest conservation, wildlife conservation, soil conservation/purification and water purification. Soil and water pollution have a negative impact on crop harvest resulting food scarcity. Therefore, there is an urgent need of launching a Ewaste management project to avoid the said adverse impacts.
The government usually raises funds required for ministerial activities through introducing or increasing general taxes such as Value Added Tax (VAT), excise duties and import duties. When funds required for environmental pollution control are raised through general taxes, both polluters and non polluters who live with limited requirements are equally burdened with the cost of pollution control. It is against equity principle in taxation. The cost of the pollution control should be borne only by the polluters. This concept is now globally accepted and has been incorporated in Principle 16 of Rio Declaration of 1992. Sri Lanka is also a signatory to this Declaration and obliged to incorporate this principle in pollution control activities. Hence, Environment Conservation Levy Act No 26 of 2008 is a step taken by the government in this direction.
Another objective of the environmental levy is to cause a behavioral change in the people towards conservation. Taxes can be used as a tool to encourage people to engage in environment friendly activities and to discourage environment unfriendly activities. Hence, this tax is not a mean to boost government revenue as the widespread belief.
Another mean we have planned to help the business community is to establish Sri Lanka Carbon Fund. First of all I should explain what carbon trade is. Although carbon trade was introduced eleven years ago at Kyoto Summit, the business community is still not familiar with this concept.
Earlier, we discussed about global warming. Realizing the deadly consequences of global warming, 38 industrial nations volunteered to cut down their carbon emissions through Kyoto Protocol. Accordingly, they committed to reduce their carbon emissions by 5 to 8% from their carbon emission in 1990. These nations are supposed to meet their commitment in the period from 2008 to 2012.
If the committed nations fail to reduce their carbon emissions by agreed quantity, they can purchase carbon credits from the developing nations to bridge the gap. Any activity which reduces carbon emission or absorbs carbon in the air considers qualified for carbon credit. Price for a carbon Metric ton is determined by the demand and supply. At present, 1Mt of carbon credit trades in the range of $10-25. This process is known as carbon trade. In 2005, per capita carbon emission in USA was 22 Mt. But the same in Sri Lanka was 0.6Mt while the world average was 4.5Mt. As a low carbon emitting country, we are eligible to sell our carbon credit.
Unfortunately, the most of the Sri Lankan business community are not aware of this new avenue of revenue. Not only private sector but also the public sector is not aware of the carbon market. It does not mean that Sri Lanka is fully unaware of the carbon market. Several companies involved in mini hydro power generation and Teak foresting have already sold carbon credits.
The ministry has planned to help both private and public sectors to fully exploit the carbon market. We have already established a carbon fund. This fund will assist you in two different ways. Firstly, we will provide you consultancies to identify the carbon credit qualifying projects and to prepare necessary documents. Secondly, we will bundle up your small projects to place in the carbon market. That is because big industries in the developed countries are not interested in looking at small projects. They may need hundreds of such projects to meet their carbon reduction commitment. When our Carbon Fund bundles up your projects, it is one transaction for them.
So dear friends, the Ministry of Environment is not a barrier in achieving your business goals. Instead, we are your environment friend in business. Let's make a joint effort to conserve the environment, since we do it for your own benefit."- Sri Lanka Guardian
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