Climate conflict: no money-no change

By Terry Lacey

(September 30, Jakarta, Sri Lanka Guardian) The Bangkok Climate Change talks involved 1,500 delegates. There seems to be no problem paying for all these people to troop around the world talking about climate change. From New York to Bangkok, from Barcelona to Copenhagen.

But nobody yet seems to want to actually pay enough to make it work.

In the past the more countries developed and grew the more their emissions of greenhouse gases (GHG). But Southern countries don’t see why they should agree to costly technologies and tougher emissions targets, unless the West helps pay for it.

After all the West is still clinging to majority shares and just over half the votes in the World Bank and IMF, based on global economic domination built up using dirtier previous energy technologies , but now expects Asia and Southern countries to cripple themselves with higher costs and ambitious emissions targets and then buy Western clean technologies as well.

Why should the countries of Asia and the South agree to this double whammy of undermining their own industrial competitiveness with the controls the West didn’t quite manage for itself, while backing a Western clean technology export drive ?

China and Southern countries like Brazil and Indonesia are willing to greatly expand the use of renewable energy and energy efficiency and cut emissions, but this is easier said than done and requires a big increase in technical capacity as well as access to technology and finance.

The G20 summit in Pittsburgh also promised the phasing out of subsidies on fossil fuel, which holds back renewable energy and energy efficiency.

The rapid expansion of renewable energy and energy efficiency and phased termination of subsidies on fossil fuel and electricity both depend on public administration reform, re-targeting of social subsidies, improved capacity to manage massive inward investment into clean energy and adaptation of regulatory frameworks, especially to facilitate public-private sector partnerships.

In all these areas ASEAN and Asian governments make clear that the spirit is willing but the capacity is weak, and needs rapid strengthening.

Fitrian Ardiansyah, of the World Wildlife Fund (WWF), writes in The Jakarta Post (29.09.09) that if the world is to move $1.3 trillion per year in private sector annual investment to Southern economies, as advised by the International Energy Agency (IEA), then pump-priming technical assistance and technology transfer financing is essential.

China has said it wants to see the equivalent of up to an additional one per cent of GDP flows on top of existing Official Development Assistance (ODA) to pull the Southern countries onto a faster track towards clean energy economies.

But this could mean doubling world ODA, which does not seem so likely straight after the biggest Western bank crash and recession since the 1930´s.

The best solution seems to be a combination of targeted technical assistance to promote clean energy and energy efficiency technologies, support for manufacturing the equipment in Asia via joint ventures, better targeting of export credits, some encouragement for Western and Southern state and commercial banks and strengthening of carbon-credit markets, backed by levies on aviation and shipping.

And the money has to be relatively easy for projects to get at, not wrapped up in excessive bureaucracy and complex trust funds. Real money you can feel, not recycling the same old Rose in second hand clothes.

And if we cant get this moving promptly in up-and-coming Asia then it won´t work either in Africa and Latin America. So how is it really going to work and when do we start ?

Terry Lacey is a development economist who writes from Jakarta on modernization in the Muslim world, investment and trade relations with the EU and Islamic banking.

-Sri Lanka Guardian