The accord on climate change reached in Copenhagen, while at first sightly minimalist in content, is nonetheless historic and a landmark document in the emerging global economic architecture of the twenty-first century. The event has been dubbed “Nopenhagen” by Hugo Chavez, Venezuela’s president, but this is also a lot of “Yespenhagen” about it. Crafted initially as a bilateral US-China initiative, and then broadened to US, China, India, Brazil and South Africa (the so-called BASIC countries), and subsequently to the EU, Canada and Australia it marks a new form of North-South global economic diplomacy and provides a critical platform onto which new and more concrete climate arrangements can potentially be built later.
A month ago, it seemed that Copenhagen would conclude at the political level with a meeting of country environment ministers. UK Prime Minister Gordon Brown changed that by his decision to come to Copenhagen, which set off a virtual stampede of around 130 heads of state eventually attending. The North-South divisions on climate policy which had been growing pre Copenhagen came to the fore immediately with walk outs and discord. At the eleventh hour a meeting between US President Barack Obama and Chinese Premier Wen Jiabao seems to have provided the catalytic moment from which the agreement came. In the final analysis, for 130 leaders to return to national capitals with no agreement on an issue with such political momentum behind it would have been unacceptable, and so the basis for an agreement was laid.
The Copenhagen Accord effectively rescues for now a negotiating process that looked ill conceived and in deep trouble. It was a negotiation without prior agreement on a clear agenda, made more complicated by a likely backlog of unfulfilled first-round Kyoto commitments and to be guided by vague and ill-specified principles such as Common But Differentiated Responsibilities. Add to this differences of view over whether annual or historical emissions should be the basis for cuts, whether consumption of emissions-producing goods or their production mattered, whether flows of emissions at a point in time relative to a base date or intensity of emissions relative to GDP should be lowered, and the result was an overwhelming slate of major issues that seemed impossible to resolve.
What the Copenhagen Accord does is set all of these issues and more on one side for now. It instead builds on the unilateral commitments that countries had already announced prior to Copenhagen and begins by listing these. These include the US Waxman-Markey commitments to approximately an 18 percent reduction in emissions by 2019, China’s 40-45 percent reduction in emissions intensity by 2020 relative to a 2005 base, the EU’s 20 percent emissions reduction and 20 percent non-renewables commitment by 2020, and others. It commits parties to their implementation, and raises the prospect of some form of international verification. The prospect is then added of developed countries “working towards” a fund of US$ 100 billion/yearly 2020 to aid developing countries.
One can reasonably argue that the unilateral commitment on which the Accord builds is itself vague and imprecise. US provisions involve offset arrangements under which domestic US producers can buy offsetting credits from outside the US, with little by way of authentication and audit. China’s commitments match an approximate 50 percent reduction in intensity of emissions to GDP between 1995 and 2007, and there are issues as to how GDP is measured and whether purchasing power party exchange rates are used. But even with this, it is the verifiability of these commitments which is now the issue.
The Accord talks specifically of countries “listing their national actions and commitments… and to provide information on the implementation of their actions through national communications with provision for international consultations and analysis under clearly defined guidelines,” but studiously avoids more specificity. Verifiability is a central issue in Kyoto itself. Countries inform the United Nations Framework Convention Climate Change (UNFCCC) secretariat of country emissions, and data are discussed with the Secretariat and can be repeatedly modified through this process. But there is no mechanism for making firm determination of what emissions actually are, since no agency has authority under Kyoto to do this.
This would seemingly have to be the starting point to making verifiability in the Copenhagen Accord more concrete. Agreement on an international authority or agency to make determination of emissions will be critical and painful due to the compromises of sovereignty involved. And the powers of such an authority in terms of rights to inspect, collect data and how it would make decisions all need to worked out.
Even after that the issue of penalties for non-compliance remains. There is seemingly nothing in the Accord on tax, but ideas (some radical) circulate. One is for all countries to contribute to a large fund held in escrow by a UN agency. Funds are returned later to those who comply with their commitments. Funds from non-compliers are divided among compliers. Another is to enter the Accord fully into domestic law in all countries and give private parties rights to sue national governments for damages if they fail on their commitments. This is getting ahead of the post-Copenhagen process, but eventually these issues will need confronting.
But as much as anything it is the North-South dimension of the agreement which makes it truly historic. Those versed in global negotiation in other areas would find it hard to conceive of an agreement worked out between the US, China, India and South Africa being presented to the EU, Japan, Brazil and others as largely a done deal. The scope and extent of the global power shift this embodies is of major historic proportions, and more of this form is now likely to follow.
John Whalley is a distinguished fellow at CIGI. This column was first published on alrroya.com.