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Beijing Cool On Warming Deal

Updated on Mar 20, 2008 – SCMP

In his own way, Theodore Roosevelt, the 26th president of the United States, was deeply concerned about the environment.

Granted, if he were around today his enthusiasm for big game hunting would certainly disqualify him as a conservationist. On safari in East Africa in 1909, Roosevelt and his party shot hundreds of animals from antelopes to rhinoceroses, hippopotami and elephants, shipping tonnes of trophies back to the US.

But on the other hand, while in office Roosevelt did more than any previous president to preserve America’s natural environment. During his two terms in the White House he created 150 national forests, 51 federal bird reservations, 18 national monuments, five national parks and four national game preserves. Altogether he protected some 230 million acres of wilderness territory. That is almost one million square km, or roughly 1,000 times the total land area of Hong Kong.

It is a legacy the president’s great-grandson is keen to advance. In addition to his day job as a managing director of the investment bank Lehman Brothers, Theodore Roosevelt IV is chairman of the Pew Centre for Global Climate Change, a trustee of the Alliance for Climate Protection, and a councillor of the China-US Center for Sustainable Development.

Yesterday, Mr Roosevelt was in Hong Kong with his Lehman colleague, the economist John Llewellyn, to talk about the wealth of business opportunities they believe will be created when China strikes a deal with other world governments, led by the US, to tackle climate change.

Theirs is an extremely optimistic view of the future.

They are correct to say that to be successful, any agreement on climate change must include China. As the first chart below shows, in recent years China’s emissions of greenhouse gases have soared, very likely overtaking US emissions last year. As a result, any agreement which does not limit Chinese emissions will be doomed to failure.

They are also right that an effective deal would generate enormous business opportunities. China’s dismal failure to tackle its domestic pollution problem demonstrates that a regulatory approach to limiting greenhouse gas emissions is unlikely to work. On the other hand, a market-based system that creates an economic incentive to reduce emissions by putting a price on carbon dioxide could well be successful.

And if such a deal were struck many of the opportunities would be in China. As the second chart shows, China is a very carbon-intensive economy, producing far more greenhouse gases per unit of output than developed countries. That means China offers the greatest scope for cost-effective reductions.

Unfortunately, there is little evidence either that China is prepared to sign up to such a deal, or that Beijing is willing to pursue the domestic regulatory culture of transparency and public accountability necessary to make it work.

Mr Roosevelt argues there is a greater than 75 per cent chance that a global agreement on climate change can be struck in the next few years. If he can help persuade China to sign up, it would be an achievement to match those of his illustrious ancestor. Alas, his chances of success look slight.

Greenhouse Gas Emissions, Carbon Intensity

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