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A Marshall Plan For Climate Change

Alex Lo – Updated on Jul 10, 2008 – SCMP

During the Group of Eight summit in Hokkaido, Japan, this week, US President George W. Bush warned that no global climate treaty would work without the participation of China and India. He is absolutely right. This is especially the case with the mainland, which by some measures has exceeded the US as the No1 greenhouse gas-emitting nation in the world. But Mr Bush neglects to state that the US, as the world’s most polluting country in history, must make the same commitment.

The problem is how to encourage the two emerging powers to join any post-Kyoto Protocol treaty now being negotiated by more than 190 nations, with 18 months to deadline. India and China have effectively ruled out cutting emissions in any meaningful way before they become fully industrialised. Fuel efficiency and alternative energy sources seem to be completely foreign concepts to their auto industries and car users.

The degree of resistance can be gauged by the angry reactions in India a few months ago when Mr Bush remarked, innocently but accurately, that the rising demand of India’s middle class for better and more nutritious food is pushing up prices. In this, Chinese are also guilty, as are Americans.

Fingers can always be pointed at the US, which has just 5 per cent of the world’s population but consumes a quarter of its energy. Moreover, most of the greenhouse gases causing dangerous climate change in the atmosphere today have been created by the advanced economies when they were industrialising. So, a senior Brazilian minister has likened the situation to emerging economies being invited to dessert after the rich countries have already had their full lunch but are being asked to split the whole bill. This is surely unfair; and unless it is equitably addressed, there is no way to convince developing countries to join the effort.

Speaking at about the same time as Mr Bush, however, Japanese Prime Minister Yasuo Fukuda outlined a solution. The rich nations should offer cash and technology to help emerging economies leapfrog to energy-efficient industrialised status. This would be an unprecedented commitment by the west and Japan, but would also serve historical justice. Japan has the experience in developing the technology since the oil shocks of the 1970s. The US and other G8 nations have the money.

Something on the order of a Marshall Plan to halt climate change is needed. It is a welcome development that the US has overcome its longtime reluctance and joined other G8 nations to back halving greenhouse gas emissions by 2050.

Now, it is in China’s own interest to join any post-Kyoto deal. Far more immediate than global warming, the mainland faces a looming environmental catastrophe. At the moment, its environmental degradation and pollution costs the economy between 8 and 12 per cent of its GDP each year. The country has 16 of the world’s 20 most polluted cities. Millions are dying from pollution. China’s environmental threats can undermine its economic miracle, public health system, social stability and international reputation, according to Elizabeth Economy, an authority on the subject and author of The River Runs Black: The Environmental Challenges to China’s Future.

Since 1978, China has shown its ability to adapt and change in the face of new crises. Its decision to join the World Trade Organisation stemmed partly from its need to open up and impose market discipline on its moribund financial and banking sectors.

The same or similar rationale applies to joining a post-Kyoto treaty. The central government already realises that years of unchecked growth is posing too high a cost on the nation and many of its people. By committing to a climate-treaty discipline, and with subsidies and technology transfer from the rich countries, it is in everyone’s interest to see China – and India – make this leap. Alas, the political will to commit to this approach is sadly lacking in the west and east.

Alex Lo is a senior writer at the Post

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