The real Lima deal

Financial Mirror (Cyprus) - - FRONT PAGE -

It was the agree­ment that ev­ery­one wanted, yet that no one much likes. This year’s an­nual United Na­tions cli­mate-change con­fer­ence in Lima, Peru, con­cluded last week after fierce ar­gu­ment in the fi­nal days. Ne­go­tia­tors from 196 coun­tries patched to­gether a com­pro­mise that keeps the world on course to a new global cli­mate agree­ment in Paris next year; but almost ev­ery­one was left un­happy with some pro­vi­sion or another.

Many crit­ics of the deal, how­ever, have missed the point. The Lima deal is weak in many re­spects. But it also rep­re­sents a fun­da­men­tal break­through for shap­ing a com­pre­hen­sive global cli­mate regime.

The Lima con­fer­ence had two goals. The first was to adopt an out­line of the text of the 2015 Paris agree­ment. This goal was achieved – but only by cre­at­ing a huge 37-page doc­u­ment con­tain­ing ev­ery pos­si­ble op­tion that coun­tries may want to see in next year’s deal. Del­e­gates did not at­tempt to ne­go­ti­ate be­tween the var­i­ous op­tions, tak­ing to heart the old maxim “Why do to­day what you can put off un­til to­mor­row?”

That ne­go­ti­a­tion has been left to the five ses­sions of talks sched­uled for 2015, start­ing in Fe­bru­ary. Given the di­ver­gence among the po­si­tions in­cluded in the Lima text, ar­riv­ing at a draft fit for sign­ing in Paris next De­cem­ber will be a huge task. The sec­ond goal was to agree on the terms un­der which coun­tries will de­vise their na­tional com­mit­ments – of­fi­cially, their “in­tended na­tion­ally de­ter­mined con­tri­bu­tions” (INDCs) – in 2015. Here, the com­pro­mises were sharply felt.

De­vel­op­ing coun­tries wanted the INDCs to in­clude plans for adap­ta­tion to cli­mate change as well as emis­sions cuts, and they wanted de­vel­oped coun­tries to in­clude fi­nan­cial support for poorer coun­tries. In­stead, no com­mit­ments to new money were made, and the in­clu­sion of adap­ta­tion plans will be op­tional, not com­pul­sory.

Mean­while, de­vel­oped coun­tries wanted all coun­tries to pro­vide stan­dard­ised in­for­ma­tion on their emis­sions tar­gets and plans, to en­sure trans­parency and com­pa­ra­bil­ity. The key el­e­ments were agreed on, but only in the form of guid­ance, not as re­quire­ments. Like­wise, the pro­posal by the Euro­pean Union and the United States that coun­tries’ plans be sub­ject to some kind of as­sess­ment was dropped from the fi­nal text.

But the ag­gre­gate ef­fect of all coun­tries’ plans will be cal­cu­lated, al­low­ing eval­u­a­tion next year of whether the world has done enough to limit av­er­age global warm­ing to the agreed ceil­ing of 2 de­grees Cel­sius. It almost cer­tainly will have not.

For many of the agree­ment’s crit­ics, par­tic­u­larly those in the en­vi­ron­men­tal move­ment, th­ese com­pro­mises made the Lima deal an ex­ces­sively “bot­tom-up” agree­ment. Coun­tries have too much lat­i­tude to make what­ever com­mit­ments they want, rel­a­tively un­con­strained by a common set of “top-down” rules im­posed by the agree­ment. Such crit­ics worry that this will make it harder to per­suade coun­tries to cut emis­sions fur­ther when it be­comes clear that their col­lec­tive ef­forts are not enough, and that it may even al­low some coun­tries to use ir­reg­u­lar ac­count­ing meth­ods.

But this over­looks the Lima agree­ment’s great­est ac­com­plish­ment: It ends the long­stand­ing di­vi­sion of the world into only two kinds of coun­tries, de­vel­oped and de­vel­op­ing. Ever since the orig­i­nal UN Frame­work Con­ven­tion on Cli­mate Change was signed in 1992, coun­tries’ obli­ga­tions have been de­fined ac­cord­ing to their level of de­vel­op­ment in that year. The rich so-called “An­nex 1” coun­tries have had com­pul­sory obli­ga­tions, while poorer “non-An­nex 1” coun­tries merely have been re­quired to make vol­un­tary ef­forts.

Over the last 22 years, that bi­nary dis­tinc­tion has looked in­creas­ingly ob­so­lete, as the larger de­vel­op­ing coun­tries, such as China and Brazil, have emerged as eco­nomic su­per­pow­ers and ma­jor green­house-gas emit­ters. For this rea­son, the de­vel­oped world has long wanted to re­place the “fire­wall” be­tween the two his­toric group­ings with a form of dif­fer­en­ti­a­tion that bet­ter re­flects the con­tem­po­rary world. But the de­vel­op­ing coun­tries – in­clud­ing ma­jor pow­ers like China – have in­sisted that it re­main.

No longer. The Lima agree­ment

cre­ates obli­ga­tions for coun­tries with­out re­gard for the dis­tinc­tion be­tween An­nex 1 and non-An­nex 1. Rather, it uses a new phrase drawn from the re­cent agree­ment be­tween the US and China: coun­tries’ re­spon­si­bil­i­ties will be based on “common but dif­fer­en­ti­ated re­spon­si­bil­i­ties and re­spec­tive ca­pa­bil­i­ties in light of dif­fer­ent na­tional cir­cum­stances.” The fire­wall has been breached.

In the­ory, the Lima agree­ment on INDCs does not de­ter­mine the shape of the long-term Paris agree­ment. So another fierce bat­tle on this is­sue can be ex­pected next year. But the vast majority of de­vel­op­ing coun­tries – in­clud­ing China and Brazil – are happy with the new regime. So it is im­pos­si­ble to imag­ine the bi­nary model be­ing re­stored – and those coun­tries that op­posed the change know it, which is why the fi­nal two days in Lima were so fiercely fought.

The Lima con­fer­ence has shown just how hard the ne­go­ti­a­tions in Paris next year will be, de­spite re­cent op­ti­mism about global progress. But one highly sig­nif­i­cant decision has now ef­fec­tively been made. Abandoning the rigid dis­tinc­tion be­tween de­vel­oped and de­vel­op­ing coun­tries paves the way to­ward an agree­ment that all coun­tries, in­clud­ing the US and China, can sign.

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