China: No Money, No Problem!
Todd Stern, the U.S. Special Envoy for Climate Change (pictured right),made clear in a press conference yesterday (Day 3 if you are counting!)in Copenhagen that the war chest for the initial fast track funds beingconsidered now for climate change adaptation for developing countrieswould not be unlimited:
China, with a $2 trillion reserve and a revved-upeconomy, won’t be a recipient. “I don’t envision public funds,certainly not from the United States, going to China,” Stern said.“There’s inevitably a limited amount of money. The amount ought to beas high as it possibly can be, but it’s necessarily going to belimited. That’s just life in the real world.
Financing would instead be prioritized for the most vulnerable andleast developed countries. While a price tag in the neighborhood of$100 billion per year is what the likes of British PM Gordon Brown andUNFCCC General Secretary Yves de Boer are proposing for the long term(some developing countries are seeking as much as $300 to 400 million ayear), there is also an emerging consensus to reach agreement inCopenhagen for fast-start financing of $10 billion for the near term,i.e. 2010 to 2012. U.S. President Obama has already indicatedthat he is on board with this idea, agreeing to “mobilize $10 billion ayear by 2012 to support adaptation and mitigation in developingcountries.”
But Stern frames the constraints of such limited financing in frank terms:
“We would intend to direct our public dollars to theneediest countries, and China to its great credit, has a dynamiceconomy that has led it to sit on trillions of dollars in reserves,” hesaid. “So we don’t think China would be the first candidate for publicfunding.”
While some media outlets would like to play on the image ofgeopolitical drama here by pitting two mighty superpowers against—Eagle versus the Dragon—there is really nothing to Todd Stern’scomments because China is completely on the same page.
Earlier in the year, China and the Group of 77 were at the forefrontof making demands on developed countries to contribute generous sums toaid developing countries’ adaptation and mitigation challenges to thetune of 0.5 to 1 percent of their collective GDP. But yesterday at apress conference, Yu Qingtai, China’s special envoy for climatechange, made clear that China has never thought of itself as a “firstcandidate,” and that their main goal is to guarantee financial backingfor an agreement to actually take effect. Yu’s comments supportstatements by Liu Yuyin, Climate Advisor of the Chinese Mission to theUN, that China is pressing primarily for funding that will supportother developing countries (see previous post “China in Copenhagen Day 3: Tuvalu Raises the Bar, China Reacts“).
One wrinkle to this stance is that China has been very consistent insaying no to subjecting domestic climate actions that are undertakenunilaterally without international technological or financial supportto international reporting and verification procedures. So Chinarealizes that if it is eager to accept international financing, itwould have to start “opening its books.” The negotiations onmeasurement, reporting and verification (MRV) will be an importantissue to watch over the remaining 8 or 9 days in Copenhagen.
While China is a tough negotiator, sticking to its gunswith respect to seeking more ambitious developed country commitmentsand the principle of “common but differentiated responsibilities” (seeprevious post ““China in Copenhagen Day 2: Danish Distraction, Su Wei gets tough on the developed world”),it is also pragmatic and increasingly savvy about its emergence as apivotal power in the international stage. Last month, China pledged byitself $10 billion in general assistance to African nations,part of which would go into developing 100 clean energy projects. While it is now clear that China does not expect to be the firstrecipients of international climate financing, one key questionremains: In light of the governments of UK, Australia, Norway andMexico proposal for a new set of principlesfor a global climate fund, can the discussion of whether China shouldbe a potential recipient of such funds be shifted to whether China canbe a significant contributor? [UPDATE: Not unexpectedly, the answer was No, by Su Wei in a press conference today (Day 4).]
Related reading: Today, famed financier George Soros was in Copenhagen to tout a solution to meeting the $100 billion per year challenge based on a system of “special drawing rights”
Photo credit: Getty Images, via WSJ
This is a re-post of my recent contribution to Climate Progress.
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