Michael Walch

Negotiating Climate

Posted in Rates of Exchange: Amazon Studio by michaelwalch on 24 January, 2010

Brazil’s natural climate and resources are one of its biggest assets. Protecting them is in Brazil’s interest, but so is exploiting them. The international community faces this same conflict – wanting both the exports of the forest as well as (often as an abstract idea) wishing for its preservation. The environmental and economic importance of the Amazon have been a pivotal part of the international discussion on climate change and environmental protection, global economic development, and social equity among nations. Brazil’s climate and soils create tremendous opportunities and liabilities for the country. Brazil’s most fertile areas called terra roxa (red earth) in Parana and Sao Paulo, and least fertile are the Amazon and rainforest. The Northeast areas of the country are often fertile but lack rain. Brazil’s tropical soils produce 70 million tons of grain crops per year, but this is attributable more to extension than fertility.

The rainforest often logged for valuable trees – because of heterogeneity of forest, this requires large area of disruption to find rare species. Recently diversification and plywood/engineered wood products improve the efficiency of logging, allow for economic use of more than 100 tree species.
Generally, Brazil is populated densely along the Atlantic coast, but booming monoculture agriculture and livestock grazing has contributed to the expansion inland, and into the rainforest. Livestock pasture, for instance, is the current use of 70% of formerly forested land in the Amazon, and 91% of deforested land since 1970. The forest-clearing process has innate negative health and environmental impacts, but is often part of land speculation – the cleared land can be sold for a profit. This is another way of saying that, in the short term, the land is more valuable deforested than forested. Unfortunately this value is quickly lost because without the ecosystem of the forest to replenish it, the soil loses its fertility within about 5 years.

In June 1992, Rio de Janeiro was host to the United Nations Conference on Environment and Development (UNCED or more popularly known as the “Earth Summit”) from which the United Nations Framework Convention on Climate Change (UNFCCC / FCCC) was born. This established a non-binding framework to address international climate change and an annual Conference of the Parties meeting.
These guidelines were developed:

  • Annex I countries are industrialized/developed. Within these, the Annex II countries pay for costs of developing countries’ emissions.
  • Annex I & II countries must reduce their emissions from 1990 levels, or buy offsets (including from Developing countries)
  • Developing countries (all others) are not required to reduce emissions, and can sell emissions credits to Annex II countries.

…and thus the solution to the problem of climate change and economic inequality was to – pick your word – monetize, buy, sell, or offset pollution.

The next major development was the Kyoto Protocol of Dec 1997 at the third Conference of the Parties. Most industrialized and some transitional central European countries agreed to binding reduction in emissions to 6-8% below 1990 levels between 2008-2012. The United States initially agreed, but President Clinton never sent the treaty to congress, and George W. Bush rejected it in 2001. Since then, the United States sent delegates to the COP meetings each year, but only as observers.
Negotiations continued without US involvement, and in 2001 at COP 6 in Bonn, Germany, the limits, enforcement, and non-compliance penalties were agreed upon.

  • There is no limit to the offsets that Annex B (Annex II under the UNFCCC) could by from developing countries.
  • Credit would be given for activities which broadly defined absorb/store carbon – including forest management (with caps for each country), cropland management (with limits).
  • The penalty for non-compliance would be to “make up” shortfalls at a rate of 1.3 tons to 1. Funds were established for Annex B countries to support emissions reduction in developing economies.

The Kyoto Protocol entered into force without US agreement at the COP 11 / MOP 1 (Meeting of the Parties) meeting in Montreal Canada in 2005. The goals for the original Kyoto Protocol were set for the years 2008-2012, and the focus of the MOP meetings going forward has largely been on extending the Kyoto Protocol beyond that timeframe. In the meantime, it is interesting to note the variety of successes and failures of countries in achieving their benchmarks. The extensive Wikipedia article on the topic has a great interactive table where you can sort countries by various categories. Here are some highlights:

Country Change in greenhouse gas emissions (1992-2008) 2008 Per-capita CO2 emissions (metric tonnes per person) Share of worldwide
CO2 emissions
China +166.5%* 5.3 22.2%*
Brazil +84.1% 2.1 1.3%
USA +16.8% 18.6* 17.8%

* highest in category

So it is clear that one bi-product of Chinese and Brazilian economic gains is increased carbon emissions, but Brazil is achieving its growth (much less than China of course) with significantly lower per capita and worldwide share of carbon emissions.