Warsaw Climate Change Conference - November 2013

The Warsaw Climate Change Conference officially opened on 11 November. ...
Korolec, Minister of the Environment of Poland

It is clear that there are high hopes for the UN conference Cop 19 in Warsaw this November. The question facing many onlookers is will this conference turn into just another talking shop. Past climate change talks from Rio onwards, have been hailed as successes, even though they have produced little in the way of visible results. From a climate change point of view, Oxford Economics Professor Dieter Helm regards the past three decades up to 2020 as a ‘waste of time’. Many of the same argument s have been in play, including complaints about the lack of western ambition to cut emissions and aid adaption in the third world, the cost of climate change and the price tag for taking action.

Developing world wants more money.

 

Many emerging countries have made known their disquiet at the lack of ambition of rich nations to aid poor countries in adapting to climate change. The concern, no one is sure how much aid is necessary. The UNFCCC expected that by 2030 deprived nations would require between $28 billion and $59 billion a year to adapt. However, the World Bank recommended between $20 billion and $100 billion; the European Union Commission advocated between $10 billion and $24 billion a year by 2020. Nevertheless, despite climate aid growing, a recent World Bank report suggested it only met 5% of current requirements. http://unfccc.int/meetings/warsaw_nov_2013/meeting/7649.php

Nevertheless, providing more cash is not without its problems for developed countries. Due to the world recession, many advanced economies do not have the spare resources available to meet third world countries requirements. In addition, “many developing countries have poor track records in using external assistance funds in transparent, efficient and non-corrupt ways," commented a 2012 paper, Financing Urgent Adaptation by the Geneva-based Global Humanitarian Forum, a non-profit foundation.

As for lack of motivation in cutting emissions, for many rich economies, making adjustments is, a difficult and complex task during a period of economic recession for many rich economies. Part of the problem that developed countries like Britain face is that of inertia, once you have built a coal power station, it is very difficult to close such facility down early, before the end of its operational lifespan. In addition, new energy generating technology often takes at least 50 years before it becomes economically viable.

Cost of climate change

Approximating the cost of climate change is a difficult and complex undertaking, and the assumptions the underlying figures are based are open to interpretation and subsequent dispute. However, according to a study by a European-based NGO called DARA 12^th of September 2012, current failures to act on climate change are damaging global economic growth. DARA puts the cost of climate change at some 1.6% of global GDP, this amount to approximately $1.2 trillion in foregone prosperity per annum. Unless action is taken, it is forecast that the economic damage climate change will have on the global economy could increase to 3.2% of world GDP by 2030. In terms that are, more specific climate change is costing both China and the United States over 2% each of their individual potential GDP and India 5% of its GDP. EU Climate Commissioner Connie Hedegaard has said, “Climate change is not a distant threat, but a present danger!”

In 2012, the major weather disasters, including floods, droughts, hurricanes and tornadoes cost the United States over US$110 billion, according to the US National Climate Data Centre. During 2012, this meant a typical major weather disaster was costing the American economy over $1 billion. This compares with the period between 2000 and 2011, when the average yearly cost of such disasters was around US$27 billion. Transport costs using barges have increased by 22% because of draughts affecting US navigable waterways.

Cost of taking action

Determining whether taking action on climate change is viable will depend in part, on how you view the value of currency over time. In other words, what discount rate will you use in your calculations. Bangladesh Prime Minister Sheikh Hasina Wajed said.  For instance, if you use a discount rate of just 1% €1000 today is worth €368 in 100 years’ time, whilst making use of a 4% discount rate with me that the same €1000 today would be worth just €18 in 100 years. So as Bangladesh Prime Minister Sheikh Hasina Wajed said, “What is possible with $100 billion today will cost ten times more in 2030,” reports Bloomberg 13 February 2013.       

The United Kingdom Parliament Committee on Climate Change report in 2012, known as “statutory advice on inclusion of aviation and shipping,” reported that by 2050, UK emission reductions would cost up to 2% of UK GDP. At present, UK climate policies currently cost 1% of UK GDP. This is the equivalent to the UK’s budget on new social housing and community amenities. In 2010, the British government spent nearly 10% of the U.K.’s GDP on the National Health Service reports the Guardian newspaper second of May 2012.

On a world scale, according to Nicholas Stern, the British economist, author of the 2006 Stern Review on the Economics of Climate Change, he projected that preventing climate change would cost the world economy, the equivalent of just 2% of global GDP per annum. Gross World Product was $69.99 trillion in 2011.

Conclusion

It is clear that Cop 19 is part of the World’s on-going debate to tackle climate change.