Info Service on Climate Change (Dec08/04)
as parties fail to agree on expanding sources of Adaptation Fund
15 Dec (Hira Jhamtani) --The discussion on extension of the share of
proceeds arising from the carbon market and joint programs to be used
for financing climate-related adaptation activities collapsed without
agreement during the final part of the Poznan Climate Change Conference,
which ended past midnight on December 14.
extension of the share of proceeds from Joint Implementation and emissions
trading was discussed in the agenda item, “Second Review of the Kyoto
Protocol, pursuant to its Article 9”, under the Meeting of the Parties
to the Kyoto Protocol (CMP 4). Joint implementation, emissions trading
and Clean Development Mechanisms are flexibility mechanisms under the
Kyoto Protocol to help developed (Annex 1) countries meet their obligations
to reduce greenhouse gas (GHGs) emissions.
review of the Kyoto Protocol (KP) is one of the most contentious issues
since before the Bali Conference last year. There was a divergence
of views where developed countries wanted a review of the “architecture”
of KP while most developing countries wanted the review to focus on
the implementation of the Protocol, while maintaining its basic rules
COP 14/CMP 4 in Poznan, following contact group sessions and
informal discussions, a draft decision on this issue was produced on
December 6, 2008. It consisted of five substantive parts: (1) extending
the share of proceeds to assist in meeting the costs of adaptation to
joint implementation and emissions trading; (2) relevant procedural
elements for inscribing commitments for Annex 1 Parties in Annex B to
the Kyoto Protocol; (3) privileges and immunities for individuals serving
on constituted bodies established under the Kyoto Protocol; (4) the
scope, effectiveness and functioning of the flexibility mechanisms,
including ways and means to enhance an equitable regional distribution
of clean development mechanisms projects; (5) the minimization of adverse
effects, including the adverse effects of climate change, effects on
international trade, and social, environmental and economic impacts
on other Parties, especially developing country Parties and in particular
those identified in Article 4.8 and 4.9 of the Convention, taking account
Article 3 of the Convention.
point 1, i.e. the extension of share of proceeds, three options were
provided. Option 1 said that beginning in the second commitment period
(for Annex 1 countries) of the KP, the share of proceeds from emissions
trading and projects under Article 6 of KP (joint implementation) shall
be used to assist developing countries that are particularly vulnerable
to meet the costs of adaptation. To operationalize this, Parties with
a commitment inscribed in Annex B of the KP shall, as soon as possible,
upon issuance of the assigned amount units (AAU) and removal units,
transfer two percent of those units to the appropriate account of the
2 said that the share of the assigned amounts will be auctioned to provide
revenues for developing countries to meet the costs of adaptation. To
operationalize this, each Party with a commitment inscribed in Annex
B shall transfer two percent of the AAU and removal units to the appropriate
account of the Adaptation Fund. Another sub-option (within this Option
2) for operationalization is to issue directly two percent of the AAU
and removal units directly to the Adaptation Fund. In both options the
word “two percent” is in brackets, meaning it was still under discussion.
3 recommended that the issue be taken up under the Ad hoc Working Group
on Long-term Cooperation Action under the Convention in the context
of other possible options for raising funding for adaptation purposes.
further deliberations in informal sessions, another draft was produced
on December 11 in which the options for deciding on the share of proceeds
and its operationalization had been deleted. Instead, the draft merely
agrees that a share of the proceeds from emissions trading and projects
under Article 6 would generate substantial funding for the Adaptation
Fund. It then requests the SBI to recommend concrete proposals to mobilize
such funding and to adopt a decision on this matter at the fifth session
of the CMP. This draft is therefore much weaker than the first, with
no concrete agreed actions for adding to the funding sources to meet
the costs of adaptation particularly in developing countries.
issue of extension of share of proceeds became one of the stumbling
blocks in the negotiation, together with the operationalization of the
Adaptation Fund. The issue of the Adaptation Fund was agreed on at about
9 PM on December 12, and the President of the COP 14 called for a final
plenary session, while the informal group on share of proceeds tried
to reach an agreement.
about 11 pm it was clear that no agreement could be reached on this
agenda item. The President of the COP/CMP then conducted the final
session of the CMP. But he had skipped agenda item 13 on Article 9 and
went on to the next item on the agenda, which was capacity building.
Once the decision on capacity building was passed, China
asked the chair what had happened with agenda item 13 which was second
review of the KP pursuant to its Article 9.
President said that the agenda item on the review of the KP could not
be completed. The issues were taken up at informal consultations but
could not result in an agreement. The CMP 4 then decided that the second
review of the KP is completed.
the informal consultations had continued on even during the COP/CMP
closing session, no draft decision had been circulated to the Parties.
But at the corridors some delegates interpreted the situation to mean
that the second review of the KP is considered completed without results,
and that this issue will not be continued in CMP 5 next year in Copenhagen.
the plenary session, several developing countries expressed their regret
that there could be no agreement on issue of extension of share of proceeds,
which thus prevented an expansion of income to the Adaptation Fund.
Colombia said it must express that
it feels deeply frustrated. It regretted that the COP had not been able
to hear from the victims of climate change. “We regret that the pain
cannot be expressed” the Colombian delegation said. It emphasized that
it is not asking too much. The only source of financing for adaptation
at this point is the two percent proceeds from CDM projects in developing
countries….Here we talk about solidarity, emergency and greater equity.
But the scenarios for mechanisms about more equity have been rejected.
We regret the bad news and the bad signal”. Colombia
hoped that what has happened will serve as an inspiration for reflection
in Copenhagen. It hoped that
the voice of those affected by problems of climate change that they
did not cause will be heard in Copenhagen.
And it hoped that there will be greater harmony between speeches, documents
and promises with the real action on the ground.
Belarus said it is also very
disappointed. “Our colleague from Colombia
has made a stirring statement” it said. Belarus reminded that a lot amount
of work has been done on the issue and it cannot be left hanging in
the air. Agreement had been reached on parts of the draft conclusion.
With so many points on procedural elements agreed, it shows that the
KP procedures and approaches are out of date and need to be changed.
“It is high time we do this” Belarus
observers at the CMP noted that this was an indication that Annex 1
countries wanted to change procedures of the KP that would oblige developing
countries to cut GHG emission but are not willing to make commitments
that would provide more funding for adaptation.]
Africa expressed agreement with the strong
sentiments of Colombia.
It had thought that the outcome could at least be a recommendation to
do further work and then to make a decision at COP 15 next year. “We
now have an Adaptation Fund but no funds”, it said. The only source
of funding for adaptation is currently part of the proceeds from the
CDM. Thus developing country adaptation is funded by developing countries.
further said that we are on the road to Copenhagen, and talking
and trying to build trust, with broader discussions on financial mechanism
and technology transfer. “But we cannot see a strong signal that this
will be agreed on. We need positive signals”. A good outcome would be
to agree to identify new, additional and reliable source of funding
to be provided to the Adaptation Fund.
Costa Rica said this
agenda item has failed on the issue of the extension of share of proceeds.
We have discussed the problems for two weeks in the wonderful city of
However, given the content of the issue, it should be discussed in one
of the most vulnerable countries, in a country that faces the problem
of adaptation every day. Costa Rica added that we talk so much
about adaptation, that the word has almost lost its meaning. But the
reality is that families lose homes, farmers lose water supply and children
are becoming orphans due to climate-related disasters. Adaptation is
the human tragedy of climate change. Most developing countries have
been forced to do adaptation activities in silence and continue to bear
the financial burden of adaptation. The cost of adaptation is not about
compromised texts and strategies, it is about human lives.
Brazil echoed the disappointments
of many countries on the failure to reach an agreement on the expansion
of share of proceeds. This gives a negative signal to Copenhagen,
it said. Brazil
called on all Parties, especially Annex 1 Parties, to move forward in
a way that allows for the operationalization of adaptation through agreement
on concrete actions.
India said that regretfully
Parties have to conclude that the second review of the KP has been completed
without meaningful results. It hopes that this will send a clear signal
about the need for results. The Indian delegate said he has attended
12 COPs and this is the saddest moment he has witnessed. He emphasized
that the discussions on Article 9 fell apart for only one reason – the
refusal of some Parties to lose miniscule income from trading carbon
while millions of people are losing their homes, livelihoods and life
due to climate change.
India asked: What are developing
countries asking for? That in facing this tragedy the world provides
some measure or relief. This is not something unique. Right from the
time when the CDM was conceptualised and agreed on, developing countries
agreed to set aside some share of the proceeds to provide resources
for countries facing adaptation problems. And it is being done. This
is the only source of funding for adaptation now. What do we hear from
some Parties? That they cannot agree to part with some small amount
of funds until we can agree on the overall architecture of the instrument.
We can see clearly what lies ahead at Copenhagen, India
Gabon said that heads of delegation
at the opening ceremony had used grave words about the seriousness of
climate change and uttered promises to shape actions. But the outcome
is a disappointment. Climate change is not a question of finance, it
is not about carbon. It is about humans, the future of our children.
Unfortunately for far too long these cries have not been heard. There
is a great vision gap and that is not a good sign for the future. We
need solidarity if we are to build a new world order. If we have got
the financing mechanism wrong, we should not be afraid to put the issue
back on the table and make it work again.
said that without addressing adaptation funding, it would be difficult
to visualize the road to Copenhagen. Maldives said that in
the small meeting room, what we heard indicated that our partners were
willing to give the wrong signal. Adaptation is a matter of real urgency
for us, and we have been calling parties to address this as an urgent
and immediate need. We have submitted 38 National Adaptation Plans of
Action (NAPAs) and in Marrakech we agreed to implement actions on the
ground for adaptation. Today, we are still talking about it.
the meeting room, delegates from developing countries could also be
heard expressing their disappointment and frustration. One of them said
that the collapse of the talks on this topic is an indication of what
lies ahead in Copenhagen.
Several delegates felt that the developed countries want to change the
rules of the KP so as to oblige developing countries to make more commitments
to reduce emissions. But when developing countries want procedures to
be changed to facilitate funding for adaptation, the developed countries
refused the requests. “Developed countries have said they are willing
to take the leadership in combating climate change, but the collapse
of talks on this agenda item shows, that the commitments do not match
the rhetoric for public consumption,” said a frustrated diplomat.
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