Climate Change Takes Center Stage At Copenhagen
At the same time, policymakers are searching for new sources of sustainable growth to recover from the deepest economic crisis for decades and, in many cases, also the means to cope with severe fiscal pressures exacerbated by the crisis.
The crisis has had major effects on the global economy, but these detract little from the urgent need to combat climate change. The International Energy Agency (IEA) forecasts that declining economic activies could lead to global greenhouse gas (GHG) emissions falling by more than 2.5 percent in 2009 (having increased rapidly in recent years). But the damage from climate change-predicted by the Stern Review, for example, to be highly significant in the future, particularly in developing countries-arises not from the flow of GHGs but from the accumulated stock. And the sheer scale existing stock, and its very slow decay, mean that even quite large reductions in emissions can make little dent on it.
IMF Managing Director Dominique Strauss Kahn has said that the global economic crisis must not distract us from tackling the important issue of climate change. "Sustaining the recovery and putting in place effective climate change policies can be mutually reinforcing with the right policies implemented resolutely," he said. "Global cooperation, including among IFIs, will help countries to confront the challenges from climate change. These require innovative and long-term solutions, which have a part to play in supporting the recovery and sustainable growth. The IMF can assist in its areas of expertise to advise on policies and support countries that are most vulnerable to economic and climate challenges," Strauss-Kahn noted.
Fundamentally, the market failures underlying the climate problem-above all, that polluters do not bear the full costs of emissions-are unaffected by the downturn.
Current mitigation efforts are now generally acknowledged to be inadequate for meeting the economic, social and political problems climate change can create: even accounting for the effects of the crisis global emissions could rise by 40 percent against current levels by 2030, without further policy intervention. Broader and deeper international measures to raise the cost to firms and households of emitting greenhouse gases therefore remains a key priority in the coming years.
However, political focus on restoring economic prosperity could weaken the...
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