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Climate Change as a Facilitator of Growth in Developing Countries

Introduction 

Climate Change as a Facilitator of Growth in Developing Countries: In the long term, climate change is going to impact virtually every discipline and area of law. As pointed out by the climate-skeptics, the climate on earth is indeed not static but in constant motion, and has changed substantially throughout history. Because these changes occur naturally and cannot be politically or legally regulated, there is some justification in asking what the point is in worrying about climate change, to begin with. 

In this essay, I will reflect on some foundational principles of climate change law, and suggest why climate change – in some ways contrary to common sense – may boost wealth and prosperity in developing countries. To address common (mis)conceptions in the developing part of the world on the green transitioning – the global transformation from a fossil fuel-based to a carbon-neutral society –I will use Professor Samir Shukla article: A short history of a dying planet for the young climate change crusaders from India, as a jumping-off point.[1]

Intergenerational Equity Principle

There has been strong, unambiguous evidence and a wide consensus among climate scientists for years now that the drastic rise in temperatures we see on a global scale today is caused by the rise of greenhouse gas (GHG) emissions from human activities. GHGs trap the heat of the sun and stop it from leaking back into space, creating the so-called greenhouse gas effect, which causes a warming of the climate.

Opposite to some distant future a thousand years away, where humans may inhabit mars, human-induced climate change is going to be felt and seen in the decades to come and will be an issue to us, but likely an even more acute issue to the next generation and the generation after them. The responsibility we have towards future generations is recognized in the intergenerational equity principle, expressly acknowledged in the preamble to the Paris Agreement. The principle stipulates that we have a responsibility and should protect the climate system for the benefit of present and future generations of humankind (UNFCCC Article 3.1). In this way, we can entrust the coming generations sustainable earth without enjoying our current western living standards and privileges on their behalf.

Common but Differentiated Responsibility

A sad paradox about climate change is that countries that historically have contributed very little to the global GHG-emission footprint, such as the least developed countries and small island states vulnerable to climate change, will be, and already are, the countries most affected by it. Mitigation and adaption to climate change in these countries are generally not highly prioritized on the political agendas, as they are naturally more inclined to focus on more apparently pressing issues such as reducing poverty and increasing economic growth. Because climate change, to a large extent, is a result of emissions created by industrialized countries during their industrialization process, it is widely acknowledged that developed countries have a historical responsibility to mitigate the consequences of climate change.

To accommodate the developing country’s special needs, the principle of a common but differentiated responsibility (CBDR) is a foundational pillar in the climate change regime. The CBDR is based on developing countries’ historical responsibility along with the polluters pay principle or also called the beneficiaries pay principle, meaning that the polluting countries should bear the cost of corrective actions to mitigate and adapt to climate change. Another way of justifying the CBDR is that the strongest shoulders should carry the heaviest burden, which in this context means that countries that are better equipped to take climate action should have a larger responsibility. 

As a part of the CBDR, it is established in the climate change treaties that the developed countries have an obligation to support developing countries in their climate efforts. In the Paris Agreement, the developed countries have an obligation to provide financial resources to developing countries in Article 9, to carry out technology transfers of clean energy technologies and adaption technologies(technologies to adapt to the consequences of climate change) in Article 10, and help to build up local capacities in Article 11. 

Developing Countries Are Now the Major Polluters

CBDR was originally established in the United Nations Framework Convention on Climate Change (UNFCCC) (1992), which makes a sharp distinction between the developed country’s and developing countries’ climate obligations.

Since the UNFCCC was adopted in 1992, the balance in the distribution of the world’s GHG-emission footprint has undergone profound changes, The carbon-based model that developed countries such as the US, EU countries, Japan, Australia, and South Korea have used to grow their economies, have since been used by emerging economies (developing countries in the process of becoming developed) such as China, Russia, Brazil, and India. In contemporary times, China is by far the largest emitter of C02, surpassing the US (the second-largest emitter) with nearly twice its global emission share.[2] India is now the third-largest emitter, and Russia is the fourth while developing countries such as Iran and Saudi Arabia also have entered the top ten list of global emitters.[3]

It is a common viewpoint in developing countries that the developed countries should carry the full burden of mitigating climate change based on their historical responsibility. To illustrate this common viewpoint I have taken the liberty of using excerpts from professor Samir Shukla’s article: A short history of a dying planet for the young climate change crusaders from India[4] to dive further into the discussion.

Climate Change as a Global Issue

“Dear crusader,

You may have been told that climate change is a wicked problem, and the world will need collective effort to close it from multiple ends.

It is truth but half-truth because the word “world” is confusing. It is an illusion.

There are multiple worlds here, and in the one we live in, there are half a billion kids of your age or younger, and other than the few like you who are on social media going gaga over Greta, almost all of them live a lifestyle that would be worse than your climate change nightmare. So, you may have to wait for climate change, they are already suffering, and there is a reason for it that you need to understand.”

The multiple worlds that Shukla points to correspond with the reasoning behind the long-established principle of CBDR. Because of different national circumstances, historical responsibilities, and different national levels of GHG emissions, the responsibility to take climate action should be allocated accordingly. Although all major countries in the current climate change regime are committed to taking positive actions towards the environment, the responsibility to mitigate climate change is not distributed equally. A country like India, where large regions are marked by poverty, is not expected to contribute as much to the global green transitioning as the developed countries are. The developed countries with established carbon economies furthermore have a responsibility under the aforementioned Article 9, 10, and 11 in the Paris Agreement to assist and provide financial and technical support to developing countries’ climate efforts.

“As I wrote two pieces about Greta and poverty during this week, I have realized that your education has somehow made you feel that climate change is a global problem of priority that must be solved by all, while Indian poverty is basically because we are stupid people and hence we need to solve it on our own.

The truth is, if we try to remove poverty just the way the west did, we will need massive industrialization and that would obviously cause environmental problems that the west doesn’t want.

So we now have the proverbial western cat that has killed a hundred mouse preaching us about how bad it is to kill even one for our benefit.”

Shukla blames the western civilization (or in my terminology: developed countries) for being hypocritical because they tell a developing country like India that burning fossil fuels is bad, although the developed countries have used the exact same carbon-based strategy to grow their own economies. On one level, it seems like the developing countries practice double standards. What professor Shukla fails to take into account is that climate change, no matter who’s a fault it is, remains to be a global issue. This is also acknowledged in the preamble to the Paris Agreement that refers to climate change as a common concern of humankind. The effects of climate change are even going to affect developing countries more severely because they generally lack the technology and the policy instruments to respond effectively.

Exempting developing countries from climate obligations

“While you are adulating Greta, you have lost sight of the problems of your own people who live just two-hour drive from any Indian café where you are drinking 100 rupees coffee and using free internet.

I suggest that you should worry about the poverty of your own brothers and sisters first and leave the climate change to the west.”

The idea of exempting developing countries from any climate obligations was tried out in the climate change regime’s early years. Article 4.7 of the UNFCCC states:

The extent to which developing country Parties will effectively implement their commitments under the Convention will depend on the effective implementation by developed country Parties of their commitments under the Convention related to financial resources and transfer of technology and will take fully into account that economic and social development and poverty eradication are the first and overriding priorities of the developing country Parties.”

In the UNFCCC (1992), the developed countries are the industrialized countries listed in Annex II (mostly OECD-countries and the European Economic Community). The BRIC countries (Brazil, Russia, India, and China) are considered to be emerging economies, and not included on the list of Annex II countries with enhanced climate obligations compared to Annex I and non-Annex countries.

Article 4.7 effectively makes the developing countries’ climate obligations conditioned on adequate technology transfer and funding from the developed countries. In the past, developing countries have argued that the developed countries have not lived up to this responsibility, and as a result, they have refused to reduce their GHG emissions (see Bali Roadmap Decision 1/CP13 in UNFCCC (2007). 

In the Kyoto Protocol (1997), which is the predecessor agreement to the Paris Agreement, the least developed countries were exempted from formulating any GHG-emission reduction targets. This exemption was controversial and extended the negotiating process of the Kyoto Protocol for years. Notably, the US adopted the Byrd-Hagel Resolution, which stated that the Senate would refuse to approve of any climate agreement which did not place future emission reduction commitments on the developing countries.[5]  The US Senate stated that the lack of commitment on the part of the developing countries, would harm the US domestic economy and give its competitors, such as China, an unfair economic advantage.[6] On this background, the US is not a signatory party of the Kyoto Protocol.

Although the CBDR has been maintained in the Paris Agreement (see Article 2.2), the distinction between Annex and Non-Annex countries from the UNFCCC is now history. The sharp distinction can no longer be justified, first and foremost, because developing countries are now among the major polluters, and also when considering the urgent pace in which the global green transitioning needs to happen to preserve the earth’s eco-system.    

Instead of the Annex/Non-Annex Country commitment system, the Paris Agreement uses nationally determined contributions (NDCs), pursuant to the Paris Agreement Article 3. The NDCs are written statements that reflect each country’s highest possible ambition. They are envisioned to be progressively ambitious after each one is met.

Article 4 (4) and (5) of the Paris Agreement clarifies in the context of NDCs that the “developed countries parties should continue taking the lead by undertaking economy-wide absolute emission reduction targets,” and they shall provide support to developing countries recognizing that enhanced support for developing country Parties will allow for higher ambition in their actions.”.

In this way, developed countries continue to take the lead; however, to exempt developing countries from any climate responsibility is not a durable solution. It would weaken and delay the green transitioning, and the US, as the second-largest polluter, would not approve of such an initiative.

Climate Funding

“They have all the money in the world that they have stolen while burning the planet. If they are really worried, they can easily pay to have all power production of India and China to economically unviable solar or wind power plants.”

In two-thirds of the world, renewable energy is now cheaper than fossil fuel-based energy, and solar and wind energy may not be a long way from becoming a standard power source.[7]

Developed country members of the Paris Agreement have committed to providing public and private funding and wealth transfers of USD 100 billion per year, beginning in 2020 and lasting at least until 2025 to support mitigation and adaptation measures in developing countries.[8]  Analysis suggests that the agreed level of funding is low, as the needs of developing countries for mitigation and adaptation may be in the range of USD 600 to USD 1,500 billion a year.[9] In 2017 the total level of climate funding from developed to developing countries only amounted to USD 56.7 billion in 2017.[10]

As the numbers show, there will be a huge financial gap between the intended level of climate funding compared to the level of funding that is actually required. In the end, the developed countries may not have any other option, but to scale up their climate efforts as a global temperature increase of two degrees Celsius could be associated with global GDP per capita losses of as much as 35 percent in 2100.[11] In this way, the developed countries will end paying for a large part of the power production and also the adaption efforts in developing countries by direct funding. Furthermore, private firms and public entities in developed countries are committed to transfers technologies and share know-how under the Paris Agreement.

Technology and funding 

“If they are worried, they can easily share their cutting-edge agriculture technologies with the poor nations free of cost.”

It is true that fully government-owned technologies can be transferred to developing countries free of cost. However, cutting-edge technologies are rarely found in the public domain. Cutting-edge technologies are either found in the internal research & development laps of private companies or out on the market where the technologies are subject to patents and have other intellectual property rights attached to them as well. Besides cutting-edge technologies, private companies have large financial resources at their disposal and possess important industry expertise and know-how that the public sector does not have. Engagement of the private sector is thus critical to building up capacity and sound technology bases in developing countries and in closing the funding gap with private investments in climate-related projects.  Climate Change as a Facilitator of Growth in Developing Countries.

While public climate action can be taken “free of cost” based on the goodwill of national taxpayers, private climate actions are always driven by profit-maximizing. Because the private market is not driven by social benefits, but by market demands, a prosperous investment climate needs to be present in the developing country to attract foreign investments. In terms of climate-friendly technologies, the country needs to strengthen its absorptive capacities, which refers to the countries’ ability to take in and imitate new technologies. Otherwise, the country is only littered with useless, rusting “environmentally friendly” hardware.[12]  

The commitment under the Paris Agreement for developed countries to assist developing countries in their climate efforts, thus have a broader reach than mere climate funding and transfer of climate-friendly technologies. Climate change calls for an overall strengthening of developing countries’ financial resources, technical capabilities, policies, infrastructure, technical and human capital, and market conditions with the aim of attracting foreign investments and absorb the new technologies. In this perspective, the goal of poverty removable does not necessarily have to be separate from the goal of green transformation in developing countries. The commitment of developed countries to provide public and private resources in the climate change regime may be naturally be aligned with the humanitarian task of promoting welfare in developing countries. Climate Change as a Facilitator of Growth in Developing Countries.

Tying it all together

“If we have a role to play in saving the planet, it is first of poverty removal, as it is tangible suffering of a billion people, and thus it must be addressed first.

If people will live under the survival threat that almost half a billion Indians are. They can’t be forced to play by your rules. So, if you want the real world to join your crusade against a future threat. You need to focus on their current problem.”

Climate change is a politically heated topic that tends to bring up strong emotions in people. On one end of the spectrum, Greta Thunberg and her sympathizers warn us about the apocalyptic consequences. We are all faced with if we do not change our current ways of functioning in the world. On the other end of the spectrum, we have authors such as Professor Samir Shukla who believe that developing countries should be allowed to continue large-scale fossil-fuel-burning with the aim of achieving economic welfare, while the western countries should carry the full burden of climate change mitigation. Climate Change as a Facilitator of Growth in Developing Countries.

As with the other challenges in life, the optimal approach to climate change will most likely be the happy medium between two extremes. Inevitably, the shift away from fossil-fuel energy sources will be gradual. As it will take time for the global economy to adjust to a new renewable energy-based model. Vast financial resources need to be collected, new jobs need to be created. And a new understanding among energy consumers needs to emerge. This process will require time and a gradual out-phasing of gas, coal, and crude oil. Too abrupt a shift in energy generation would harm the economy. And would furthermore not be realistic from a political point of view.   

The process of mitigating and climate change is a common concern of humankind and a global issue, no matter who is to blame for it. To exempt developing countries from climate responsibility is not a durable option in the present age considering the global distribution of GHG emissions. And the urgency of responding to climate change. However, as I have argued in this essay, climate change may be turn out to be a facilitator of growth in developing countries. Instead of an obstacle to poverty removal, and should be viewed in that light. 


[1] https://timesofindia.indiatimes.com/blogs/science-nomad/a-short-history-of-a-dying-planet-for-the-young-climate-change-crusaders-from-india/

[2] https://www.forbes.com/sites/rrapier/2019/12/04/the-worlds-top-10-carbon-dioxide-emitters/#36abc732d04b (opened 13-05-2020)

[3] Ibid.

[4] https://timesofindia.indiatimes.com/blogs/science-nomad/a-short-history-of-a-dying-planet-for-the-young-climate-change-crusaders-from-india/

[5] Sanford E. Gaines, International law and institutions for climate change, Research Handbook on Intellectual Property and Climate Change, Paperback edition 2018, pg. 43.

[6] Simone Schiele, Evolution of International Environmental Regimes: The Case of Climate Change International Climate Regime, 2014

[7] https://www.altenergymag.com/article/2020/05/how-solar-and-wind-energy-are-now-cheaper-than-fossil-fuels/33132 (opened 06-06-2020)

[8] FCCC/CP/2015/10/Add.1, p. 114.

[9] Meena Raman (2012), Trillions needed for climate finance, UNFCCC workshop told. And Published in SUNS #7408 dated 11 July 2012, Third World Network TWN Info Service on Finance and Development.

[10] http://www.oecd.org/newsroom/public-climate-finance-to-developing-countries-is-rising.htm (opened 17-04-2020).

[11] Climate Investment Funds c/o The World Bank Group (2016). Private Sector Investment in Climate Adaptation in Developing Countries: Landscape, Lessons Learned and Future Opportunities, pg. 11.

[12] International Energy Agency (2001), Technology Without Borders – Case Studies of Successful Technology Transfer, pg. 17. 

Environmentally sound technologies climate change paris agreement intellectual property rights trips patents developing countries. Climate Change as a Facilitator of Growth in Developing Countries.

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