Daily report for 3 March 1997

The sixth session of the Ad Hoc Group on the Berlin Mandate (AGBM-6) of the UNFramework Convention on Climate Change opened on Monday, 3 March 1997 in Bonn,Germany. Following opening statements, delegates adjourned the formal session andconvened an informal round table on new proposals from Parties. Parties elaborated ontheir proposals and responded to questions. Delegates also agreed to convene “non-groups” to exchange views and merge different proposals.

OPENING SESSION

AGBM Chair Raúl Estrada-Oyuela (Argentina) noted the considerable number of newproposals and called for long-term sustained efforts from industrialized countries. He saidchanges would be neither easy nor inexpensive, but added that the costs resulting frominaction far outweigh the costs of preventative measures. He welcomed Dan Reifsnyder(US) as rapporteur.

FCCC Executive Secretary Michael Zammit-Cutajar noted that AGBM-6 marks the lastsession prior to the six-month deadline for circulating a draft protocol. The negotiatingtext must “contain the seeds” of the final outcome and there should be no surprises after 1June 1997.

The WORLD COUNCIL OF CHURCHES appealed to delegates to act now and notedthat delayed action will involve even higher demands. He said climate change is an issueof global justice and called on AGBM to promote lifestyle changes in developedcountries.

The secretariat introduced the “Framework Compilation of Proposals"(FCCC/AGBM/1997/2 and Add. 1); “Implementation of the Berlin Mandate: proposalfrom Parties” (FCCC/AGBM/ 1997/Misc.1) and “Comments from Parties”(FCCC/AGBM/ 1997/Misc.2). Regarding the organization of work, the Chair urgedAGBM to produce, elaborate on and streamline a negotiating text to be ready by 1 June.He proposed establishing two “non-groups”: one non-group to focus on institutions andprocesses, final elements, definitions and the preamble, and one non-group to work oncontinuing to advance commitments in Article 4.1. He said the main purpose of the non-groups is to exchange views, rather than to negotiate, and to merge different proposalsinto one text in order to facilitate adoption of a negotiating text.

CHINA, IRAN and MOROCCO, on behalf of the African Group, requested clarificationon the division of tasks between non-groups and asked whether the non-groups wouldaddress P&Ms and QELROs. The G-77/CHINA, supported by the EU, MALAYSIA andthe AFRICAN GROUP urged for a limited number of additional groups, given theconstraints facing small delegations. CHINA also cautioned AGBM not to “waste time”on issues related to institutions and definitions. The Chair said P&Ms and QELROswould be addressed in Plenary and noted the value of institutions and legal systems.

The EU urged countries to provide input in legal language and streamline the FrameworkCompilation text by focusing on achievable options. The EU also suggested that the Chair develop a protocol or another legal instrument by 1 June, if AGBM does not completethis work by the end of the week. IRAN said the EU proposal was premature and SAUDIARABIA urged that AGBM complete a negotiating text and not leave work for the Chair.The Chair noted that non-groups will be open only to Parties and will not involvenegotiation.

ROUND TABLE ON NEW PROPOSALS FROM PARTIES

AGBM Vice-Chair Suphavit Piamphongsant (Thailand) opened the round table and notedthat 18 new proposals have been submitted. The proposal by POLAND, BULGARIA,ESTONIA, LATVIA and SLOVENIA, stated that QELROs should be legally binding.Proposed criteria for QELROs include: GDP per capita; each Party’s contribution toglobal emissions; emissions per capita and/or emissions intensity of GDP. He alsopreferred the “menu approach” for establishing measures to be adopted by Parties.

The EU proposal includes a general commitment for Parties listed in “Annex X,” whichwould consist of OECD members and countries with economies in transition. It groupsP&Ms into Annex A (mandatory), Annex B (high priority) and Annex C (priority). Theproposal allows for joint implementation and voluntary application by non-Annex XParties.

The G-77/CHINA urged AGBM to adhere to the Convention and the Berlin Mandate andrefrain from developing new commitments for non-Annex I Parties. The G-77/CHINAproposal calls for: ensuring that P&Ms have no adverse socio-economic impacts ondeveloping countries; establishing a concrete compensation mechanism for damage indeveloping countries arising from implementation of response measures; and settingQELROS within specified time frames, such as 2005, 2010 and 2020.

FRANCE proposed differentiating the commitments of Annex I Parties according topresent emission levels of greenhouse gases per inhabitant and per GDP. He proposedcoordinating P&Ms at an international level and considering joint measures betweenAnnex I and non-Annex I Parties.

ICELAND proposed differentiation and the following parameters for identifyingdifferences in national circumstances: GHG emission intensity and level, share ofrenewable energy sources and GDP per capita. He supported the formula Norwaypresented at AGBM-5, amended to account for the share of renewable energy.MALAYSIA commented that parameters are changing regularly. MAURITIUS inquiredabout a supervisory mechanism for this formula. VENEZUELA, supported by COSTARICA, suggested “historical responsibility” as an additional criterion for differentiation.SWITZERLAND added “past efforts” by countries to reduce greenhouse gas emissions asanother criterion.

IRAN’s proposal opposes CO2 taxes, energy taxes and new commitments for non-AnnexI countries. His suggestions for reducing GHG emissions include: a focus on all GHGs,market-determined energy prices, removal of subsidies on coal and polluting energysources, development of renewable energy sources, enhancement of sinks and attention to production and consumption sector activities and industrial processes. IRAN alsoproposes a compensation mechanism for adverse impacts of response measures.Responding to ZIMBABWE, IRAN noted that its proposed compensation mechanism isdesigned to compensate countries that incur losses due to polices and measures stipulatedby the AGBM legal instrument and does not provide funds for countries that incurdamages resulting directly from climate change. The US suggested that the proposalrequires AGBM to project the consequences of non-action and asked what methodologywould be used to make such a projection. IRAN replied that further details would besupplied at a later date.

AUSTRALIA proposed: a collective reduction objective for “Annex A” Parties, whichare those listed in Annex I of the FCCC; mitigation activities that result in equalpercentage changes in per capita economic welfare among “Annex A” Parties;differentiated commitments; use of indicators in the negotiation process; and furtherconsideration of market-based approaches such as emissions trading and jointimplementation. The proposal also supports a regular review process that Parties mayactivate in regard to their own commitments. Responding to MALAYSIA, AUSTRALIAsaid formula approaches are too simplistic to account for wide variations amongcountries’ circumstances and emphasized that differentiation is not a means to delayaction, but to achieve fairness. AOSIS asked why supporters of differentiation had notpooled their proposals and requested information on how differentiation would work inpractice. CHINA expressed concern that emissions trading would replace governmentcommitments with activities of firms and individuals.

KUWAIT, NIGERIA and SAUDI ARABIA supported the proposal by the G-77/China.They expressed concern about economic and social consequences of developed countryParties’ policies and measures and requested adequate compensation for developingcountries. They recalled Article 4.8(h), which refers to countries whose economies arehighly dependent on income generated from fossil fuels, and 4.10, which states thatParties shall take into consideration the specific needs and concerns of fossil fuelproducing countries and adverse effects resulting from the implementation ofcommitments. They noted that developed country Parties should take the lead incombating climate change.

The US asked: whether developed countries that export fossil fuel or suffer fromincreased oil prices are eligible for compensation; whether developers of solar power areliable for injury; and whether developed countries that take action to prevent damage indeveloping countries are also liable under this proposal. SAUDI ARABIA reiterated thatdeveloped country Parties should bear more of the burden and accommodate such effectsthrough measures like differentiation. ITALY pointed out that the Convention does notinclude a compensation mechanism. SAUDI ARABIA, supported by IRAN, noted Article4.8, stating that funding action be considered in regard to the specific needs ofdeveloping countries. KUWAIT noted his disappointment that the developed countries'proposals do not mention any provision for developing countries' compensation.

CANADA noted that economic change in energy sources has occurred over the pastcentury and will continue regardless of a protocol. SAUDI ARABIA emphasized that it isthe right of every Party to try to minimize the adverse impacts of an international bindingagreement according to provisions given in the Convention.

NEW ZEALAND emphasized the importance of flexibility with respect to time (multi-year average emission limitations); place (emission trading); and coverage (all GHGs andsinks).

The US proposal contains: emissions budgets (banking and borrowing emissions); annualreports on measurement, reporting and compliance by "Annex A" and "Annex B"countries. Annex B would contain countries that have voluntarily entered before protocoladoption; non-compliance measures (e.g. denial of opportunity to engage in emissiontrading or loss of voting rights); continuing to advance implementation of Article 4.1,particulary "no regrets" measures; emission trading between Parties with budgets, andjoint implementation between all Parties. Several countries noted the complexity of theUS proposal. In response to the EU, the US highlighted the ability of countries todetermine their own budgets and the penalty for emission borrowing. THAILANDsuggested that AGBM not spend time discussing emissions trading.

UZBEKISTAN proposed differentiation for Annex I Parties, according to the level ofeconomic development and GDP per capita. He urged for flexibility regarding obligationsof countries with economies in transition, and developed-country support for non-Annex Icountry activities.

IN THE CORRIDORS

Several AGBM participants commented on developments towards a common positionregarding QELROs within one regional economic integration organization. Despite itsinternal debate on burden sharing, agreement was reached on a common target. Somedelegates suggested that this common position could advance the entire AGBM processby sparking a transatlantic debate. In contrast, others characterized the proposed target as“unrealistic” and doubted it would be taken seriously. One developing country delegatesaid the proposal could sharpen AGBM’s focus on strengthening developed countrycommitments, while others noted that the target’s timeframe greatly lessens its impact.

THINGS TO LOOK FOR TODAY

AGBM: Plenary will convene at 10:00 am in the Plenary I Hall and beginconsideration of the preparation of a protocol or another legal instrument. FollowingPlenary, AGBM will divide into two "non-groups."