Fairer Way to Help Developing Economies

Context: Coordinated aid and technical assistance to help developing countries decarbonise are essential to meet emission targets.

Reasons for rising CO₂ Emissions:

• Need for emerging markets: According to the estimates of International Energy Agency (IEA), almost all growth in carbon dioxide emissions over the next two decades will come from emerging markets.
• Huge share in consumption and output of coal:
  • China accounts for half of the world’s coal output and half of its coal consumption.
  • India is highly dependent on its plentiful coal reserves, and will likely remain so despite strong advances in solar power.
• Low share of clean energy in global energy investment: only 34% (same as five years ago)
• Reluctance to decommission coal plants: As the cost is huge and coal is one of the few natural resources that China and India possess in abundance.

Ways to encourage developing economies to cut their CO2 emissions

• Impose carbon border tax: to ensure a long term sustainable funding system
  • However, it is not a practical solution as developing economies have neither the resources nor the technology to transform themselves overnight.
• Aids from the developed world: provide the developing world with a carrot and not just a stick.
  • By developing the World Carbon Bank to provide highly concessional financing, combined with technical expertise and sharing of best practices.

Conclusion: A global approach is needed to solve the CO2 emissions, rather than the approach of Not-in-my-backyard (NIMBY) environmentalism.