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Climate change: who pays the price?

By Najib Saab
January/February 1998

The Organization of Petroleum Exporting Countries (OPEC) has finally adopted a firm stance regarding its participation in international measures to tackle the issue of climate change. For the first time, the organization declared, during the Climate Summit in Kyoto last month, a courageous stand to protect the rights of oil exporting countries, the majority of which are developing non-industrialized nations, and safeguards the interests of poor countries. OPEC statements were very well structured not to show the the organization is abandoning its commitment to international environmental action.

 

OPEC member states demanded financial compensations for their future losses due to the imposition of high taxes on oil, an act that will reduce oil consumption. The plan proposed by industrial countries to reduce carbon dioxide emissions is expected to decrease oil production, resulting in an annual loss of twenty billion dollars to OPEC states. The majority of oil producing countries are developing countries in the Arab World, Asia, Africa and Latin America. They lack large industries and still need to spend billions of dollars on social and economical development programmes. Like poorer countries, they believe that the rich industrial nations should bear the bulk of cleaning the environment, since they are basically responsible for its contamination.

 

Oil producing countries, and other developing and poorer countries, should not be driven to commitments harmful to their peoples, under the pressure of international financial and industrial powers. However, this should not mean that the issue of climate change is not crucial, and should not be taken as a pretext for delaying necessary measures. It is evident that the climate is drastically changing as a result of uncontrolled practices in industry and transportation. Most scientists agree today that the continuation of present practices may raise global temperature by 3.5 degrees during the next century. This will cause a 15-25 cm rise in sea levels and change coast, desert and forest ecosystems.

 

Climate change is caused mainly by gas emissions from burning fuels in industry, transportation and energy production. The solution is reducing the use of polluting fuels and developing cleaner energy sources. This, however, will increase production costs.

 

Where do the world nations stand regarding this issue?

 

The United States, which hosts 4% of the world population, is responsible for 25% of the gas emissions causing climate change. If current policies persist, the emission of these gases in the United States is expected to increase by 23% in 2010, compared to their levels in 1990. On the other hand, the European Union suggested a reduction of 15% before that date. The United States also calls for imposing the same emission reduction rates and deadlines on poor developing countries as industrial countries, regardless of the negative impact on their development programmes. Australia, on the other hand, is threatening not to abide by any reduction that may cause job losses and slow down economic development.

 

Amid these conflicts, OPEC countries joined the poorer countries in adopting a unique position. In the past, they categorically refused to discuss any oil tax increases, which gave them an environmentally unfriendly image. In contrast, they have now adopted a wise tactic that is sure to cause serious embarrassment to industrial countries: it is a position which combines environmental protection with economic interests. Now OPEC says: it is ok to increase taxes on oil, but those should be accompanied by proportional higher taxes on every other source of energy.

 

That is because environment protection should not be used as a cover to punish oil countries to the advantage of other polluting sources of energy. OPEC's declared view now is that increased tax on oil has become another source of great revenue to rich industrial countries, on the pretext of environmental conservation. As a result, they will gain from oil taxes much more than what the producing countries earn from selling oil. If environmental conservation is the real issue, the rich industrial countries should give a major cut of oil taxes to developing oil producing countries and other poor developing countries, as compensations to help them develop their environmental protection programmes.

 

This is sound reasoning to which the west would listen, and OPEC should persist on this path.

 

We are part of the Arab world, and members of the group of developing poor countries. We rely on Arab oil producing countries for the major part of the resources required for the much needed development programmes in poorer Arab countries. While we should care about our environment, we have to be careful not to blindly join any international environmental chorus. We should not yield our interests to the hammers of "environmental globalization", especially when it means that only the poor should pay the price.

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ARAB ENVIRONMENT IN 10 YEARS crowns a decade of the series of annual reports produced by the Arab Forum for Environment and Development (AFED) on the state of Arab environment. It tracks and analyzes changes focusing on policies and governance, including level of response and engagement in international environmental treaties. It also highlights developments in six selected priority areas, namely water, energy, air, food, green economy and environmental scientific research.
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