The future of globalisation? We could tell you, but we’d have to kill you

As regular readers will know, I’ve been banging on for a long time about the need for a comprehensive database that tells us exactly how exposed international trade is to peak oil – or, for that matter, to the maritime sector being brought into the international climate regime and made subject to really severe emission controls.

After all, the bunker fuels used to power container ships and bulk carriers are much less easily substitutable than other kinds of fossil fuels. You can replace coal-fired power stations with renewables or nuclear; you can replace petrol-fuelled cars with ones that run on electricity or hydrogen.  But ships? That’s another story. As a UK government study published just before Copenhagen found, for instance, “it will be extremely challenging, and expensive, to reduce emissions of carbon dioxide from shipping and aviation … there are a number of options available in each sector, but currently most of these are not economically viable”.

But if we don’t have readily available substitutes for marine bunker fuels, then what happens to maritime trade – to globalisation itself, in other words – if oil costs start really soaring again, or governments start to get serious about carbon pricing?

In particular, as I asked in The Feeding of the Nine Billion, what happens to the import bills of countries that depend on food imports from overseas (like most of the fragile states in West Africa, for example)? And what does it mean for China – whose advantages on wage costs could easily end up offset by increased transport costs, as actually happened when oil costs went into triple digits?

Although a number of analysts have been asking that question ever since the oil price spiked in 2008 (most notably Jeff Rubin – see the link above and also this), what we’ve all lacked is a really serious database that works out the costs of maritime trade, and how exposed these are to energy prices. Until now.

For it turns out that the OECD have been compiling a large new Maritime Transport Costs database. Although they didn’t make a lot of noise about it, they also posted a working paper (pdf) on their website a few months back – which confirms the significance of the issue (emphasis added):

Maritime transport costs represent a high proportion of the imported value of agricultural products — 10% on average, which is a similar level of magnitude as agricultural tariffs. This study shows that a doubling in the cost of shipping is associated with a 42% drop in trade on average in agricultural goods overall. The tendency to source imports from countries with low transport costs is therefore strong. Trade in some products is particularly affected by changes in maritime transport costs, in particular cereals and oilseeds, which are shipped in bulk.

Most valuably of all, the database goes into massive levels of detail on fuel costs in particular – making it a truly indispensable part of the toolkit for working out what happens to globalisation in a world of emission controls and peak oil. So, where can you access the database?

Answer: you can’t. For news reaches me that its publication is being blocked, by one OECD member state alone – namely, the United States. For, it is said, reasons of national security. How do you like them apples? (Locally grown, I suppose.)

BASIC puts forward its candidate to replace Yvo de Boer at UNFCCC

A small but potentially rather significant exchange in the UN Secretary-General’s spokesman’s press briefing on Thursday last week:

Question:  India has said that it’s put forward a candidate to replace Mr. [Yvo] de Boer on the UNFCCC [United Nations Framework Convention on Climate Change].  It’s named the individual, and said that it has the support of China and other BRIC nations.  I just wondered, first, can you confirm that names have been received by the Secretary-General for that post?  How many names and what’s the process for selection?

Spokesperson:  I can’t confirm whether specific names have been given or not.  Clearly, there is a process that’s under way.  This is an appointment that is indeed made by the Secretary-General in consultation with the Board of the United Nations Framework Convention on Climate Change.  There is still a way to go in that selection process, and I don’t want to get into details here

So who might India’s candidate be? Over to wire coverage a day earlier from Indo Asian News Service (which seems to have been barely noticed outside India):

Environment Minister Jairam Ramesh has written to the United Nations backing the candidature of Vijai Sharma, secretary with the ministry, for the post of executive secretary of UN Framework Convention on Climate Change (UNFCCC). The minister said here Wednesday that China has already supported the move.

‘Vijai Sharma is our official candidate for UNFCCC executive secretary. I have written to the United Nations Monday and have also written to BASIC (Brazil, South Africa, India, China) countries seeking their support. We have got support from China already for his candidature and we will get support from other BASIC countries,’ Ramesh said at an interaction at the Indian Women’s Press Corps.

Ramesh said the time has come for the post to go to a developing country. ‘The first three secretaries have all been from developed countries and Vijai Sharma has long years of experience with UNFCCC. He was chief spokesperson for G77 for Kyoto negotiations. I am pursuing it. I am not sure as European countries and the US will prefer somebody from a smaller country and India is unarguably at a different profile but I would like to see him there,’ the minister said.

Sharma – a career bureacrat – is well-respected inside the UNFCCC process as far as I can make out.  But I wonder whether India’s making a tactical error in equating “developing country” interests with those of the BASIC grouping of emerging economies. At Copenhagen, BASIC’s hardline position was conspicuously not in the interests of the least developed countries who stand most to lose from climate change.  It’ll be interesting to see whether an alternative developing country candidate comes forward – one from the ‘survival’ rather than the ‘growth’ faction of the G77.

Blame China

Mark Lynas in today’s Guardian:

The truth is this: China wrecked the talks, intentionally humiliated Barack Obama, and insisted on an awful “deal” so western leaders would walk away carrying the blame. How do I know this? Because I was in the room and saw it happen.

China’s strategy was simple: block the open negotiations for two weeks, and then ensure that the closed-door deal made it look as if the west had failed the world’s poor once again. And sure enough, the aid agencies, civil society movements and environmental groups all took the bait. The failure was “the inevitable result of rich countries refusing adequately and fairly to shoulder their overwhelming responsibility”, said Christian Aid. “Rich countries have bullied developing nations,” fumed Friends of the Earth International.

All very predictable, but the complete opposite of the truth. Even George Monbiot, writing in yesterday’s Guardian, made the mistake of singly blaming Obama. But I saw Obama fighting desperately to salvage a deal, and the Chinese delegate saying “no”, over and over again. Monbiot even approvingly quoted the Sudanese delegate Lumumba Di-Aping, who denounced the Copenhagen accord as “a suicide pact, an incineration pact, in order to maintain the economic dominance of a few countries”.

Sudan behaves at the talks as a puppet of China; one of a number of countries that relieves the Chinese delegation of having to fight its battles in open sessions. It was a perfect stitch-up. China gutted the deal behind the scenes, and then left its proxies to savage it in public.

Meanwhile, the FT observes, cracks are starting to appear among the emerging economies:

Cracks emerged on Tuesday in the alliance on climate change formed at the Copenhagen conference last week, with leading developing countries criticising the resulting accord.The so-called Basic countries – Brazil, South Africa, India and China – backed the accord in a meeting with the US on Friday night, and it was also supported by almost all other nations at the talks, including all of the biggest emitters.

But on Tuesday the Brazilian government labelled the accord “disappointing” and complained that the financial assistance it contained from rich to poor countries was insufficient. South Africa also raised objections: Buyelwa Sonjica, the environment minister, called the failure to produce a legally binding agreement “unacceptable”. She said her government had considered leaving the meeting. “We are not defending this, as I have indicated, for us it is not acceptable, it is definitely not acceptable,” she said.

Climate Groundhog Day

“This agreement is a vital step forward for the whole world,” Gordon Brown after the Bali climate summit in December 2007.

“This is the first step we are taking towards a green and low carbon future for the world,” Gordon Brown after the Copenhagen climate summit in December 2009.

“A pivotal first step toward an agreement that can address the threat of climate change,” Ban Ki-Moon after the Bali climate summit in December 2007.

“It is a step in the right direction,” Ban Ki-Moon after the Copenhagen climate summit in December 2009.

Copenfailure: a first analysis

So here’s a very rough first analysis of the Copenhagen outcome.

Of the three Copenfailure scenarios David and I outlined, we think this morning’s Copenhagen Accord is closest to a very, very weak version of Bali #2. On that basis, here are 10 initial thoughts on what happened, where we go next, and how countries performed at the summit.

1. Don’t Panic.

2. We need to own up to how weak and ineffective deal-makers have been.

3. We also need to face the fact that the international system for dealing with climate is broken.

4. With this said, as UN Assistant Secretary-General Bob Orr observed in a press conference this morning, the head of governmment level engagement was “the most genuine negotiation I’ve ever seen between leaders”.

5. The main thing deal-makers need to do now remains: be brave, and steer into the skid.

With regard to countries’ positioning:

6. The US is still all about domestic legislation – which is as far away as ever.

7. The EU had a shocking summit, captured for all to see in its exclusion from the closing hours caucus of US, China, India, South Africa and Brazil. The open question of whether any hypothetical deal would have been bad enough for the EU to reject it did nothing whatsoever to enhance EU influence.

8. Appeasing China has failed. Period.

9. Much of the G77 participated in its own shafting – a point seen most clearly in Sudan’s chairmanship of the bloc.

10. But there are some weak signals of fragmentation in the G77 – seen most clearly in the case of the Maldives, which showed real determination in standing up to China.

A rough guide to Copenfailure: conclusion

In the first three parts of this series (1, 2, 3), David and I have explored how Copenhagen might fail; what might lead it to do so; and why some kinds of failure are better than others.  With the summit now into its closing hours, this final post turns to how leaders should respond if the summit really is headed for deadlock.

Right now, the likely outcome of the talks remains shrouded in uncertainty.  All three of the possible scenarios we discussed in Part 1 of the Rough Guide – a Bali 2 political deal without numbers, a Bad Deal with weak numbers, or an out-and-out Car Crash – remain entirely possible. (And let’s not forget that it’s still at least conceivable that the summit could actually succeed – in other words, reach a binding deal which puts the world clearly on track for limiting warming to two degrees C – which would be by far the best case scenario.)

But if, as currently looks more likely, the summit fails to produce a robust deal, then we argue that the most important thing is for policymakers to steer into the skid.

When a car loses grip on the road and begins to slide, the driver’s every instinct is to turn away from the skid to try to control the car. Actually though, what the driver must do is to steer into the skid – or, as driving instructors put it nowadays, “take your feet off both pedals and align your tires with the direction of your intended travel”.

If things start to slide at Copenhagen, the instinct of some policymakers will be settle for whatever deal they think they can reach. It’s a well-honed script; and if, this time tomorrow, you see pro-deal policymakers like the UK’s Ed Miliband doing the rounds of TV news studios saying things like “No, it’s not all we were hoping for – but it is a step in the right direction, and in the end, we mustn’t let the best be the enemy of the good”, then you’ll know that this is what has happened.

Other policymakers will react to a skid by slamming on the brakes (e.g. “This thing is just too complicated to deal with through an international treaty – let’s just all do national policies and see what they add up to in emissions reduction terms”), or indeed by applying more gas (“Two degrees was a total sell-out anyway! When policymakers come back, we have to push them for zero emissions by next Thursday!”).

What advocates of a serious deal should actually do, on the other hand, is – ready? – take feet off both pedals and align the tires with the direction of intended travel.

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For better or for worse, two degrees has become a widely agreed upon reference point. So what policymakers should do at Copenhagen is keep their tires resolutely aligned with two degrees. If what’s on the table at the end of the day is clearly off track for that, they should still keep steering towards it – even if that means refusing to sign the deal.

If pro-deal policymakers – especially the EU – do no better today than merely deferring failure, then they’ll allow themselves to pushed into a defensive posture.  That will make them  look weak, further eroding their (already declining) influence over the process.  Worse, it will undermine the principles that are the essential rationale for an eventual deal. Only by guiding, shaping – and, if necessary, accelerating – breakdown, will champions of a deal have the basis for turning defence back into attack.

True, the best should not be the enemy of the good. But neither should the ever-changing calculus of political possibility lead us to shut our eyes to another crucial test: what’s good enough.  The EU and other champions of two degrees must stick to their guns today.