Why with all the growing fraud & criminality the historic polluters continue to push the carbon market?

Introduction

This week I shall conclude my discussion of the global carbon market and the hopes many place on it for helping to provide a solution to the problems of global warming and climate change. As a reminder in my column on May 30, I had indicated that the columns dealing with this topic, which were to commence in June would represent my personal contribution to the events honouring the memory and contributions of Walter Rodney to the empowering of all Guyanese.

So far in this analysis I have tried to make clear that, on balance, the global carbon market has had minimal impact on the climate problem and in all likelihood this will remain so for the foreseeable future largely because of endogenous criminality. Despite this, however, market-based solutions continue to remain very popular among the rich countries that are the historic polluters. I believe that this is mainly due to the implicit “burden-shifting”, which these solutions encourage. I have shown that often this is thinly disguised as money (aid), which is being given by rich countries to poor ones for the global environmental services they provide! Apart from the implicit “burden-shifting”, there are also sought after opportunities for corporations in rich countries to do profitable business in poor ones as the aid funds are spent. It is behind this aid subterfuge that rich countries continue their unabashed reliance on fossil fuels, thereby reinforcing the global mal-distribution of income and wealth, which unregulated markets systematically reproduce on an ever extended scale.

Corporations’ preferences on the climate exchanges

In light of the above, and despite the several risks posed by trading in forest offsets projects, they nevertheless remain quite popular with corporations in rich countries. A recent Survey of 200 global corporations was conducted by the firm Eco Securities in order to establish their attitudes towards forest offset projects. Among their many findings, the following four have the greatest bearing on my assessment of the global carbon markets.

The vast majority of firms in Europe have either a “positive or very positive” attitude (84 percent) toward forest offset projects. Worldwide the ratio is 80 percent.

South America is the preferred region for the location of these projects (74 percent of the corporations preferred that region).

The benefits of carbon offsets projects that were most preferred are: 1) good carbon standards- 84 percent; 2) location- 84 percent; 3) type of project- 80 percent, with “reforestation with native species” and “avoided deforestation’ the two most popular (89 and 78 percent  respectively); and 4) the projects ability to generate community and bio-diversity benefits (83 and 77 percent respectively).

4 There are several carbon standards operating in the global carbon market but the two most popular are the Voluntary Carbon Standard (VCS), which accounts for 73 percent of the first preference of corporations followed by the Climate, Community and Biodiversity (CCB) Standard, 64 percent.

Those readers who have been following this series of SN columns would be aware that the LCDS is envisioned as an “avoided deforestation” project. Therefore, based on the Survey’s results it should be highly prized by the corporations operating on the climate exchanges.

What do these Survey results indicate? I believe that the very strong sympathy for forest carbon offset projects exhibited in the Survey represents a desire by participating corporations to exercise their corporate responsibility in a manner, which makes it appear that they are only too willing to assist poor rainforest nations to use their forest resources both in the fight against the global climate problem and towards alleviating their domestic poverty. Regrettably, in light of the flaws in the global carbon market, which I have revealed over the three immediately preceding columns, this remains in my view too little too late.

Oslo Conference

A significant complement to these Survey results is the recently held one-day Oslo, Norway, Climate and Forest Conference, where a combined total of 52 rich industrialized countries and poor rainforest ones sought to establish a legally non-binding “partnership”, working under the REDD- plus framework. The stated goals of the partnership are 1) to integrate it into REDD- plus so as to create one coherent framework, which would work together on the basis of a common set of transparent principles and participatory actions for agreed common purposes 2) to pursue sustainable development strategies. These would emphasise the preservation of biodiversity, the livelihoods of forest-dependent communities and wider global environmental integrity and 3) to secure short-term and long-term financing, without which neither mitigating actions by poor rainforest countries can be assured, nor their reduced emissions from deforestation and forest degradation afforded.

However, there is a general feeling abroad that the true aim of the Conference was two-fold. First, to stimulate actions for the replacement of the Kyoto Protocol at the forthcoming Conference of Parties (COP16) to be held in Mexico later this year, under the auspices of the United Nations Framework Convention on Climate Change (UNFCCC); second, to speed up the transfer of pledged climate funds from rich to poor countries, particularly I would add those promised at the recent unsuccessful Copenhagen Climate Summit, held last December.

All of this has been occurring even as toxic carbon offset projects are more and more frequently appearing on the various climate exchanges. For as I have shown, firms located in the rich countries (especially Europe) are not only securitizing carbon offset instruments, but they are also engaging in fraudulent transactions, reaping benefits from several Treasuries, particularly those of the European Union Member States as well as gullible individuals and corporations.

CONCLUSION

In conclusion readers should constantly bear in mind that poor countries generally, and in particular poor rainforest ones, are by no means significant contributors to global warming and climate change. Indeed as victims of colonial plundering and pillaging of their resources mainly for the benefit of rich countries, they are owed an enormous climate debt by the global North for imposing on them because of their poverty the lion’s share of the negative consequences of the global climate problem. Unfortunately, however, they now find themselves being manoeuvred by the rich countries (with the collaboration of their own elites) into a situation where they are constantly being coerced in myriad ways into assuming a disproportionate share of the burden of providing solutions to the global climate problem. Ironically, this occurs even as rich countries continue to “drag their feet” and pursue “business as usual”.

This discussion leads directly into what I plan to consider as of  next week. That is, the rich countries pledged funds to tackle the global climate problem.