TCS Daily


TCS COP 10 Coverage: The EU is No Longer United

By Carlo Stagnaro - December 16, 2004 12:00 AM

The European Union is no longer united. Until a few days ago, all of the member states were supposed to share a common position at least on environmental policies. Now, Italy has put it clear that it will not follow Brussels on the path of a perennial struggle to cut greenhouse gas (GHG) emissions.

"The first phase of the protocol ends in 2012; after that it is unthinkable to go ahead without the United States, China and India," said Altero Matteoli, Italian minister of Environment. "Seeing as these countries do not wish to talk about binding agreements," he went on, "we must proceed with voluntary pacts and commercial partnerships."

Matteoli took a stand in a largely unexpected way; yet he made an evidenced-based decision. The problem is not only that the science is uncertain about the dynamics, the causes, and the potential consequences of global warming. The point is that, even if it is true that man-made emissions are affecting the climate, a Kyoto-style treaty will result in nothing, except an expensive bill to be paid for by the Kyoto-ist countries.

The Kyoto Protocol requires developed countries to cut their GHG emissions by 5.2% under 1990 levels. Since developed countries account for roughly 50% of global emissions, this would mean a mere 2.6% cut in net terms. That is, almost nothing. In fact it is worse than nothing: resources which are spent in cutting emissions are no longer available for fighting more urgent problems, including potential local, negative effects of global warming itself.

Things get even worse if you look at the future: developing countries are projected to emit 75% of global emissions by 2050. A 100% cut in the emissions from developed nations (i.e., our extinction as a civilization) would not prevent atmospheric concentrations of CO2 to increase.

And what about the costs of the process? The Kyoto-ist countries would have to give up a substantial portion of their economic growth (a UNICE study estimated the costs of Kyoto to Europe around 0.5% less GDP in the first commitment period). At the same time, developing countries would pay nothing and, indeed, would gain a competitive advantage. It is questionable that such a region as Europe, whose growth in 2003 was just 0.4%, has a duty to pay, even by transferring technologies to countries that grow more than 20 times faster!

Minister Matteoli well understood all of this. He also understood that Kyoto would be much more costly to Italy than to other European Countries. Indeed, nations such as France and Germany are more or less on the track of meeting their Kyoto targets without big efforts. The reason is simple. Since emissions are to be reduced relatively to 1990 levels, Germany has gained huge successes in limiting emissions by improving the inefficient industries in the Eastern part of the country (which was under a communist regime until 1989). Such an improvement is good in, but it surely was not undertaken with the idea of saving the climate. As far as France is concerned, it strongly relies on nuclear power, an emission-free source of energy (and perhaps a more expensive one than hydrocarbons). It is dubious that environmentalists would join a pro-nuclear campaign in Europe.

On the other hand, in Italy the cost of energy is very high. Reducing emissions might push the price of energy upwards. Corrado Clini, the director general of the ministry of Environment, repeatedly warned against the high cost of Kyoto to Italy; and Paolo Togni, the chief of Matteoli's staff, often called the attention over the scientific uncertainty. The president of the Environmental Committee of the Senate, Emidio Novi (Forza Italia), and his counterpart in the Chamber, Pietro Armani (Alleanza Nazionale), have been strong supporters of the minister.

Italian entrepreneurs seem to agree, too. Emma Marcegaglia, a vice-president of the Confindustria (the association of entrepreneurs) said that actions aimed at mitigating global warming "should not compromise Italian competitiveness." Nor does the opposition to Kyoto come just from right-wing parties and industry: Senator Franco Debenedetti (Democratic Left) wrote that "Kyoto would be an exogenous shock for our economy, as it happened with the first oil crisis, but differently from that time, this would be a permanent shock."

Nonetheless, prime minister Silvio Berlusconi had some role in the Italian decision to secede from European climate policies. Nobody believes that it was by pure chance that Matteoli's declaration came just a few hours before Berlusconi's meeting with the American president Bush. Nor is it by chance that the skepticism over Kyoto had never emerged before: it is just in the last few weeks that Berlusconi, who was elected with a free-market oriented electoral campaign, has realized he has had to maintain his promises if he wants to be re-elected. So, he made a kind of tax reform (which is admittedly a first step towards a more radical one) and now Italy is somehow freer from the Kyoto commitments.

The resistance against European, suicide unilateralism on environmental issues has begun.


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