May 15, 2021 Last Updated 6:06 PM, May 14, 2021

The UN Human Rights Office has warned of “toxic lockdown culture” in a number of countries, with UN Secretary General António Guterres reminding governments that the threat was the “virus, not people.”

States of emergency have been declared in many Pacific island nations in response to the COVID-19 pandemic, with measures including curfews, border closures, internal travel restrictions and compulsory quarantine and self-isolation periods. For the most part, quick and decisive actions from our governments has borne fruit; many Pacific island nations have been spared from local COVID cases for now, and in others, the spread has been quickly contained . They should be congratulated for that.

However some of these government-mandated measures have been challenged (with varying results), for example in courts in Guam, French Polynesia and Fiji.

Meanwhile, there have been challenges to the notions of media freedom in several jurisdictions.

To scrutinise, question  and unpack government policies, and the rationale behind them, is the job of the media. They’re not acting this way because they are evil, but because the ability to question, debate and understand is integral to a healthily functioning society.

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The Pacific Islands Forum (PIF) Trade Ministers met in February in Suva. Their key outcome on the World Trade Organization (WTO) was: “there is support for the multilateral trading system and the opportunity therein to address global trade concerns including harmful fisheries subsidies.”

In the global context of the roles of WTO and the multilateral trading system, the support above is essentially general affirmation of globalisation. Such formulation of an outcome however is not new for PIF. Previous outcomes statements have reflected the same or similar support.

However, such an expression of support raises more questions than answers. Firstly, out of the eighteen PIF members, only eight are WTO members – six Pacific Island Countries (PICs) – Fiji, Papua New Guinea, Samoa, Solomon Islands, Tonga, and Vanuatu; and the two developed countries of Australia and New Zealand. Then why should the other ten PIF members, non-WTO members, be included in the decision, one may ask. Obviously, the Trade Ministers had decided by consensus. That could mean that the non-WTO PIF members did not object to the decision.

The non-objection by the other ten PIF members would have been political to allow a decision to prevail in the interest of group solidarity. But more so, the non-WTO members know very well that regardless of their non-membership, they still benefit from the provisions of the WTO. They know, for instance, that they have benefitted from the WTO initiative of Aid for Trade (AfT). AfT resources, have been re-committed by Australia and New Zealand under the PACER Plus, and a good share of that is being disbursed through the Pacific Horticultural and Agricultural Market Access (see Islands Business July 2019).

The second question is a more substantive one. Despite all the downsides of globalisation, despite the growing inequality globally resulting from capitalism that powers global economic growth, despite the inaction of the Doha Round of trade talks (Doha Development Agenda) that was aimed at elevating the  trade and economic interests of developing countries and the least developed countries—those underprivileged under international trade— why is there still support for WTO and the multilateral trading system (MTS)?

In retrospect, it has to be said that such support is an affirmation of the benefits that WTO and MTS have generated through international trade for the region, despite their shortcomings. And these benefits can potentially increase. Furthermore, the support emanates from the realisation that all other options apart from the existing MTS will render the global trading community worse off.

WTO and the MTS it champions is rules-based. Obviously, some rules are negative and some positive. Their respective applications also create mixed results for the global trading community. Under GATT 1947, incorporated into the WTO Agreement, PICs have been able to negotiate their Free Trade Agreements (FTAs), like PICTA and PACER Plus - the latter with Australia and New Zealand, despite the fact that the negotiating model offered by the WTO is ‘broken’ – according to Professor Jane Kelsey of Auckland University.  

PICs continue to use the model since it produces a rules-based regional trading system that is better than a trading framework with no, vague or draconian rules. Furthermore, they continue to place their hopes on the model believing that the same model can result in better regional FTAs – better concessions, more creative special and differential treatments, derogation from general provisions and waivers - if there is genuine political solidarity and commitment to configure/reconfigure Pacific regionalism to something that we can all be proud of.

Furthermore, the immense benefits that PICs/Pacific African Caribbean and Pacific States (PACPs) have accrued from their membership of the ACP-EU Agreements can also be attributed to the WTO Agreement. This is so since the ACP-EU Agreement has been notified under the WTO, and its preferential arrangements are granted exceptionality under the Organization. Over the years, such exceptionality has been extended. It may also have been preserved for posterity under the application of a ‘grandfather clause.’

Fiji, for example, has benefitted immensely from the Sugar Protocol - an arrangement that offers supply quotas and preferential pricing. The Sugar Protocol, like all the other protocols offered by the EU, are formulated and implemented under the EU’s Common Agricultural Policy (CAP).

The CAP offers other preferential arrangements that have benefitted other PACPs. Fiji and others have benefitted also from EU’s Generalized System of Preferences (GSP) and may even so  from its more liberal version of GSP+. PACPS that are least developed countries (LDCs) and that export to the EU benefit under another preferential arrangement known as ‘Everything But Arms.’ The term denotes exactly what it can do and what LDCs can export preferentially to the EU.

The Americans have their own version as well. Under the African Growth and Opportunity Act (AGOA), 2000, the US offers enhanced market access to qualifying Sub-Saharan African countries. This has been extended to 2025. Fiji, in the early 2000s, was contemplating negotiating a similar arrangement that could be extended to other PICs.

As stated above, these benefits can potentially increase. Developing countries and LDCs still hold on to the hope that developed country members of the WTO will find sufficient unity and determination in their ranks to progress the provisions of the Doha Development Agenda thus creating new levels in LDCs’ respective integration into the global economy. Under that framework, it is hoped, that new creative concepts to improve the lot of developing countries and the LDCs will become more palatable.

Two concepts in this respect have entered the lexicon of the WTO recently. Emily Jones wrote in 2013: “The Right to Trade: A Mechanism for Revitalizing Pro-Development WTO Negotiations?” She later introduced in the same article: ‘right to development’. She added: “Having raised deep concerns about the failure of ‘aid for trade’ (Joseph) Stiglitz and (Andrew) Charlton make ambitious proposals for rebalancing the global trading system. The first pillar of their proposal is to enshrine and enforce a ‘right to trade’ and a ‘right to development’ through the WTO’s dispute settlement mechanism (DSM).”  

For the PIC members of the WTO, that will be most welcome. Wilfred Golman of the University of the South Pacific wrote in 2017: “The WTO DSM and the South Pacific Island Nations’ (SPIN) Participation.” Golman concluded from his research that SPIN countries were notably absent from the WTO’s DSM. He discussed a number of reasons why this was so, including: the continuing debate as to whether the DSM accommodated the interests of the developing countries or LDCs; the issue of fairness in DSM’s decisions (that the process favours richer countries as they were able to argue more effectively and settle their cases), and that the poorer countries were disadvantaged by constraints on their ability to pursue any trade infringements at the WTO level.

As tools for globalisation, there is a sense of inevitability around supporting the WTO and the MTS, regardless of their respective downsides.  This essentially evolves from the understanding that global traders, large or small, lack a better trading framework option than that presented by the existing MTS.  With the benefit of history, it can be concluded that any setback to the MTS and a reversion to excessive and uncontrolled trade protectionism will inevitably return the global trading system to one of ‘Beggar Thy Neighbour’ situation, or much worse. When that happens, international traders will essentially be engaged in a kind of zero-sum game. The end result is likely to be unprecedented global inequality.

The author is a former Fijian Ambassador and Foreign Minister and runs his own consultancy company in Suva, Fiji.

 

Gaining credits for Kyoto

  • May 16, 2021
  • Published in March

The global coronavirus pandemic has pushed climate change off the front pages, but the challenge of responding to the climate emergency has not disappeared.

Global emissions of greenhouse gases will likely drop in coming months, as air travel is reduced, international trade falters and many countries prepare for economic recession.
But later this year, governments must decide how to resume global negotiations to implement the 2015 Paris Agreement on Climate Change. The next Conference of the Parties (COP) to the UN Framework Convention on Climate Change (UNFCCC) is scheduled for Glasgow, Scotland, in November this year.

If governments come together on schedule, the battle will resume over Australia’s proposal to use “carryover credits” to meet its targets to reduce greenhouse gas emissions. As the largest member of the Pacific Islands Forum, Australia stands alone in the belief that it can meet its Paris Agreement target for emissions reduction by using credits obtained under the Kyoto Protocol, when it ends.

UNDERSTANDING THE NUMBERS
The measurement of emissions has been debated since the 1997 adoption of the Kyoto Protocol to the UNFCCC. Coming into force in 2005, Kyoto’s first commitment period ran from 2008 to 2012, with a second commitment period from 2013 until this year. From 2020, the provisions of the Paris Agreement on Climate Change come into play.

Unlike Kyoto, which set binding emissions reduction targets for just 36 industrialised countries and the European Union, the Paris Agreement is legally binding for 194 states, both developed and developing; the United States under President Donald Trump is the only nation that has announced its withdrawal after signing the treaty. Under the Paris Agreement, countries make a voluntary emissions reduction commitment – known as a Nationally Determined Contribution – with a target set for 2030.

The debate over emissions reductions and carryover credits can be confusing, as countries use different baselines to set their targets. Some commitments to reduce emissions include all sectors of the economy, while others exclude certain sectors (agriculture, land clearing and deforestation, transport, energy etc). Australia’s Department of Foreign Affairs and Trade (DFAT) states: “Under the Paris Agreement, Australia has committed to reduce emissions by 26-28 per cent below 2005 levels by 2030. This builds on our target under the Kyoto Protocol to reduce emissions by five per cent below 2000 levels by 2020.”

At the 2019 Pacific Islands Forum in Tuvalu, Prime Minister Morrison repeatedly stressed that Australia is on track to “meet and beat” these Kyoto and Paris targets. This was reaffirmed in Australia’s official statement to COP25 in Madrid, when Minister for Energy and Emissions Reduction Angus Taylor said: “Our recently released forecasts say that we expect to beat our 2020 targets by 411 million tonnes, which is around 80 per cent of a full year of emissions.”

This magic figure of 411 million tonnes comes from Canberra’s latest official emissions projections, released in December 2019. They state that Australia went beyond its target for the first commitment period of the Kyoto Protocol (2008–2012), gaining credit for 128 million tonnes of Co2 equivalent (Mt CO2-e). Further emissions reductions in the second Kyoto period (2013-2020) bring the total credits to 411 million tonnes.

There are two key reasons that Australia went beyond its Kyoto targets. Firstly, Australia had very high domestic emissions from deforestation in 1990, the baseline year to measure targets. With reduced land clearing and deforestation in subsequent years, overall emissions reduced without the need to cut as much greenhouse gas from coalfired power stations or energy-intensive manufacturing industries like aluminium and cement.

The second source of credits comes from tough Australian diplomatic tactics during the Kyoto negotiations. Instead of a reduction of emissions, the Howard government won  an increase of 8 per cent in its emissions in the first Kyoto commitment period. For the second Kyoto period, only a minimal 0.5 per cent reduction was required. With far less ambitious targets than other comparable developed countries, Australia is now claiming to have “overachieved.”

In the real world, however, the actual reduction of Australian greenhouse gas emissions is projected to be 14-16 per cent below 2005 levels by 2030, rather than the official target of 26-28 per cent. In order to “meet and beat” the Paris Agreement target, therefore, Australia must use some or all of the Kyoto-era credits.

AUSTRALIAN CHEATING
The government’s policies on Kyoto credits are backed by the coal mining industry, which is seeking to expand rather than reduce operations in coming years. The Minerals Council of Australia has argued that “the use of Kyoto carryover credits has long been accepted and is allowable under the Paris Agreement”.

This argument, however, is ridiculed by legal experts. Last month, nine law professors wrote to Prime Minister Morrison stating that there is no legal basis to meet half of Australia’s emissions targets by using carryover credits: “Our considered view is that the proposed use of these ‘Kyoto credits’ to meet targets under the Paris Agreement is legally baseless at international law. The Kyoto Protocol and the Paris Agreement are entirely separate treaties. There is no provision in the Paris Agreement that refers to the Kyoto Protocol nor to the units established under it.”

Politically, Australia is isolated from most international opinion on this issue. While Russia and Ukraine have suggested they might use these credits, all major OECD countries – Britain, Germany, Sweden, Denmark, the Netherlands, France, Norway and others – have expressly ruled out their use. Last October, Australian Department of Environment and Energy officials admitted to a Senate hearing: “We are not aware of other countries that are intending to use carry over. Just Australia.”

Professor Frank Jotzo of the Australian National University’s Crawford School of Public Policy is a leading climate policy analyst. For COP25, Jotzo was critical of the proposed use of Kyoto carryover credits: “We are the only country planning to ‘carry over.’ Almost all countries that care are opposed to it. It reminds the world of the ‘Australia clause’ which the Howard government pushed through at the 1997 Kyoto summit, allowing Australia to count land-use change reductions. It is what created the Kyoto carry-over credits in the first place.”

By themselves, Australian use of carryover credits wouldn’t break the Paris Agreement. However globally, there are billions of tonnes of credits around the world generated during the Kyoto years. Many climate analysts are concerned that Australian efforts to water down its climate targets through accounting loopholes will only encourage other major countries like Russia, Brazil and China to follow suit.

Christiana Figueres, UNFCCC executive secretary between 2010 to 2016, visited Australia in March and accused the Morrison government of “cheating” on its emissions targets.

“If you go as a tennis player to the Australian Open, and you get your final score and your final standing, do you then progress to Wimbledon and pick up the scores that you had from the Australian Open? It just doesn’t make any sense,” she said. “It is not legal, it is not correct, it is not moral. It is cheating, period. When you finish one tournament – and the Kyoto Protocol has finished – then you start the next. But you do not pull something from the previous efforts and the previous regulatory framework to the next one.”

PACIFIC OPPOSES CREDITS
Pacific governments have joined other developing states to condemn any use of Kyoto credits to reach Paris targets. The 2019 summit of the Pacific Islands Development Forum (PIDF)
in Nadi called on “relevant parties to the Kyoto Protocol to refrain from using ‘carryover credits’ as an abatement for the additional Paris Agreement emissions reduction targets.”

Last November at COP25 in Madrid, developing countries tried to include new text into the rulebook for the Paris Agreement that would ban the use of Kyoto carryover credits. During the negotiations, this ban was supported by three major negotiating blocs that include many Small Island Developing States: the Alliance of Small Island States (AOSIS), the Least Developed Countries group (LDCs) and the independent alliance of Latin America and the Caribbean.

However, the UNFCCC negotiations work on consensus, and these changes to the rulebook were not enacted in Madrid– they’ll be discussed again at the next UNFCCC meeting in June and COP26 in Glasgow.

In the final hours of the Madrid conference, Pacific delegations joined Germany, France, Britain, and other nations to condemn efforts by Brazil and Australia to weaken carbon markets. New Zealand, Marshall Islands, Vanuatu, Cook Islands and Fiji were amongst a group of 27 countries that issued the ‘San Jose Principles for High Ambition and Integrity in International Carbon Markets.’ Amongst 11 measures, these San Jose principles expressly “prohibit the use of pre2020 units, Kyoto units and allowances, and any underlying reductions toward Paris Agreement and other international goals.”

Instead of reliance on past efforts, ANU’s Professor Frank Jotzo has called for new government-to-government initiatives, creating a system with neighbouring countries for sharing the credit for bilateral initiatives to cut emissions: “Combined with meaningful action to cut emissions at home, it would signal that Australian ingenuity can be used to address climate change, not just for creative accounting. As the developed country most affected by climate change, it is in our interest to lead by example, not to be seen as a recalcitrant.”

The future of this debate is in the wind. The current global crisis around the COVID-19 coronavirus involves economic and social effects that make the future of climate policy hard to predict. Even so, governments around the world are adopting tactics that will be required to respond to the climate emergency; drawing on the advice of scientific experts rather than ideologies prioritising the health and wellbeing of citizens over existing priorities on debt and deficit, massive financial support to industries affected by the crisis, establishing “whole of government” taskforces and even governments of national unity.

Will we slip back to business as usual on climate policy, or will the experience of working together on COVID-19 provide a model for national and global co-operation in response to the ongoing climate emergency?

 

nicmac3056@gmail.com

For the Pacific Islands Forum (PIF), the disappointment of COP25 was that the conference attendees did not take its rallying cry for greater commitment: ‘climate change crisis’ - to heart. Recall the PIF Chair’s remark after the conference: “It is disheartening that our collective political commitment and resolve, as the Pacific Islands Forum, was not upheld by the parties to this declaration, where it mattered most – that is in the negotiating rooms in Madrid.”

In reviewing what was said and published post-COP25, however, it seems that the ‘climate change crisis’ message has obviously hit its targets in the wider audiences - those who do not necessarily have reserved seats in the global conference rooms. Writer and historian Yuval Noah Harari, for example, has written about the prospects of an ‘ecological collapse’, and he sternly warned global leaders about it recently at their World Economic Forum Annual Meeting held in Davos-Klosters, Switzerland last January. 

Another eminent writer and Guardian columnist, George Monbiot, joined others in posing the question that in the light of the deteriorating climate change situation, whether humanity has started to breach some tipping points in climate change. Fred Pearce expands on this theme: “…the earth may be approaching key tipping points, including the runaway loss of ice sheets, that could fundamentally disrupt the global climate system. A growing concern is a change in ocean circulation which could alter climate patterns in a profound way.”

Furthermore, the Climate Emergency Movement has determined that: the “…world may have crossed tipping points - warning of ‘existential threat to civilisation’ as impacts lead to cascade of unstoppable events.” To underline the existentiality of the threat by way of analogy, the BBC News has pointed to its own nuclear Doomsday Clock which is now indicating how close our planet is to complete annihilation: “it is only 100 seconds away from midnight! This is the nearest we have been to apocalypse!”

Notwithstanding the disappointment of COP25, the reality of the climate change situation is that the solution - and there has to be a solution - has to be on a global level.

What therefore of the region? To grant globalism a modicum of success, regionalism has to step up its act. Greater global inter-dependence is called for. This implies a lot of things. As a start, for Pacific regionalism, for instance, it cannot be business as usual. Pacific regionalism has to be strengthened. New ideas, new solutions, new methodologies have to be found and put to use with unprecedented levels of energy and strength of commitment.

“The answer, my friend, is blowing in the wind”, echoes the lyrics of Bob Dylan’s famous song. And the commentator’s take: “The answers are there in the wind. They move, they change, but the answers are there. It’s only a matter of trying to pick them up.”

I have been playing the commentator’s role as a contributor to this magazine since last September. My article for the September/October (2019) issue: ‘Death of Pacific Regionalism?’, was a proposition that we need to approach Pacific regionalism differently from what we have been doing since 1971. My December article: ‘2050 Strategy for the Blue Pacific Continent: A Sea Change?’ explored the likely approach to the formulation of the 2050 Strategy for the Blue Pacific Continent in my attempt to build a regional architecture that is essential and conducive for a fresh approach to Pacific regionalism.

My January 2020 article: ‘PIF Identity May Need Re-focusing’ delves deeper into what we are – our regional persona. If we are to be different and to assert our persona and our agency, we have to correct one of the building blocks of what we are and what we project to the world. My February article: ‘PIF Needs to Strategise After COP25’, points to some options that our new approach can take, especially in the context of our existential threat of climate change, given the disappointment of COP25. I discussed the prospects of southsouth, north-south and triangular co-operations in addition to our multilateral approach.

Now, let us look for some other answers in the wind. The proposed 2050 Strategy is giving prominence to the interests of Pacific Island Countries (PICs), not only in terms of issues and policies but also in terms of their options as regards the regional architecture of Pacific regionalism. This makes a lot of sense when it comes to climate change. There is no unity in climate change among PIF members. But it is the Pacific Island Countries (PICs) amongst them that understand fully the existentiality of the threat that climate change presents.

In geopolitics as well, PICs are generally used as pawns of the bigger and developed powerful countries, especially the Pacific Rim countries. PICs know best their own situations and feel more passionately about being shunned and ignored when other powerful allies abuse their agency and speak on their behalf as if they don’t exist.

In mid-2019, an answer had blown in from the northern wind when former Prime Minister Enele Sopoaga of Tuvalu suggested the ‘United States of the Pacific’ as a way of restructuring Pacific regionalism. This was a way of creating a forum for PICs only and he justified this as a means ‘to amplify(ing) their concerns about climate change on the global stage.’

A new answer blew in late last year in the form of a consultant report to PIFS on ‘Review of the Forum Processes’. I admit that I was one of the consultants that drafted the report. My partner in crime and a senior partner at that was Garry Wisemen, formerly of UNDP and PIFS. Strengthening the role of the PIF Troika (comprising at any time the former, current and in-coming Chairs) was recommended in the report. And what better way to start the work of the empowered Troika than on the climate change crisis! If managed and resourced well, there could be early dividends to reap.

The current composition of the Troika comprises Nauru, Tuvalu and Vanuatu. The all-PIC composition is ideal for the Troika’s strengthened role in climate change crisis. Its role has to be formalised and protected. It should not be subjected to variation with changing membership.

The Troika is to be charged to spearhead all discussions/negotiations/advocacy on climate change crisis, starting with relevant PIF membership and extending beyond the region. These negotiations need to be intensive and focused. The Troika is to direct its first advocacy with PIF’s developed country members of Australia and New Zealand (ANZ). PIF will be more convincing globally if it starts its climate change  crisis advocacy properly at home.

The Troika’s work, as far as ANZ are concerned, is unequivocal, given our climate change knowledge of the causes of greenhouse gas emissions of those countries. For Australia, the PIF Troika is to advocate for an effective programme for that country to wean itself from fossil fuels. For New Zealand, the Troika is to advocate for the production of ‘clean meat’ in the not-too-distant future.

‘Yes, and how many ears must one man have, before he can hear people cry? Yes, and how many deaths will it take till he knows, that too many people have died? The answer, my friend, is blowing in the wind. The answer is blowing in the wind.’

 

The author is a former Fijian Ambassador and Foreign Minister and runs his own consultancy company in Suva, Fiji.

Economy 2020: A rocky start

The Coronavirus outbreak, the Australian bushfires,  continuing US-China geopolitical and trade tensions and damage caused by Tropical Cyclones Tino and Sarai have seen 2020 get off to a difficult start in our region. Pair that with sensitive regional trade negotiations, a New Zealand election and Brexit, and Pacific island countries are looking to downgrade economic  growth projections across the board.

As we went to press, coronavirus (or COVID-19) diagnoses stood at almost 77,800  globally. There had been 2348 confirmed deaths and cases confirmed in 28 countries, including Australia. There had been no cases recorded in any Pacific Island nations.

Oxford Economics has projected COVID-19 will cost the global economy over US$1tn (representing a 0.5 per cent fall in global GDP)  if it becomes a pandemic and spreads beyond Asia. The firm’s economic modelling suggests the virus is  already having a “chilling” effect as company after company report amended revenue forecasts as a result of production challenges and supply problems. China’s GDP will fall from 6 per cent last year to 5.4 per cent in 2020 predicts Oxford Economics. ANZ Research predicts a greater impact, a decline in GDP to 5 per cent.

While Pacific Island nations have significant, and growing links with China, it’s the impact of  the coronavirus, on top of the devastating summer 2019/20 bushfires on close neighbour Australia that may have the more significant immediate impact.

Australia’s Reserve Bank says the coronavirus poses a material threat to Australia’s economy. It had already estimated the bushfires would cut economic growth by 0.2 percentage points in the December and March quarters, and that drought will cut GDP by a further 0.25 per cent throughout this year. Deloitte Access Economics says the coronavirus will cut $1.8 billion from budget revenues.

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