Wednesday, 13 April 2011 09:29

The Squeezed Middle: Why Latin America Matters in Climate Politics Featured

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Latin America matters in international climate politics. Its emerging leadership role at the international climate change talks, on low-carbon pathways and climate finance illustrate how some Latin American countries may shape the negotiations and the region this decade.
But the longevity of current interest in climate change in Latin America is difficult to predict. While climate vulnerability and the growing awareness that the region needs longer-term planning and better infrastructure to deal with climate-related impacts and natural disasters presents a positive discourse, stronger economic ties with China may increase the prospect for carbonization across Latin America as some countries push for growth at any cost to capitalize on China’s thirst for commodities. Whether Latin America can remain a relative low-carbon region is uncertain. What is clear is that the current climate momentum in many countries is unprecedented and needs to be maintained. Latin America has never before had such an impact in the international climate negotiations After a serious low point in Copenhagen, the 2010 COP16 succeeded at putting the negotiations back on track through the competent performance of the Mexican diplomatic team who emerged as the new engineers of consensus. Mexico’s impressive performance was also a Latin American success story for it showed the international community that the region has the skills and stamina to bring a process in crisis back to a more stable condition. The talented performance of Costa Rica’s Christiana Figueres as UNFCCC Executive Secretariat who brought a fresh, ‘yes, we can’ impetus to the negotiations was noteworthy. Figueres skillful management of the UNFCCC process and adept handling of the media in Cancun demonstrate that a representative of small country can play a key role in creating the right conditions.  For women across Latin America and indeed globally, the scene of two women, Mexican Foreign Minister and COP16 President Patricia Espinosa and Christiana Figueres bringing the COP16 to a successful conclusion set an inspiring precedent. The Cartagena Dialogue for Progressive Action has become the most constructive voice in the climate negotiations. This group is not a formal negotiation block and does not want to become one. Rather its goal is to create a safe space for negotiators driven to bridge the North-South divide and avoid polarizing positions that often lead to paralysis at the negotiations. The Dialogue includes members from Latin America, Africa, Asia, Small Island States, Europe, Australia and New Zealand with a strong Latin American presence from the outset with active participation from Colombia, Costa Rica, Chile, Peru, Guatemala, and Panama. Middle income economies in Latin America, such as Costa Rica, Mexico, Chile and Colombiado not embrace the ‘politics of anger’ observed in other delegations.  As these middle-income countries develop, they increase their pragmatism leaving behind a victim mentality that pervades the UNFCCC in favor of climate leadership. In Cancun, Mexico focused on becoming a bridge between the different blocks. Latin America is “squeezed” in the middle: the region is insufficiently large and powerful (Asia) and insufficiently poor and vulnerable (Africa, Islands States) Governments in middle income Latin America are aware that both donor countries and private investors do not see the region as a priority for mitigation and adaptation funds. Many of countries in the region were early-adopters of the Clean Development Mechanism (CDM) and vocal supporters of international carbon markets in general.  However,  today Latin America represents only 15.7% of all CDM projects while Asia and the Pacific accounts for 80.1%. At present the CDM is unlikely to deliver the low-carbon infrastructure and transformative outcomes Latin America requires. Latin America is unlikely to benefit from international adaptation finance either.  Adaptation finance flows are minuscule and the political priority among donor countries is the least developed countries in Africa and the Small State Islands. The only country in the Western Hemisphere which counts is Haiti. While this is understandable from a political and ethical standpoint, it is dangerous to create the impression that the most vulnerable people in Latin America, for example in Peru, Bolivia and Guatemala, do not also need assistance. Adaptation finance is required in Latin America as well. This May donor countries will disclose the pattern of the fast-start finance disbursements which should shed further light on these issues. Concerns in Latin America about climate vulnerability are revamping climate politics   As data on vulnerability grows and countries experience tragic losses, Latin American leaders are increasingly aware that our infrastructure, communities, and ecosystems are highly vulnerable.   In one evening an entire neighborhood can disappear, in a week annual crops can be lost; a month of heavy rains can harm tourist revenues and so on. The image below documents both the severity and geographical distribution of expected climate impacts. (Source: click here) Latin America’s forceful engagement in the climate negotiations, from Mexico’s hands-on diplomatic strategy, proactive engagement in the Cartagena Dialogue as well as the ‘angry politics’ from countries like Bolivia, illustrate that climate politics in Latin America have moved beyond the REDD and CDM agendas. While REDD+ remains a fundamental priority for many countries, there is a growing realization that climate change must also deal with the central issues of development, competitiveness and inequality. Latin American climate politics have taken many by surprise—especially in the US but also some in the EU and the G77. It will be necessary to find ways of addressing the calls for support accruing from Latin America’s sense of vulnerability without triggering divisive politics with the countries that see themselves as the priority for adaptation finance.  This is not a competition for scarce resources. The challenge is to tackle adaptation finance at the scale needed and create awareness that we are all vulnerable.   For the region, it is the ideal time to deepen the political and policy conversation about the kind of infrastructure needed in the region in the XXI Century vis-à-vis climate impacts and the need to assess how much investment –local and foreign, public and private – must be deployed and how.   Despite the “squeeze” (and partly because of it), Latin American middle-income economies are showing unprecedented willingness to experiment with low-carbon growth models We need to transform our energy, transport and agricultural systems, amongst others, and we need to demonstrate it is possible for developing countries to continue growing while reducing emissions and building resilience to climate change. Simply put, the “low-carbon transformation” needs champions that demonstrate its feasibility on the ground.  In order to do that, we need to (a) boost experimentation (building low-carbon prototypes), (b) promote replication (test the prototypes in other countries, draw lessons, adjust for local conditions) and we need to scale up the models that work in practice (going from support for specific transformative projects to financing sector and economy-wide initiatives). Middle-income economies are becoming much-needed laboratories for low-carbon experimentation.  Due to a certain degree of development and economic resilience, these economies are more likely to pioneer low-carbon prototypes that work in practice than other economies that are still struggling to develop. Countries such as Chile, Colombia, Costa Rica, Peru, and Mexico are adoptinglow-carbon strategies most pragmatically.  The Costa Rican or Colombian economies are relatively low-carbon and they want to remain so in the future if the right incentives are in place. The larger developing economies such as China, India, and Brazil are embracing a political strategy that aims to turn them into powerful G20 nations. Even if these emerging global players develop low-carbon prototypes, how much of it will be ‘replicable’ given the scale of their markets (India), their institutional fabric (China) or their vast natural resource endowments (Brazil)? Consequently, the niche for middle income economies is 'replicability'. Low-carbon prototypes from Colombia or Peru—or their cities—are likely to become useful references for developing country peers that aim to remain low-carbon economies in the future.   Mexico City is already learning lessons from Bogota, Colombia, in the area of low-carbon transport.  And Turkey is finding that lessons from Mexico are appropriate for Istanbul. Within the context of the negotiations, many of these middle income economies have left behind the argument that engaging in low-carbon development strategies equals conditionality. Instead, they argue that access to climate finance will be critical for them to avoid switching away from low-carbon growth strategies. The region has used loans for many decades often for building high-carbon infrastructure. The difference today is the availability of loans for de-carbonization purposes.  As these countries borrow, they provide valuable lessons on what works, what does not and why. Mexico’s and Colombia’s low-carbon investment plans are arguably the closest we have in the region to building mitigation prototypes that aim to achieve transformative outcomes. These loans are far from achieving the scale of the transformation that is needed in the region to lock in a -1.5 degree pathway, but they provide valuable insights for climate finance. Experimenting with low-carbon lending illustrates initial attempts in Latin America to merge the infrastructure debate with the climate agenda, which creates a new basis for defining low-carbon, climate resilient plans – for the economy and if not, at least for specific sectors or cities.   China’s role in Latin America may push the region towards greater carbonization   Gone are the days when Latin America only looked to the United States as their principal economic partner. In 2009 China bought $44bn worth of Latin America’s exports representing 10 times more than in 2000.  China is also engaging in multiple bilateral cooperation agreements ranging from building infrastructure across the region to partnerships with leading corporations such as Brazil’s Petrobras. The case of China and Chilean cooper is worth considering. In the coming decades China will build 221 cities whose electric infrastructure and cars especially hybrids will need copper. In 25 years, China is expected to demand 3 times the amount of copper (19.3 million metric tons) it demands today (5 million metric tons). The world will need more copper in the next 20 years than has been extracted in the last 110 years. To meet increasing Chinese demand, Chile will need to first tackle its current energy crunch and do so at competitive prices without pushing buyers away.  The environmental consequences of supplying cooper to China at that scale, which may require carbon intensive desalinization plants in order to make water available for mining, pose difficult choices. Those sectors benefiting from the Chinese boom may oppose climate action on the basis that it may harm profits. National debates that consider the longer-term benefits for building resilient and low-carbon infrastructure, which go beyond business as usual thinking, will be imperative. As Latin America consolidates as a middle-income region, one hopes citizens will also demand higher quality of life standards –not simply easy growth at any expense. Locking-in the climate momentum   Latin American middle income economies do matter in climate politics because of their new role in the negotiations as champions of the constructive middle-ground and of their low-carbon experimentation efforts. No longer is the region restrained to being just a “REDD player.” But this new momentum on climate must be locked-in by creating larger national low-carbon coalitions.  The engagement of local business investing in low-carbon projects and local governments pushing for low-carbon and resilient cities is critical.  A low-carbon urban agenda will be key in bringing citizens on board. This agenda will be locked in politically and culturally when it emerges as a stronger driver of quality of life.   This article is based on a presentation made by the author at the Brown University April 8th 2011 Conference on “Latin America and Climate Change: Regional Perspectives on a Global Problem”.
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Monica Araya

Dr. Mónica Araya is Costa Rican expert on climate and low-carbon development who has worked on sustainability issues for over 20. She is Founder and Director of Costa Rica Limpia - a citizen platform to advance new thinking on environment, development and democracy. She was negotiator for her country in the climate negotiations. She collaborates frequently with leaders in government, business, academia, non-profits and think tanks in several countries. She is a member of the Steering Committee of the UNEP Emissions Gap Report and Co-Chair of the
Latin American LEDS Platform. She obtained a Masters in Economic Policy at Universidad Nacional in Costa Rica and Master and Doctorate in environmental management from Yale University.
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La Dra. Mónica Araya es una experta costarricense en cambio climático y desarrollo bajo en carbono. Es Fundadora y Directora Ejecutiva de Costa Rica Limpia, una plataforma ciudadana para promover nuevos planteamientos en desarrollo, ambiente y democracia. Ha sido negociadora por su país, Costa Rica, en las negociaciones del clima. Colabora regularmente con líderes en el sector gubernamental, empresarial, academia, entidades sin fines de lucro y think tanks en varios países. Es miembro del Comité Directivo de la PNUMA Emissions Gap Report y Vice Presidenta del Comité Directivo de la Plataforma Latinoamericana LEDS. Obtuvo una Maestría en Política Económica de la Universidad Nacional de Costa Rica y una Maestría y Doctorado en gestión ambiental en la Universidad de Yale.
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