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From ‘Berlin’ to ‘Kyoto’—Negotiations Under the Berlin Mandate

Between August 1995 and December 1997, the AGBM met eight times to negotiate a protocol or other legal instrument for a post-2000 climate policy. Similar to the process leading to the UNFCCC, also the first AGBM negotiation sessions were focused on procedures and principles before countries[1] actually began drafting a legal document. Especially the notion in the Berlin Mandate that the negotiations were to take place in the light of best available scientific information led to considerable confusion. Some countries proposed to assess available information first in the AGBM context before starting the actual negotiations, whereas others believed that the assessment and the negotiations could, or even should, be carried out in conjunction. Eventually, countries decided in favour of the latter option, but when time was running out towards the deadline at COP-3 in 1997, countries mainly focussed on negotiation dynamics and less on the (scientific) information which could feed the negotiation process.

Despite the agreement at COP-1 not to focus on new commitments for developing countries, this remained a pending issue throughout the AGBM process. For example, voluntary targets or packages of policies and measures were suggested by developed countries to be adopted by developing countries. According to US President Clinton, when he announced the US proposal for a protocol or other legal instrument[2] in 1997, developing countries should ‘meaningfully participate’ in international climate policy. At AGBM-2 (Geneva, Switzerland, October- November 1995), the US delegation quoted the recently presented IPCC SAR, which concluded that the “balance of evidence suggests a discernible human influence on global climate” (IPCC 1995), to argue that already in the first half of the twenty-first century, absolute greenhouse gas emission levels in developing countries would become higher than those of developed countries (IISD 1995c).

Developing countries felt that the US proposal and its rationale were a direct violation of the Berlin Mandate and a clear attempt to shift the focus of the AGBM to a discussion on emission reduction commitments for developing countries too. The group was particularly critical on the fact that the US delegation seemed to disregard historical, structural differences between countries on a global scale and argued that these differences had precisely formed the basis of the principle of common but differentiated responsibilities in both the UNFCCC and the Berlin Mandate. They rejected any claim from developed countries that new scientific information from IPCC had changed the background for negotiations after COP-1 and argued that there was no need to adjust the Berlin Mandate accordingly.

In this discussion, the European Union (EU), unlike countries such as New Zealand and Australia, did not support the USA. The EU focussed strongly on

Fig. 4.1 COP-1 umbrella— still in use by author

formulating sets of policies and measures for reducing greenhouse gas emissions to be adopted by developed and developing countries and held on to its official position taken prior to COP-1 that developed countries should show a considerable climate change abatement effort first before requesting developing countries to also adopt such commitments. Nevertheless, also the EU’s proposal contained elements in the direction of a more active role for developing countries in a future legal instrument. However, instead of shaping this via quantified commitments, the EU’s text described this role in terms of policies and measures, such as energy efficiency, production standards, and labelling. On the latter, the EU distinguished three types of activities: mandatory policies and measures for developed countries; voluntary action by developing countries; and certain measures that all countries would have to carry out.

One effect of the debate on the participation of developing countries in a Protocol was that the splitting of the G-77&China into a ‘Green group’ and the OPEC countries, which happened at COP-1, was repaired during the AGBM process. OPEC countries managed to include on the agenda the topic of compensation for developing countries whose economies strongly depend on income generated from fossil fuel production and exports. The other G-77&China countries generally supported the OPEC countries on this. Eventually, the G-77&China negotiators turned out to be very skilful in avoiding detailed debates on commitments for developing countries, especially at COP-3 when they focussed so much on the issue of emissions trading (introduced by the USA) that, by the end of the session, no consensus could be found anymore for negotiating meaningful participation by developing countries.

Notwithstanding the importance of this topic, most attention during the negotiations was paid to the issues of setting targets/commitments for developed countries and to what extent these could be achieved flexibly in terms of location, timing and inclusion of greenhouse gases other than CO2. In this context, countries discussed a number of options. Some countries proposed so-called flat rate commitments (a similar emission reduction percentage target for all developed countries) with maximum flexibility in terms of:

  • location where emission reductions can be achieved (e.g., trading of carbon credits on emission reduction projects via Joint Implementation, JI, or international trading of emissions quota);
  • timing, with proposals varying from a single compliance year to an emissions budget or commitment period of five years; and,
  • number of greenhouse gases covered, whereby proposals ranged from focussing on CO2 only to baskets of greenhouse gases expressed as CO2-eq.

Other countries proposed differentiated targets, which would reflect structural differences between developed countries. However, there was a long debate on whether such differentiation should be based on a formula with agreed, scientifically supported, criteria or simply be left to the dynamics of negotiations. It was increasingly felt during the AGBM process that differentiation was necessary for reaching agreement, but, as stated by the German delegation at AGBM-6 (March 1997), scientifically derived indicators may not necessarily reflect political reality (see later in this chapter). Hence, in the course of time, countries began issuing proposals with their own quantified targets which had either been scientifically determined, or set as a matter of principle or reflecting domestic political interests. For example, in March 1997 the EU presented its collective greenhouse gas emission reduction target of 15 % (below 1990 levels to be achieved in 2010), which was based on the scientifically determined Triptych Approach (Phylipsen et al. 1998) (see also later in this chapter). The USA, instead, announced in October 1997 that it aimed at stabilising its greenhouse gas emissions during a period of five years (2008-2012) at 1990 levels, which reflected the Byrd-Hagel resolution in the House of Representatives adopted in July 1997 (Byrd and Hagel 1997).

AGBM-3 had already created some openings in the negotiations on a number of key issues in the Berlin Mandate context, such as: quantitative targets for developed countries; differentiation of these targets among countries based on domestic circumstances; policies and measures; participation of developing countries; and flexibility of meeting commitments in terms of location and time. This was followed by considerable progress at AGBM-4, which was held during COP-2 (Geneva, Switzerland, July 1996). Perhaps the biggest achievement of COP-2 was the announcement by the USA that it supported a legally-binding protocol or other legal instrument. Thus far in the AGBM process, the US delegation had submitted proposals on the design of an instrument (cumulative targets, differentiation, multiple gases, etc.), but had never been clear on its legal nature. Note that the US announcement was made at the more political high-level segment of the COP (the Ministerial Segment on 17-19 July 1996), not at the AGBM-4 meeting itself (IISD 1996a).

The USA, however, also called upon other countries to create maximum flexibility in a legal instrument, in order to complement legally-binding commitments. Important elements in the US proposal for flexibility were: a global application of the JI concept for project-based emissions trading and the establishment of an international greenhouse gas emissions trading scheme with participation of countries with quantitative commitments. The latter option was also discussed at AGBM-4 in combination with a flat rate target approach as an alternative to differentiated targets approaches.

Regarding the inclusion of policies and measures in a global climate regime, which former AGBM sessions had basically considered in conjunction with quantified emission limitation and reduction objectives (or QELROs), countries agreed that these should not be overly strictly applied. In fact, countries suggested that differences in national circumstances should be an important factor in deciding which policies and measures to incorporate in national climate policies. There was discussion on whether the COP should define a menu of policies and measures from which countries could choose and whether a limited set of policies and measures should become mandatory for developed countries. Most outspoken in this respect was the US delegation which argued that no single set of policies and measures exists that fits all countries.

The progress made at AGBM-4/COP-2 was reflected by the Geneva Declaration in which the Ministers and Heads of Delegations, among other aspects, stated that, while notifying the principles of common but differentiated responsibilities and precautionary actions, they would “instruct their representatives to accelerate negotiations on a legally-binding protocol or other legal instrument to be completed by COP-3” (IISD 1996a; UNFCCC 1996b).

After AGBM-4/COP-2, AGBM-Chair Raul Estrada called upon country delegates to submit proposals for a legal instrument text, in order to accelerate the drafting of a negotiation text. By its fifth session, also held in Geneva, the AGBM could consider fourteen proposals submitted by countries, including one from the EU as a whole (IISD 1996b). Although the proposal texts still showed a wide range of views on issues such as policies and measures and quantified emission limitation or reduction objectives, it could be observed that negotiations had become more streamlined now that consensus had been reached on the nature of eventual targets as legally-binding commitments. Now, as UNFCCC Executive Secretary Michael Zammit Cutajar said, the time had come to decide which proposals should be set aside or could be considered mutually exclusive, in order to single out a limited number of options to focus on in the final year of the Berlin Mandate process (IISD 1996b).

However, it also became clear at AGBM-5 that the issue of involvement of developing countries had become even more sensitive than before. This was most clearly illustrated by the protest raised by the USA when Chair Estrada presented his draft conclusions of the session and, among others, quoted the Berlin Mandate which specifies that no new commitments for developing countries should be included in a legal instrument (UNFCCC 1995a, p. 5, para. 2b). The USA, but also the EU, did not understand why emphasising this issue was needed (IISD 1996b, p. 7). Nonetheless, at AGBM-5, the USA had somewhat changed its tone by proposing positive incentives for developing countries to join the group of countries with quantitative targets. Also to this proposal the G-77&China replied that developing country participation would only be up for discussion if developed countries showed clear progress towards meeting their stabilisation objectives by 2000 as defined in the UNFCCC (1992, p. 6, Art. 4.2(a)).

In March 1997, when AGBM-6 met in Bonn, which had become the new location of the UNFCCC Secretariat, the EU presented the proposal by the EU Council of Ministers and Heads of State of a common EU emission reduction target for three greenhouse gases (carbon dioxide, CO2; nitrous oxide, N2O; and methane, CH4) of 15 % below 1990 levels to be achieved by 2010. The aggregate target had been differentiated across the EU, using the above-mentioned Triptych Approach,[3] with relatively strong emission reduction targets for, e.g., Germany and the UK and permissible emission increases for several other Member States, e.g., Greece and Portugal. In addition, the EU kept pushing its proposal on policies and measures which it wanted to become legally-binding under a legal instrument to be adopted by AGBM. On this issue, the discussion showed that the EU became increasingly isolated within the negotiations, as also the G-77&China criticised the proposal because of its possibly negative impacts on developing countries (both directly through their envisaged participation in policies and measures schemes in the EU proposal and indirectly through negative trade effects from implementing policies and measures in industrialised countries, such as reducing imports from developing countries). Other countries, such as the USA, Japan, and Australia, repeated their criticism on this issue and/or proposed less strict alternatives.

Despite its specific proposal for a quantitative emission reduction or limitation objective of 15 % for the EU block, which was generally applauded, the EU was not able to ‘steer’ the agenda for the negotiations. On differentiation of targets between countries, the EU had never been very clear, but now it could not oppose the concept anymore as it now had applied a differentiation or burden sharing formula itself. In addition, on emissions trading, introduced in the negotiations by the USA, the EU did not present a clear view, except that it cautioned that international trade in greenhouse gas emission allowances between countries should not lead to postponement of domestic climate change abatement actions in developed countries. Particularly painful for the EU was that Chair Estrada had not copied any of the 200 policies and measures priority options from the EU proposal in his “Framework Compilation of Proposals from Parties for the Elements of a Protocol or Another Legal Instrument” (UNFCCC 1997a).

At AGBM-6 it became clear that countries had generally accepted the principle of differentiation of quantified emission limitation or reduction objectives among countries. As explained above, the EU had applied differentiation internally among its Member States and also the USA agreed on including differentiation as an option in the negotiation text (up to then the US delegation had been in favour of a flat rate target with emissions trading as an instrument to even out cost differences between countries). Countries only had to sort out how to apply differentiation for which basically two options existed: either formalise differentiation using criteria and indicators (formula-based or selective approach), or ‘simply’ leave it to negotiations (negotiation approach). During the AGBM-6 talks, countries slowly seemed to move towards the latter approach, mainly for practical reasons, or, as a German delegate put it: “indicators do not necessarily reflect political reality” (IISD 1997d, p. 7). The proposals submitted to AGBM-6 revealed an increasing preference for a top-down approach with an aggregate target for developed countries to be allocated among them through negotiations.

Perhaps the biggest issue at AGBM-6 was ‘flexibility’: to what extent could developed countries with quantified emission or limitation objectives acquire emission reduction credits from abroad through JI projects (Fig. 4.2) and emissions quota trading between countries? This debate focused largely on the geographical scope for JI and on the extent to which developed countries could apply this flexibility mechanism to comply with their objectives. Several developed countries proposed JI cooperation both among developed countries and between developed and developing countries. The latter was opposed by the G-77&China which even proposed deleting the text on JI from the Chair’s compilation text. Developing countries again urged developed countries to first show demonstrable progress with reaching their stabilisation objectives for the year 2000, as in the UNFCCC (see Chap. 3). The G-77&China and also the EU argued that acquiring emission reduction credits or emission allowances from abroad should not entirely nor largely replace required domestic abatement action in developed countries.

Less than half a year before COP-3 (at AGBM-7 in Bonn, October 1997), negotiations were somewhat overshadowed by the domestic political debate within the USA, which had resulted in a strong support for the resolution sponsored by Senators Byrd and Hagel by the House of Representatives and the Senate (in July

1997, shortly before AGBM-7) (Byrd and Hagel 1997).[4] The Byrd-Hagel resolution stated that “the United States should not be a signatory to any protocol to, or other agreement regarding, the United Nations Framework Convention on Climate Change of 1992, at negotiations in Kyoto in December 1997, or thereafter, which would.. .mandate new commitments to limit or reduce greenhouse gas emissions for the Annex I Parties, unless the protocol or other agreement also mandates new specific scheduled commitments to limit or reduce greenhouse gas emissions for Developing Country Parties within the same compliance period”. Senator Byrd personally contacted AGBM Chair Estrada to explain US domestic objections to unilateral commitments by developed countries.

Although several developed countries in principle supported the US position on ‘meaningful participation’ by developing countries (e.g., the EU wanted developing countries to adopt some greenhouse gas abatement policies and measures), the general view was that preparations for commitments for rapidly growing or ‘ industrialising developing countries’ in a climate regime should not be started within the context of the Berlin Mandate, i.e. ‘yes’ to evolution of developing country participation, but not yet.[5] Consequently, Chair Estrada literally stuck to the Berlin Mandate (‘no new commitments for non-Annex I Parties’) (UNFCCC 1995a) and left the US proposal on ‘evolution’ out of the draft negotiating text.

About a month before COP-3, the negotiations were approaching a climax, particularly because key developed countries had submitted their proposals for quantified emission limitation or reduction objectives. AGBM-8 (Bonn, Germany, October 1997) also made clear that the real negotiations were actually taking place outside the ‘Bonn context’, via bilateral talks through various ‘shuttle diplomacies’. The US delegation visited EU Member States to sort out issues before COP-3, the EU Presidency Trio (with the present, former and incoming presidents of the EU Council of Ministers) met with US government officials and leading senators on the issue of climate change, and Japan, being the host of COP-3, had regular contact with the US administration and EU leaders when submitting its proposal for a legal instrument to AGBM (see below).

Shortly before AGBM-8, US President Clinton had announced the US proposal for a legal instrument on climate change (IISD 1997a, p. 3). It contained a stabilisation target for the USA at 1990 levels for six greenhouse gases to be achieved during the five-year period 2008-2012. In addition, the proposal called upon developing countries to participate in a meaningful way, although it did not refer to an evolutionary process, which at ABGM-7 had turned out to be controversial. Finally, the USA proposed inclusion of JI among developed countries and with developing countries, as well as trading of emission allowances among developed countries.

The G-77&China criticised the US proposal as, in their view, it was in conflict with the Berlin Mandate (based on arguments they had elaborated on at earlier AGBM sessions, see above). Chair Estrada tried his best to find compromises in this respect by suggesting a more general discussion at COP-3 on the future participation of developing countries in quantitative target regimes, but to separate such a debate from the Berlin Mandate negotiations. He also considered including terms of reference for JI cooperation with developing countries in the draft negotiating text, i.e. only projects leading to a transfer of sustainable (energy) technologies to developing countries would be eligible in JI cooperation between developed and developing countries. Moreover, Estrada considered including a paragraph on voluntary participation of developing countries in an emissions trading regime (IISD 1997a, p. 5).

Greenhouse gas certificate issued by Costa Rica based on JI projects in the country

Fig. 4.2 Greenhouse gas certificate issued by Costa Rica based on JI projects in the country

  • [1] Formally, countries negotiate as ‘Parties to the UNFCCC’ or ‘Parties’. However, since Parties,with the exception of the EU, which is a UNFCCC Party in itself, are in fact countries, in theremainder of this chapter, Parties are referred to as countries. For similar reason, in order to avoidtoo formal terminologies, in this chapter Annex I Parties are called developed (or industrialised)countries and non-Annex I Parties are referred to as developing countries.
  • [2] Throughout the AGBM negotiations the legal shape of the negotiation outcome of the BerlinMandate was still to be decided. In their proposals, countries, in conformity with the BerlinMandate, referred to ‘a protocol or other legal instrument’, In the remainder of this section, theterm ‘legal instrument’ will be used unless countries specifically mentioned ‘protocol’ (IISD1995-1997).
  • [3] The Triptych Approach was developed by the University of Utrecht (Phylipsen et al. 1998) andwas based on historical and projected emission trends in three different (categories of) sectorswithin the EU: the power sector, internationally-operating energy-intensive industry, anddomestically-oriented sectors.
  • [4] The Byrd-Hagel Resolution was sponsored by Senator Robert Byrd (Democrat, West Virginia)and Senator Chuck Hagel (Republican, Nebraska) and expressed the sense of the Senate regardingthe conditions for the US becoming a signatory to any international agreement on greenhouse gasemissions under the United Nations (Passed by the Senate 95-0) (105th CONGRESS 1stSession S. RES. 98) (Byrd and Hagel 1997).
  • [5] Of the developing countries, Brazil proposed at AGBM-7 that in the future all countries shouldadopt commitments (IISD 1997c, p. 3).
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