Business Expectations Low Ahead of UN Climate Talks
<p>A new report from Ernst & Young outlines the contextual backdrop of the upcoming climate talks in Durban, South Africa. Expectations are low.</p>
Is there hope that an international climate change deal will emerge at the upcoming U.N. negotiations in Durban, South Africa?
Don't hold your breath, many business leaders might tell you.
That's not to say one isn't needed. The vast majority of business executives in a recent survey -- 83 percent -- view a multi-lateral climate change agreement as a prerequisite to address the issue, but just 13 percent believe it will happen in Durban -- or anytime soon.
The down economy complicates the upcoming talks, according to the new report from Ernst & Young, "Durban Dynamics: Navigating for progress on climate change." The report offers a nice primer of the contextual backdrop of the negotiations, which are scheduled to run Nov. 28 through Dec. 9.
One of the major factors that promises to stymie the talks is the persistently terrible economy. Climate change efforts will suffer as a result, with the report finding that current austerity measures will leave a big gap in the amount of funding devoted to mitigation.
The U.S., for example, will spend about $2 billion less on climate change efforts between 2011 and 2015, compared to 2010. Overall, 10 large economies tracked in the report will spend $22.5 billion less on climate change in the coming years than historical levels.
While governments are pulling back on funding, business leaders are more bullish, the report found. E&Y surveyed more than 300 business executives and found that 88 percent said their sustainability spending has stayed the same or grown over the past year. More than half indicated that a climate deal provide lots of opportunities for business, but prospects are dim.
The report also addresses many lingering questions surrounding the Durban talks, including the fate of the Kyoto Protocol, the existing climate change agreement that ends next year. The U.S. and developing countries are not bound under Kyoto to reduce their emissions.
E&Y gives a relatively positive spin to the future of global carbon markets should parties fail to produce a successor to the Kyoto Protocol. The largest player is the European Union Emissions Trading Scheme (EU ETS), The world's biggest cap-and-trade program was created to help European nations meet their Kyoto commitments.
"Although the prospects of a global carbon deal will recede in the absence of a successor to the Kyoto Protocol," the report said, "carbon trading will continue as long as there is demand and a market for it."
Image CC licensed by Flickr user CIAT International Center for Tropical Agriculture.