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The Green Business Verdict on the Cancun Agreements

First the caveats. Any diplomats waking up following the dramatic final night of negotiations at the Cancun Summit feeling a warm glow of pride at a job well done would be wise to remind themselves that there remains a gaping chasm between the actions required to effectively tackle climate change and the actions promised in the vaunted Cancun Accords.

You know there is something badly wrong with a situation when you find yourself in agreement with Bolivia's socialist firebrands. But when the country's climate envoy, Pablo Solon, refused to bow to pressure and issued a statement arguing the Cancun Agreement was "disastrous for humanity" because it would still allow for temperature rises of up to 4 degrees Celsius, it was hard not to nod along.

The latest scientific updates get scarier by the week and the global response is still woefully inadequate. Moreover, critics are right when they point out that a deal was only reached after virtually every single contentious issue was kicked into the long grass of next year. There may have been the outline of a compromise deal on the monitoring, verification and reporting (MRV) of greenhouse gas emissions, but there is no indication of how long-term climate finance will be raised, no start date for new forestry protection measures, no timeline for reforms to the carbon market.

Most crucially of all,there is no evidence that countries will agree to more ambitious emissions targets and no end in sight to the central stand-off over the future of the Kyoto Protocol. Every single one of these unresolved issues has the potential to scupper the main summit in South Africa next year and leave the world without any meaningful international climate change deal in place from 2012 onwards.

And yet it is hard to agree fully with the Cassandras today accusing governments of spinning Cancun's failure as a success -- they may not have gone far enough, but last week's talks have delivered significant and encouraging progress.

Ahead of the summit British government officials listed five areas that would determine whether Cancun was a success or failure: Whether emission pledges made in Copenhagen would be brought into the U.N. process; whether an MRV mechanism could be agreed; whether a new green climate fund would be launched; whether there would be a deal to tackle deforestation; and whether there would be progress on technology transfer.

Privately officials admitted that getting tangible progress on three out of these five areas would be a good result -- in the end they got progress on all five.

More significantly still, the agreements not only confirm that governments will continue to pursue the various emission reduction plans set out in last year's Copenhagen Accord, they also acknowledge for the first time that these plans are not ambitious enough and that bolder targets or additional measures will be required to close the "gigaton gap" between what has been pledged and what is needed.

The direction of travel is clearer than it has ever been, the international consensus (with the exception of Bolivia) is stronger than ever, and the mechanisms to deliver deep emission cuts are beginning to take shape.

Mark Kenber, deputy CEO at the Climate Group think tank, observes: "Cancun sends a clear message to businesses that this is not going to go away... it confirms there will be public sector support for leveraging private investment, which means there will be opportunities for the private sector. After Copenhagen people were asking if this was ever going to happen; Cancun shows that it is happening."

Naturally, there are still plenty of concerning issues surrounding the agreements and in many ways those hailing them as a full-blown triumph are as misguided as those labelling them a disastrous failure.

The final texts from Cancun are littered with loopholes and the chances of a new all-encompassing international treaty being agreed before the first phase of the Kyoto Protocol expires remain somewhere between slim and vanishingly slim.

Opposition in the U.S. Congress means that, barring a Democrat landslide of unprecedented proportions, there is no way a new international treaty will be ratified even if a draft agreement can be finalised in South Africa. We are more likely to end up with a semi-binding agreement to curb emissions than another treaty in the Kyoto mold, which raises the prospect of furious developing countries storming out of the talks.

Equally, industrialised nations have little problem agreeing in principle that they should provide $100 billion (£63.42 billion) a year in climate financing from 2020, but it remains to be seen if they will prove quite so committed to the concept once the details are finalised and they have to stump up.

And yet there is no doubt the agreements reached early on Saturday morning exceed the best that could have been hoped for even 24 hours beforehand. One British official hailed the deal as the most important international climate agreement since Kyoto -- it is hard to argue with him.

The talks now have some much-needed momentum going into next year and a number of crucial emission-cutting mechanisms, such as REDD, the Green Fund, and new financial support for CCS, should emerge over the next few years. More importantly still, the agreements for the first time make a clear reference to delivering sustainable economic growth and as such progressive green businesses can invest with greater certainty than ever before that governments will deliver the support they need.

In fact, the most disappointing aspect of Cancun is the sad reality that the media's fixation on bad news over good means the summit will not enjoy a fraction of the coverage enjoyed by last year's Copenhagen Summit. Businesses that fail to pay close attention to the ongoing negotiations will have heard the talks failed last year, but may not have picked up that, thanks to the exemplary management of the Mexican government, they were put back on track 12 months later.

It is now up to the U.N. climate secretariat, lead negotiators, NGOs and green businesses to broadcast Cancun's central message far and wide: regardless of the potential legal pitfalls, the negotiations have been revitalised and the world's governments are, publicly at least, more committed than ever to building a low-carbon economy.

This article originally appeared on BusinessGreen, and is reprinted with permission.

Photo CC-licensed by UNFCCC.

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