Ambassador Ronaldo Mota Sardenberg
Minister of Science and Technology
Rio de Janeiro, 25/10/2000

It is with great satisfaction that I return here to participate in the Seminar on Climate Change. This meeting is one of a sequence of initiatives that is stimulating the exchange of ideas and contributing to the national debate. I would therefore like to thank Professor Pinguelli Rosa for the invitation, and offer my congratulations for this opportunity for reflection organized by COPPE, which has played a constant role in discussions of issues of great interest to the country.

Importance of the issue

I would like, first, to discuss initiatives within the Government to coordinate actions related to Global Climate Change, through the Interministerial Commission on Global Climate Change, that I have the honor to serve as Chair, and which also has as its vice-Chair, Minister Sarney Filho, as well as representation of Ministers responsible for all the sectors affected.

The Interministerial Commission has been working towards creating a better coordination of Brazilian positions and government initiatives related to the issue. In addition, it is the responsibility of the Commission to ensure the incorporation of considerations linked to the problem of climate change in public policies of all relevant sectors, including energy, transport, agriculture, forestry, industry and waste treatment, and in the future will have responsibility for examining and giving governmental approval to projects under the Clean Development Mechanism.

I wish to take this opportunity to give you an update on international negotiations under the United Nations Framework Convention on Climate Change and our next steps.

As a measure of the interest and seriousness that the Government accords to the problem of global climate change – which in Advance Brazil was linked to social and sustainability dimensions – President Fernando Henrique Cardoso has personally been following our participation in the international negotiations.

Last year, I participated in the consultation meeting of Ministers responsible for the issue of climate change in Warsow, in Poland, and following that in the Fifth Conference of the Parties, in Bonn.

This year, I have participated in the Ministerial consultation meeting in New York and in the Netherlands. In the process of consultation and reaching an understanding, I received here in Brazil the Deputy Prime Minister of the United Kingdom, John Prescott, the Chairman of the Fifth Conference of the Parties, Minister Jan Szyszko; and the Dutch Minister J. R. Pronk, who will chair the Hague meeting. In the last ministerial meeting I had bilateral contacts with the representatives of China, India, the European Union and the United Sates, along with the Nigerian Minister Daura, who currently is Chair of the Group of Seventy-Seven plus China.

On these occasions I had the opportunity to underline the importance that the Brazilian government accords to the entry into force of the Kyoto Protocol and the success of negotiations over this year, that will culminate with the Sixth Conference of the Parties to the Convention, in the Hague this November, by which time we expect to have concluded the regulations of the mechanisms of the Kyoto Protocol in accordance with commitments of the countries listed in Annex I of the Convention.

Historical background

This is one more step in a long process of negotiation of commitments under the Climate Convention, whose central objective is the establishment of a regime for not only sharing the obligations associated with the measures necessary to limit or mitigate climate change resulting from the anthropogenic emissions of greenhouse gases, but also the obligations associated with the necessary adaptation of our model of development to these changes.

The negotiating process began in 1990 with a decision by the General Assembly of the United Nations that established the Intergovernmental Negotiating Committee for a Convention on Climate Change. The decision was based on the recommendation of the Intergovernmental Meeting called to analyze the implications of the conclusions of the First Assessment Report of the Intergovernmental Panel on Climate Change and the results of the Second World Climate Conference, both of which occurred in the same year.

As a result, in 1992 the United Nations Framework Convention on Climate Change was adopted and open for signatures during the United Nations Conference on Environment and Development, held in Rio de Janeiro.

The Convention stipulated that in the year 2000 the industrialized countries, listed in Annex I, should return their net anthropogenic emissions of greenhouse gases to 1990 levels, which in fact did not occur.

It also determined that, independently of whether countries comply with this provision, the First Conference of the Parties would evaluate the adequacy of these commitments, which was done in 1995 in Berlin. The decision, known as the Berlin Mandate, considered that the stabilization commitment was not adequate, and therefore launched a new negotiating process, lasting for a period of two years, in order to establish emissions reduction goals that went beyond simple stabilization.

The Berlin Mandate repeated the provisions of the Convention itself, as a result of the principle of common but differentiated responsibilities of countries, meaning that the greater responsibility of industrialized countries requires that they take the initiative to reduce their emissions, and that developing countries need to increase their emissions to meet their development requirements and attenuate poverty.

The negotiating process created by the Berlin Mandate resulted in the adoption in 1997, at the Third Conference of the Parties, of the Kyoto Protocol, which left various important issues open to be resolved later through regulations.

Based on the decision of the Fourth Conference of the Parties, in Buenos Aires in 1998, the agenda of the Hague meeting is principally focussed on completing tasks set out in the Buenos Aires Action Plan. These tasks include regulating certain aspects of the Kyoto Protocol, as well as specific aspects of the Convention itself, especially issues related to technology transfer and special consideration for countries particularly sensitive to climate change and mitigation measures for impacts in these countries.

In terms of regulations for aspects of the Kyoto Protocol, the most important are those related to the emission compensation mechanisms and compliance instruments. Although it is not stated directly in the Buenos Aires Action Plan, negotiators have been giving special attention to the treatment to be given by countries in Annex I (of the Convention) and Annex B (of the Protocol) to articles referring to land use, land use change and forestry, related to meeting their quantified emission limitation and reduction targets.

Also included in the agenda of the Subsidiary Body for Scientific and Technological Advice of the Convention was consideration of the scientific and methodological aspects of the Brazilian Proposal.

Participation of the scientific community

I am very pleased to report that the scientific community has consistently responded to the call by the Government to collaborate in the work of the Intergovernmental Panel on Climate Change. The structure of the Panel is unprecedented and is of great importance in providing the best and broadest access to scientific knowledge about global climate change.

The Panel unites the involvement of scientists in their individual capacity – bringing their knowledge and reputation among their peers for the work they have carried out – with the government review process, created to prevent governments from using the Panel to unilaterally promote their own interests.

It is the expectation of the Government that the list of Brazilian scientists willing to help in the assessment process carried out periodically by the Panel be even larger. They will be invited by the Coordinators of the Panel according to their curricula vitae.

Scientific aspects of the Brazilian Proposal

You will remember that in 1997 the Brazilian government presented a proposal to the Ad-hoc Group on the Berlin Mandate, according to which each country in Annex I would assume emissions reductions commitments in Kyoto, such that the burden on its economy would be proportional to the respective contribution to global climate change, estimated objectively according to the fraction of the rise in global average temperature resulting from its emissions.

The adoption of this objective approach has politically important effects, since it allows the attribution of responsibility to countries to be made, not based on causes – the emissions – but on the consequences – the effective increase in temperature. As is widely known, there is a difference of many decades between emissions and temperature increases. Therefore there is a clear interest for Brazil, as well as to China, India and other countries whose industrialization occurred later, that this methodology be adopted.

since it allows the attribution of responsibility to countries to be made, not based on causes – the emissions – but on the consequences – the effective increase in temperature. As is widely known, there is a difference of many decades between emissions and temperature increases. Therefore there is a clear interest for and other countries whose industrialization occurred later, that this methodology be adopted.

This approach allows us to modulate and benchmark the inevitable process of consideration of the responsibilities of all, and of each country.

Thus, in preparation for the next steps in the Kyoto progress, I would like to repeat the invitation to the scientific community to participate in this effort to analyze the scientific aspects of the Brazilian Proposal.

Regulation of the emissions compensation mechanisms of the Kyoto Protocol

The Brazilian government has been relatively successful in the negotiations in seeking to establish, at The Hague, the Executive Board of the Clean Development Mechanism, which the responsibility of defining the baseline from which emissions reductions will be accounted for and certified.

It is also important that this Board, which Brazil has already indicated its desire to join, be the body that will certify emissions reductions, in order to avoid the conflict of interest that would necessarily result if each of the sponsors of each project could obtain certification from private bodies.

We also support the extension to other compensation mechanisms between Annex I countries, of the provision in the Clean Development Mechanism that a fraction (to be defined) of the resources that circulate by means of transfer of emissions reductions certificates be allocated to a fund. This fund would be destined to activities of adaptation to global climate change in developing countries.

The widespread opposition on the part of Annex I countries to this provision is noted, but there is always the possibility that it could come to be accepted as part of a package for general negotiations.

The Brazilian government supports the position that although the results of the compensation originating in the three mechanisms of the Protocol could be equally used by Annex I counties, the associated certificates each have their particular legal basis, and therefore their fungibility is limited by their legal character.

Supplementarity in the use of compensation mechanisms

The issue of the so-called supplementarity, in the use of the Protocol’s compensation mechanisms by Annex I countries, relates to ongoing discussions about whether the provisions of the Protocol calling for the majority of emissions reductions to be made within the countries themselves, should be implemented through a quantitative limit on the use of compensation mechanisms. This discussion should be in the agenda for negotiations at the Hague.

There are strong links between this issue and the treatment of the sector of land use, land use change and forestry by Annex I countries, along with the possibility of a financial contribution with an a priori value set per tonne of carbon per year, as a compliance mechanism.

These three issues all have a direct and predictable impact on the estimation of the burden, and there are already initiatives under way to consider them in an integrated manner.

The Brazilian government supports the use of a financial contribution as a compliance instrument, in accordance with what was originally proposed in 1997 in the form of the Clean Development Fund, which led to the creation of the Clean Development Mechanism.

It also supports the adoption of strict principles for consideration of the sector of land use, land use change and forestry on the part of Annex I countries.

It is possible that the combination of these elements will result in sufficient guarantees to meet the requirements of the two positions in the negotiation of the issue of supplementarity. On the one hand, there are countries interested in the absence of quantitative limits for the use of compensation mechanisms to limit their obligations; and on the other hand are Parties interested in imposing such limits so that others cannot avoid taking real emissions reductions measures within their own borders.

of the issue of supplementarity. On the one hand, there are countries interested in the absence of quantitative limits for the use of compensation mechanisms to limit their obligations; and on the other hand are Parties interested in imposing such limits so that others cannot avoid taking real emissions reductions measures within their own borders.

Compliance instruments

The consideration of compliance instruments also involves important issues, because in the future they will likely be applied to all countries, and not only those that have quantified emission limitation and reduction objectives in the first commitment period of 2008-2012.

It is important that the compliance regime be maintained under the political control of the Parties to the Protocol, and ensuring that the power to make decisions that affect countries not be handed to technical bodies.

It is also necessary to separate the problem of compliance with the quantified emission limitation and reduction objectives of Annex I countries from the simpler problem of verification of the emission reductions in activities of projects under the Clean Development Mechanism. In this latter case, if there are no emissions reductions, they simply will not be certified by the Executive Board of the Mechanism, and will not be submitted for consideration of the body responsible for the compliance regime.

Land use, land use change and forestry

The manner in which Annex I countries deal with the sector of land use, land use change and forestry is particularly interesting because of the fact that activities of this sector could potentially reduce compliance costs in meeting the quantified emission limitation and reduction objectives, and in some cases, reduce them to zero. This would lead to the perception that the Protocol is being complied with when in reality it has not been.

According to the Kyoto Protocol, the net anthropogenic emissions of Annex I countries in this sector can be counted, limited to deforestation, afforestation and reforestation. Along with this, it stipulates that at some future time, additional activities could be identified, related to agricultural practices in general, with the same objective. There is a limitation in that only activities later than 1990 can be counted.

In general, Annex I countries have been undertaking anthropogenic actions for many decades, which results in the fact that the current statistical distribution of ages of trees in their forests is biased in favor of younger individual trees – that is, their forests are growing.

Therefore the question is raised of whether the removal of carbon because of this growth can be counted or not. Also, there is an indirect effect of the deposition of nitrogen and carbon dioxide fertilization, both of anthropogenic origin, which means that there is a still greater removal of carbon from the atmosphere.

There are also other methodological details that have allowed Annex I countries to deal with the sector in an inappropriate manner, and to circumvent the larger objective agreed to at Kyoto, which is the reduction of emissions of Annex I countries by a specific amount.

For these reasons, Brazil supports the adoption of clear principles that should govern the inclusion of the sector of land use, land use change and forestry in the accounting of emissions from Annex I countries, such as the following:

a. Any land-use, land-use change and forestry activity carried out in addition to the commitments made under Article 4.1(d) of the Convention for the purposes of determining compliance of Annex I Parties with their quantitative emission limitation and reduction objectives under the Kyoto Protocol, must not change the global effect of the Kyoto Protocol, which is to mitigate climate change in the first commitment period equivalent to reducing Annex I anthropogenic emissions by sources covered by Annex A to the Kyoto Protocol by an aggregate proportion of at least 5 per cent with reference to their 1990 levels, in accordance with Article 3.1 of the Kyoto Protocol;

b. For the purposes of determining compliance of Annex I Parties with their quantitative emission limitation and reduction objectives, any land-use, land-use change and forestry activity must not result in an increase of anthropogenic emissions by sources minus removals by sinks deriving from the application of removals by sinks of carbon dioxide and indirect nitrogen fertilization effects;

c. In view of the impact of climate change on forests and desertification, forest conservation and rehabilitation of degraded vegetation cover are important climate change adaptation activities, and as such could be included among those activities to benefit from the share of proceeds of the mechanisms of the Protocol intended to meet the cost of adaptation. This is without prejudice to decisions on land-use, land-use change and forestry activities in the mechanisms of the Kyoto Protocol;

d. The rules for the inclusion of land-use, land-use change and forestry activities in the accounting of Annex I countries, for purposes of compliance with their commitments under the Kyoto Protocol, must not imply a transfer of such commitments to a future commitment period;

e. Carbon removed by land-use, land-use change and forestry activities shall be considered as a temporary removal. Any Annex I Party that makes use of such removal to achieve compliance with its Kyoto Protocol commitment shall continue to be responsible for the equivalent emission reduction at the appropriate point in time;

f. In the methodologies to account for emissions by sources and removals by sinks in the land-use, land-use change and forestry sector, no consideration shall be given to the simple presence of stocks of carbon, in line with the provisions of Article 5.2 of the Kyoto Protocol,

g. Any land-use, land-use change and forestry activity carried out in addition to the commitments made under Article 4.1(d) of the Convention for the purposes of determining compliance of Annex I Parties with their quantitative emission limitation and reduction objectives under the Kyoto Protocol, must not change the global effect of the Kyoto Protocol, which is to mitigate climate change in the first commitment period equivalent to reducing Annex I anthropogenic emissions by sources covered by Annex A to the Kyoto Protocol by an aggregate proportion of at least 5 per cent with reference to their 1990 levels, in accordance with Article 3.1 of the Kyoto Protocol;

h. For the purposes of determining compliance of Annex I Parties with their quantitative emission limitation and reduction objectives, any land-use, land-use change and forestry activity must not result in an increase of anthropogenic emissions by sources minus removals by sinks deriving from the application of removals by sinks of carbon dioxide and indirect nitrogen fertilization effects;

i. In view of the impact of climate change on forests and desertification, forest conservation and rehabilitation of degraded vegetation cover are important climate change adaptation activities, and as such could be included among those activities to benefit from the share of proceeds of the mechanisms of the Protocol intended to meet the cost of adaptation. This is without prejudice to decisions on land-use, land-use change and forestry activities in the mechanisms of the Kyoto Protocol;

j. The rules for the inclusion of land-use, land-use change and forestry activities in the accounting of Annex I countries, for purposes of compliance with their commitments under the Kyoto Protocol, must not imply a transfer of such commitments to a future commitment period;

k. Carbon removed by land-use, land-use change and forestry activities shall be considered as a temporary removal. Any Annex I Party that makes use of such removal to achieve compliance with its Kyoto Protocol commitment shall continue to be responsible for the equivalent emission reduction at the appropriate point in time;

l. In the methodologies to account for emissions by sources and removals by sinks in the land-use, land-use change and forestry sector, no consideration shall be given to the simple presence of stocks of carbon, in line with the provisions of Article 5.2 of the Kyoto Protocol,

The dynamics of the negotiations

The negotiations regarding climate change are conducted through political blocs, organized in accordance with the convergence of interests between the countries. This organization is absolutely essential in reaching consensus among the more than 159 delegations participating in the Conference of the Parties.

The principal negotiating groups are the European Union, the Umbrella Group, consisting of the non-European members of the Organization for Economic Cooperation and Development (OECD) and the countries of the ex-Soviet Union, the Group of the 77 and China (bringing together the developing countries), and the new Environmental Integrity Group, led by Switzerland.

In addition, in specific issues, other groupings tend to emerge within the principal groups and, in some cases crossing the boundaries of the groups. This category includes the Alliance of Small Island States, the Organization of Petroleum Exporting Countries, and the Least Developed Countries.

There is also, and without any formal structure, a natural tendency towards agreement between countries of different groups around very specific interests:

• The forested countries, which include the Russian Federation, Canada, the United States, Australia, New Zealand, Brazil, Finland and Sweden, among others.

• Certain small countries, such as Costa Rica, Bolivia and others, led by Bolivia, that support ways to increase international assistance that they can obtain in the short term, without broader concerns with the central problem of sharing of obligations, in the certainty that any regime that may be adopted will not affect them.

A certain group of countries that correctly or not are perceived as important stakeholders in the process, tend to participate in all the high level consultations about central issues and consult regularly between themselves. This group is variable, but inevitably includes Brazil, along with the United States, Germany, China, India, the United Kingdom, France, Japan and the Russian Federation, along with one or more African countries, and increasingly including South Africa on a permanent basis.

It is interesting to note that this group corresponds to the current and intended future permanent members of the United Nations Security Council.

There is a group of countries that, while they are not intrinsically perceived as important players from the point of view of their national interests, have played a central role in the negotiations. This group includes Switzerland, Austria and Mexico.

Some countries, because of the quality of their delegates, have been outstanding in the negotiations, as is the case with Argentina, Uganda, Sweden, Antigua and Barbuda, Samoa and Tuvalu. On the other hand, some countries that would be assumed to have a great interest in the negotiations, such as Bangladesh, Pakistan and Egypt, have consistently played a not very significant role.

Decisions are adopted by consensus, which is not an easy task given the complexity of the issues and the great number of interests involved. No rules of procedure have been adopted for the Conferences of the Parties to the Convention. This means that, from a legal point of view, the rules of procedure of the group that created the Convention prevail, that is the rules of procedure of the UN General Assembly.

, which is not an easy task given the complexity of the issues and the great number of interests involved. No rules of procedure have been adopted for the Conferences of the Parties to the Convention. This means that, from a legal point of view, the rules of procedure of the group that created the Convention prevail, that is the .

The recognition of the fact that, at least until now, any decision of the Conference of the Parties is not binding, and is therefore subject to the ratification of the Party, means that absolute consensus is always sought.

Some Parties use this tacit necessity for absolute consensus to obtain advantages in the negotiations. The classic example of this until now, but certainly not the only one, is the Byrd-Hagel resolution in the Senate of the United States, which made ratification of the Kyoto Protocol conditional upon obtaining certain concessions from other countries.

The origin of the Byrd-Hagel resolution, often mentioned in the corridors, is worth noting. Adopted unanimously in the U.S. Senate, it made ratification of the Protocol, which at the time was still under negotiation, conditional on the adoption of quantified emission reduction targets by certain "key developing countries, especially Brazil, South Korea, China, India and Mexico". An analysis of the text leads to the conclusion that there was a set of objectives involved: on one hand, certain interests that were opposed to any measures to mitigate climate change, which were presumably against their immediate, but not necessarily long term interests, but this is something to be judged by the authors; and on the other, considerations associated with obtaining the maximum advantage in the negotiations.

In this context, from the strategic view of one group, proposing conditions known to be unacceptable would have the effect of avoiding any consensus about mitigation of climate change. The strategy of the other group would be to use the position of the first group to maximize the gains in the negotiations, an objective that is always valid in any negotiations under the rules of a zero-sum game.

As in other multilateral negotiations of this kind, non-governmental organizations have an important and not necessarily convergent role. There is a great divide between the environmental and industrial non-governmental organizations. And these differences are becoming more prominent.

Prospects for the negotiations in the Hague

The Sixth Conference of the Parties at the Hague is one more annual conference of the Parties to the Convention. From this point of view, not much is expected of the Conference, because it is recognized that we are involved in a long term negotiating process, as I stated initially. This negotiation will only achieve stability when a global consensual regime is established about how to address the sharing of the burden for climate change mitigation and the burden for adapting to these changes.

On the other hand, there is awareness among the most influential Parties in the process that it is important that the Hague Conference be perceived as a success.

For Brazil, as for China and India, it is important that the Kyoto Protocol has a positive outcome. Its failure would mean re-starting a negotiating process in the near future, in which the conditions would not be as favorable as those established in the Berlin Mandate that generated the Kyoto Protocol.

. Its failure would mean re-starting a negotiating process in the near future, in which .

For other reasons, it appears that other countries also find it important that the Hague Conference be successful. Under these conditions, it is useful to define the criteria of success.

In my view, what we could concretely expect from the Hague is:

1. the creation of the Executive Board of the Clean Development Mechanism and the adoption of its terms of reference, and with Brazil having the right to a seat on this Board;

2. the adoption of minimum rules for the operation of the other emissions compensation mechanisms between Annex I countries;

3. the definition of a body responsible for verifying the rules adopted related to compliance for Annex I countries;

4. the intermediate solution for the current difference in points of view, especially between the European Union and the United States with respect the issue of supplementarity;

5. the adoption of special measures for consideration of the situation of least developed countries; and

6. the acceptance of principles about the sector of land use, land use change and forestry by Annex I countries.

Conclusion

The quest for a greater and continuous coordination with society has guided the actions of the Ministry of Science and Technology (MCT) in this area. We regularly interact with institutions and individuals that have made important contributions in this area.

Since I will participate, in November, in the Sixth Conference of the Parties to the Climate Change Convention, I come to this meeting in the expectation that the discussions that will take place here can contribute to shape and consolidate the positions adopted by the Brazilian government.

We cannot expect developing countries to adopt long term policies and measures to reduce their greenhouse gas emissions – which is the same as saying reduce their expectations for economic growth – unless the industrialized countries, which have the greatest responsibility for global warming, clearly signal their willingness to reduce their emissions.

We need to emphasize the importance of technical and financial cooperation between developed and developing countries, recognizing however that this cooperation cannot be conceived as a way to transfer to developing countries the responsibility for global reduction of emissions and meeting the obligations of the Convention.

Finally, I would like to mention one particularly important aspect to be taken into account in the decision about the burden associated to the adoption of measures related to the climate change issue – the pursuit of sustainable development, that is, development which is environmentally healthy, economically viable and socially just – as a long term goal for humanity, but which must be initiated now.

The basic objective of sustainable development is to expand the well being of human being in equilibrium with the environment. For this reason, the direct and indirect effects of global climate change caused by humanity should be one of our central concerns.

Thank you very much.