Climate Change Information sheet 29
Global cooperation on technology
- Climate change is a global problem that requires a global solution. Developed countries account for the largest part of historical and current greenhouse gas emissions; their share for 1994 was about 75% of the global total. However, while per-capita emissions in developed countries are likely to stabilize (at well above the world average), developing-country emissions continue to rise steadily and are expected to represent some 50% of the global total before the year 2025.
- Developing countries will need access to climate-friendly technologies if they are to limit emissions from their growing economies. Such technologies are essential to establishing a low-emissions industrial infrastructure. Under the Climate Change Convention, the richest countries (essentially the OECD members) agree to "take all practical steps to promote, facilitate, and finance, as appropriate, the transfer of, or access to, environmentally-sound technologies and know-how to other Parties, particularly developing country Parties, to enable them to implement the Convention".
- Technology can be transferred through several different channels. The traditional channel has been bilateral and multilateral development assistance in the form of export credits, insurance, and other trade support. Incorporating climate change considerations into the programmes of national development offices and multilateral development banks would greatly increase the transfer of low-emissions technologies. The Convention also provides for two new channels. The first is the government-funded Global Environment Facility (GEF). The second is "Activities Implemented Jointly", or AIJ, which seeks to attract private sector funds for the transfer of technology and know-how to developing countries and countries with economies in transition. The Convention emphasizes that these two new channels must add to, rather than replace, traditional development assistance.
- The GEF has a critical role to play in the co-development and transfer of advanced technologies. The GEF supports both the development and demonstration of technologies that can improve economic efficiency and reduce greenhouse gas emissions while promoting sustainable development in developing and transition countries. GEF projects can be used to demonstrate the technological feasibility and cost-effectiveness of renewable energy technologies and energy efficiency options. In these cases, the GEF pays the added cost of introducing a climate-friendly technology in place of a more polluting one.
- Activities Implemented Jointly has been conceived as one way of channeling private-sector money into climate change activities. If successful, AIJ could promote the co-development of advanced technologies and their transfer from developed countries to other parts of the world. These technologies would need to be appropriate to local circumstances, environmentally sound, and economically competitive. AIJ is carried out through partnerships between an investing company in a developed country and a counterpart in a host country (which could be developed, developing, or in transition to a market economy). The investing partner is expected to provide most of the required technology and financial capital. The host-country partner may provide the site, the principal staff, and the organization needed to launch and sustain the project.
- AIJ is currently being tested through a pilot phase that will end by 1999. Proponents argue that AIJ can reduce global emissions cost-effectively, as reducing a given quantity of emissions may be cheaper in many developing and transition countries than in some developed countries. Skeptics are concerned that AIJ will not only transfer technology but - contrary to the spirit of the Convention - the responsibility for combating climate change from developed to developing countries. Under the pilot phase, the investing country does not receive credits for the emissions it helps to reduce in another country, although supporters of the concept emphasize the importance of a credit system if AIJ is to achieve its full potential. Other issues include how to structure the reporting and regulatory regime and how to prevent the transfer of uncompetitive and inappropriate technologies.
- Technology transfer must be accompanied by capacity building. The delivery of new hardware alone rarely leads to "real, measurable and long-term environmental benefits" in the host country. In many cases it is absolutely essential to strengthen existing local institutions. This includes building managerial and technical skills and transferring the know-how for operating and replicating new technological systems on a sustainable basis. Without such preparation, advanced technologies may fail to penetrate the market. Capacity building also has a role to play in ensuring that new technologies are, in the words of the Convention, "compatible with and supportive of national environment and development priorities and strategies, (and) contribute to cost-effectiveness in achieving global benefits".
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