At the Group of 20 (G20) meeting in Pittsburgh last week, the world's largest economies agreed to end subsidies for oil, coal and other fossil fuels that produce greenhouse gases and contribute to global warming, but failed to move ahead on offering financial aid to developing countries that are already feeling the effects of climate change.
The $300 billion spent every year on subsidies worldwide actually accelerates global warming by keeping prices artificially low and increasing demand for fossil fuels. Phasing out the subsidies between now and 2020, as the G20 nations intend, would decrease global greenhouse gas emissions 10 percent by 2050.
By punting temporarily on providing "climate change" money to poor countries, the G20 leaders renewed concerns that they may lack the commitment to achieve a meaningful international pact to slow global warming when they meet with other nations at the United Nations Copenhagen climate conference in December. Yet, in a joint statement, the G20 leaders pledged to increase their efforts to reach an agreement this year. They also asked their finance ministers to develop a variety of climate-related financial aid strategies for them to consider at their next meeting.
The subsidy decision was seen as a victory for U.S. President Barack Obama, who had urged the other G20 leaders to drop the billions of dollars in tax breaks, low-interest loans and other subsidies many nations offer to energy companies. Naturally, the president had good things to say about the new strategy.
"This reform will increase our energy security ... and it will help us combat the threat posed by climate change," Obama told reporters after the two-day summit. "All nations have a responsibility to meet this challenge, and together we have taken a substantial step forward in meeting that responsibility."
Energy producers reacted as though ending fossil-fuel subsidies would also end life as we know it, leading to both higher prices and higher taxes. On the other hand, environmental groups offered qualified praise for the move, warning that world leaders should not allow the positive step of lowering greenhouse gas emissions by eliminating oil subsidies to distract them from helping poor countries that are struggling to mitigate the effects of global warming.
The mixed outcome of the G20 meeting on climate issues was perhaps best summarized by European Commission President Jose Manuel Barroso: "I do not hide my concern at the slow rate of progress. Negotiations cannot be an open-ended process. It's time to get serious now, not later."Also Read: