“the squeezed middle: why latin america matters for climate politics” dr. mónica araya senior...
TRANSCRIPT
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“The Squeezed Middle: Why Latin America Matters for Climate
Politics”Dr. Mónica Araya
Senior Associate E3G (United Kingdom)Climate Finance Advisor (Government of Costa Rica)
Brown University Conference April 8, 2011
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Five Ideas
Why Latin America matters in context of:1. Climate negotiations2. Climate finance3. Low-carbon pathways
Emerging drivers of climate politics :4. Vulnerability 5. China
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1. Never before, has Latin America been so impactful in the international
climate negotiations
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Cancun took many by surprise
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COP16 put the train back on track
• The Mexican Diplomacy as the ‘surprise’ engineers of consensus
• Christiana Figueres (Costa Rica) brought a fresh, ‘yes, we can’ impetus
• Cartagena Dialogue was most constructive voice in the COP – behind scenes
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The Power of Dialogue
• Cartagena Dialogue as “safe space” for negotiators of 30 plus countries; testing comfort zones– Beyond North-versus- South
• Meetings in Colombia, Maldives, Costa Rica, Malawi – Samoa & Chile forthcoming 2011
• “Block the blockers” – Counterbalance to polarizing countries
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2. Latin America is “squeezed” in the middle; the region is insufficiently large and powerful (Asia)
and insufficiently poor (Africa) for donors
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Traditionally, the region has not been a priority of US & EU climate finance
Climate finance flows
BASIC&
Asia
Mid-income economies
(Latin America)
Small Islands&
Africa
“SCALE /ABATEMENT”
Focus of private carbon finance
“POVERTY / VULNERABILITY”
Focus of adaptation finance / aid
Focus?
“REPLICABILITY” Models to avoid switch to high
carbon
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Example: The CDM concentrated 85% of flows in 5 countries, mostly China
Source: UNFCCC Stats (Fall 2010)
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3. Despite the “squeeze” (and partly because of it), Latin middle-income economies are showing unprecedented
willingness to experiment with low-carbon growth models
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3. Mid-income economies are becoming much-needed “laboratories”
• The low-carbon transformation needs champions:– Experimentation (build prototypes) – Replication (test, draw lessons, adjust) – Scaling up (from project, sector to economy-wide)
• Chile, Colombia, Costa Rica, Peru, Mexico are adopting low-carbon most pragmatically. – …BRICS and BASIC: “No conditionality!”– …Africa: “Aid first!”– …Islands: “Right to exist!”
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Precedent: LatAm’s experimenting with low-carbon loans
• The imperative: “Getting infrastructure right”
• Mexico’s and Colombia’s low-carbon investment plans as new prototypes
• Providing key lessons for low-carbon lending for mitigation (World Bank (CIF) & IADB)– Realization that
1) Carbon markets are not delivering the scale of finance needed
2) Aid is insufficient to de-carbonize infrastructure
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REVISITING “FUNDAMENTALS” (Part 1)
Latin America’s infrastructure debate and climate agenda are merging for the first time (politically) – creating opportunity for low-carbon, resilient pathways…
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4. Concerns in LatAm about climate vulnerability are creating new politics
Source: www.metoffice.gov.uk
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REVISITING “FUNDAMENTALS” (Part 2)
But stronger economic ties with China may pull the region in the opposite direction… creating new incentives for carbonization
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5. …China’s role in Latin America’s economy and infrastructure is on the rise
• Gone are 1980s/90s when LatAm looked to the US as the core economic partner…
• …Today, China is boosting growth in Latin America – Bought $44bn worth of the region’s
exports (2009), 10x more than in 2000
• High-carbon sectors are likely to become stronger & oppose climate ambition
Source: See Kevin Gallagher’s Latin America must see China as a trade threat, as well as a partner (FT, Nov 2010)
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In conclusion:
- Middle income economies in Latin America matter in climate politics because of their new role in the negotiations (constructive middle ground) and their low-carbon experimentation on the ground (demonstrating feasibility)...
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- But this momentum must be locked-in by creating larger low-carbon coalitions inside these countries .It is therefore critical to increase the engagement of local business (low-carbon investments) and local governments (low-carbon, resilient cities) at the very least.