COP15: it's all about the money

The debate in Copenhagen is not about what to do about global warming: it's about who's going to pay for it.

The almost 200 countries taking part in the Copenhagen climate change conference face one of the most complicated diplomatic puzzles ever. And yet what's at stake couldn't be simpler.

Science tells us what needs to be done to cap global warming at two degrees Celsius. All the participants at COP15 (the 15th Conference of Partners) have to do is decide who will bear the burden.

In theory at least, that too is very simple: divide the amount of greenhouse gases the atmosphere can handle by the number of people on earth and you know exactly what the maximum per capita emissions should be.

Distribution of wealth

But that's where the troubles begin. The output of greenhouse gases is much higher in rich countries than in poor countries. The average African produces only two tons of carbon dioxide per year, while the average Australian needs almost 27 tons to sustain his lifestyle. The Netherlands is somewhere in between.

There will be little talk in Copenhagen about the disasters the world could face if global warming continues unabated, or even about how to reduce greenhouse gas emissions. Instead, Copenhagen is about money and the distribution of wealth among nations.

Never before have almost all the countries on earth participated in what comes down to a huge transferal of money from the industrialised world to the developing world.

“The two defining challenges of our century are managing climate change and overcoming poverty", the British climate economist Nicholas Stern wrote in The Guardian last week, "and if we fail at one we will fail at the other."

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Industrialised countries caused the problem in the first place with their unbridled growth since the 19th century. Developing countries want their turn at prosperity, or at least an end to poverty. As far as they're concerned, clean energy is a luxury product for the rich countries.

Poor countries mainly want cheap energy, and if the rich countries don't want them to have it, they should pay for the privilege. Not just in terms of financing clean technologies, but also for forest preservation, and the prevention of droughts, floods, water shortages and a rising sea level.

Bickering about the costs

Rich and poor countries also disagree about the costs. Europe estimates the cost of climate change policies in the developing world at 100 billion euros per years from 2020 onwards; the developing countries say they will need at least 240 billion euros per year.

The rich countries so far haven't said how much they are willing to contribute, not even Europe, which in the past has often been quick to whip out its wallet when negotiations threatened to stall.

What's more, past pledges are often not honoured. The Heinrich Böll Stiftung discovered that of the four billion dollars pledged to a clean technology fund not a penny has actually been paid. The World Bank's strategic climate fund, which is supposed to have 1.6 billion dollars, is still empty. And what has been paid has often come out of the rich countries' existing budgets for development aid.

So it is not unreasonable that the poor countries want a say into how the money is distributed. Rich countries would be happy to just let the International Monetary Fund and the World Bank handle the funds. It would save a lot of bureaucratic hassle, they say.

But the poor countries have no confidence in these institutions, which are controlled by Western countries. They want the money to go to a dedicated UN fund in which they too would have a say.

Poor countries bringe little leverage to negotiating table, except for the knowledge that the Copenhagen conference will definitely fail without their cooperation.

Realising this, German chancellor Angela Merkel warned this week in Brasil: "If only the industrialised countries promise to reduce carbon dioxide emissions we will not meet the two-degrees target, and the responsibility will lie with the developing economies."

The developing countries have already turned down the draft text currently being circulated in Copenhagen. They don't wish to sign a treaty that cuts carbon dioxide emissions down to half by 2050 (as compared to 1990), even if that is still substantially less than what scientists deem necessary. They also reject the two-degrees limit.

First, they say, the rich countries have to put their money where their mouth is.