EU summit to hold off climate funding decision

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EU heads of state and government are expected to yet again postpone a decision to provide poor countries with financial contributions to fight climate change when they meet in Brussels next week (18-19 June), according to diplomatic sources.

International financing of climate change is one of the most contentious items on the agenda of today's meeting of EU finance ministers, which will submit recommendations for next week's summit.

But little progress is expected, as no figures have been put on the table and EU member states seem to be expecting a rerun of previous debates.

"We are a long, long way from any figures," one government official said. He added that at this point it is more a question of what general messages the EU wants to give to other parties about its willingness to chip in.

Another official said it was "unlikely" that the June summit would spell out its final position on financing, as there is no clarity as to where other nations, and notably the United States, stand on the issue.

The ministers will discuss conclusions prepared by working groups - the Economic Policy Committee and the Economic and Financial Committee on international financing mechanisms for climate policies - following on from the March summit and previous finance and environment ministers' meetings.

Those gatherings proved disappointing for observers, who had hoped the EU would show leadership and commit to giving sizeable funding to developing nations in order to secure a new global climate treaty in December in Copenhagen (EurActiv 18/03/09).

The report reiterates that the lion's share of funding for mitigation should come from carbon markets and private investment, according to member-state sources. Money for adaptation in vulnerable countries would nevertheless require extensive public funding, to be distributed in a cost-effective, fair and transparent manner, says the report.

But the draft summit conclusions leave open the issue of how the global distribution key should be calculated.

Burden-sharing

Although a majority of member states are in favour of the text currently on the table, talks are expected to drag on over a contentious article on effort sharing, sources said.

Poland is insisting that the EU must decide on dividing the financial burden between its member states first before concluding any global climate agreement (EurActiv 10/03/09). But many others believe this would put additional strain on the bloc as it tries to hammer out an agreement on how to share contributions internationally.

An official pointed out that this is a typical discussion to be having at this point in the negotiations, as burden-sharing is a zero-sum game internally.

The draft conclusions mention a country's ability to pay and its level of emissions as the basis for calculating its financial contribution. Another proposal is to take into account the potential to reduce emissions, which would benefit states with energy-intensive industries. But this found little support.

"It's difficult to imagine that any other criteria could be used internally," said one member-state official. He added that there was no consensus on what was meant by "capacity to pay", for example, anticipating a difficult debate.

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