Kyoto stumbles at first European hurdle

30 March 2004, London -- Britain announced on Monday, 29 March, that it will miss the first EU deadline of 31 March for submitting its plans to cut carbon dioxide emissions under the EU's Emissions Trading Scheme, part of the Kyoto Protocol. France, Denmark, Greece and other member states will also miss the deadline. Germany has drastically reduced its initial aspirations, which were driven by the environmental lobby.

These countries' qualms are justified, says London-based NGO, International Policy Network (IPN). "The potential benefits of the Kyoto Protocol are extremely uncertain, mainly because its effects on climate will be negligible and its costs will be extremely high for consumers and EU employees," says Kendra Okonski, Director of IPN's Sustainable Development Project. "It is high time that EU politicians face the economic reality of their dogged commitment to a failed and unsustainable treaty," she concluded.

Studies suggest that during the first Kyoto commitment period (2008-2012) EU consumers could see rapid increases in their living costs. Food, durable goods, transport, heating and cooling would all be more expensive because all energy (not just oil and gas) would be more expensive. Other studies suggest that by 2020, up to 390,000 jobs could be lost in the UK alone.

In recent weeks, many European organisations and government ministers have indicated that the EU's commitment to Kyoto is misguided since the treaty lacks participation by Russia or the United States. Neither country has ratified the treaty due to similar concerns about its effect on their respective economies and citizens.

Studies show that if EU states continue to implement Kyoto's emissions targets, the increased costs to businesses would be passed on to consumers. Combined with the increased costs in energy, the average EU citizen would see a sharp reduction in the buying power of their wage packet. Companies may ultimately move their investment elsewhere, leading to substantial EU-wide job losses.

These political realities now being faced by Britain, France and Germany are only a sample of future problems, and hence their legitimate backsliding on Kyoto commitments. Faced with low growth and rising unemployment, and the need to remain competitive, the choice is clear: No go to Kyoto.

Notes to Editors:
(1) For more detailed information see "The impact of EU climate change policy on economic competitiveness", produced by Brussels-based International Council for Capital Formation: http://www.iccfglobal.org/PDFs/IBL%20012304%20A.PDF

(2) Other experts on climate policy available for interview and commentary.