Climate change and the development tests

Speech by Douglas Alexander, UK Secretary of State for International Development, at an event hosted by New York University's Center on International Co-operation, New York, 14 April 2008

It is a great pleasure to be here in New York at the Center on International Co-operation. And I am particularly personally pleased to be sharing the panel with Dr Sri Mulyani Indrawati. And let me extend my congratulations to Indonesia and the COP president, under whose excellent leadership we achieved a historic agreement on a roadmap for achieving a global climate deal by the end of 2009.

As we gather here today there are few, if any, of us who are not gripped by the necessity of tackling dangerous climate change - not only to safeguard our way of life, but also out of an obligation we have to future generations.

I believe that to these two great motivations we must add a third. If, collectively, we do not take the necessary action, we risk condemning the world's poorest people to poverty.

We must heed the warnings from the 2007 UN's Human Development Report, which showed categorically that climate change is, and I quote directly: "the defining human development issue of our generation".

As the UK's International Development Secretary, I have seen for myself in recent months how climate change and its impacts have come to define the lives of many poor people.

In Garissa in northern Kenya last autumn, I visited a camp of 350 families living in grinding poverty, forced from their homes by flash floods. I met with local leaders who are trying to preserve the nomadic way of life traditional to so many of their people in that part of Kenya. One told me bluntly that climate change was one of the greatest threats they face.

He said that the seasons he remembered as a child have gone. That now when it rains there are floods, and when the sun shines there is drought. "Climate change", he said, "hits us hardest."

Experiences such as these have convinced me that for developing countries climate change is today's crisis, not tomorrow's risk.

But we must not allow the climate change debate to neglect - or even prevent - the right of developing countries to grow. Development and climate change, I believe, are - and must be seen as - inextricably linked.

For if climate change threatens development, it is just as true that development is the only credible response to climate change. For prosperity and economic progress are the best protection for vulnerable communities.

Countries with well-educated people, with good infrastructure and with the wealth to cope with climatic shocks will fare best.

Climate change needs to be systematically integrated into development policy-making and planning at all levels. Enhanced action by the international community is necessary to help countries continue their development path - in particular the mobilisation of additional resources through innovative financing will itself be crucial.

The new challenges of climate change makes it even more important that developed nations live up to their aid commitments. But it is clear that additional financing is required to implement low carbon, climate resilient development and adaptation measures.

So what is the role of the development community - donors, developing countries partners and broader civil society? How can we work together to ensure that through tackling climate change we can deliver maximum benefits to the poorest and most vulnerable people on the planet?

This morning I suggest that we set ourselves five 'development tests' against which we can judge the effectiveness of the international response on climate change. These are:

Firstly, a credible, fair and ambitious global deal;

Secondly, helping countries grow in a low-carbon way;

Thirdly, a reformed carbon market;

Fourthly, building climate resilient economies and societies;

And finally, reforming the international system.

Let me take each of these in turn.

A successor to the Kyoto protocol will be crucial to prevent further dangerous climate change. Bali started us on the road but let's be clear, the hard work starts now to get a comprehensive deal in Copenhagen in 2009.

A fair deal must include a long term goal to stabilise greenhouse gases at a level that avoids dangerous climate change. Critical to this is a fair allocation of effort. Developed countries must take the greatest responsibility for cutting emissions.

But developing countries - in particular the largest emerging economies - will need to join that transition too. Their emissions are growing fast, as their demand for energy increases. But the United Kingdom is also committed to the principle of differentiated responsibilities.

So this brings me to our second development test: we must build a low-carbon economy that enables sustainable long-term growth in both developed and also developing countries.

This will require the flows of finance and technology to developing countries. It will also require new knowledge and we have an important role in helping developing countries develop the capacity to adapt new technologies to suit particular local needs.

That's why the UK has provided over =A313.5 million to drive the development of the Clean Energy Investment Frameworks at the World Bank and Regional Development Banks - to help developing countries take advantage of technology and clean energy. But we need a dramatic expansion to this effort.

At the G8 Summit in July in Japan, leaders are planning to launch a multi-donor Strategic Climate Fund, administered by the World Bank.

The Strategic Climate Fund will build on the US pledge of $2 billion for the Clean Technology Fund and Japan's commitment to work with the UK and US to establish a suite of new Climate Investment Funds.

The UK's =A3800 million International Environmental Transformation fund, launched last year by our Prime Minister Gordon Brown, will form one cornerstone of this strategic international fund.

I should stress that we do not wish to pre-empt post 2012 arrangements, but hope to use this fund to pilot approaches and financing mechanisms to build developing countries' confidence that economic growth and development can be low carbon and indeed climate resilient.

We are firmly committed to a strong role for developing countries in the governance structure and we believe recipient countries should also choose which agencies/partners they wish to work with.

While in the short term, donor funding will be central to how we support climate change, in the future new sources of finance could be used to address these very issues. One potentially important source could be a global carbon market, which the Stern report estimated could eventually provide transfers of up to $40 billion per year to developing countries. But that market is still in its infancy.

The third development test therefore is how to reform the carbon market, expanding the reach and impact of carbon finance, including new sectors, such as forests, and ensuring that developing countries can benefit from it.

We also need to steer the design of the Clean Development Mechanism so that it supports progress towards an effective, global market, and that it also supports low income countries.

The fourth test I mentioned is based on adaptation, or what I prefer to call climate resilience. In short, we must help protect the most vulnerable from the now inevitable impact of climate change.

We need to help developing countries to plan their efforts to tackle poverty differently and better. Not with adaptation as an add-on, but with climate resilience built in from the beginning.

For in a very real sense development is the best adaptation - strong institutions, education, health, infrastructure and a diversified economy all strengthen resilience.

Using a proportion of funding from the UK's ETF, the Strategic Climate Fund will pilot approaches to building resilience in a few developing countries to demonstrate that it is possible to integrate adaptation into development by providing additional finance.

Developing countries will also need help to answer the most basic questions of what climate change will mean for the most vulnerable regions and communities within those countries.

The United Kingdom will spend over =A3100 million over the next five years on research into the science, social and economic impact of climate change for the most vulnerable developing countries, and on helping those countries to put that new information to the best possible use.

The final development test that we cannot afford to fail is to make the international system fit for purpose to meet the challenge of climate change.

If we are able to reach a global deal in 2009, we need institutions that can support this deal, regulate and manage carbon markets, and ensure developing countries have sufficient finance, capacity and information to grow sustainably and adapt to impacts.

Yesterday I was in Washington at the Spring Meetings, and together with the necessary conversations on the present levels of food and commodity prices, devoted much time to discussing ways in which the Bank needed to become a Bank for the Environment alongside its responsibility/core task to reduce poverty.

And later today I will be discussing how the UN, with sustainable development as its overarching objective and as guardian of the Millennium Development Goals, is uniquely placed to address climate change.

There is a vast array of good work going on to deal with climate change within the UN system, unless these activities are co-ordinated, the full potential of the United Nations in tackling climate change will never be realised.

As member states we have responsibility to ensure that the UN family works as one, and so the UK will strive to ensure that our activities, policies and demands on climate change do not fragment the system.

But the UN must also take responsibility for pulling the system together and I welcome the leadership the Secretary General is showing on this.

Another important role for the international system is how to finance the response to climate change. Whilst future financing arrangements should be properly negotiated through the UNFCCC process to ensure they support the overall climate deal we need by 2009, preparations for the Financing for Development conference in Doha can usefully look at these issues from a development perspective.

The new challenge of climate change makes it even more important that developed countries live up to their commitments. But Doha also needs to recognise the additional financing needs for implementing low carbon, climate resilient development as I've already suggested.

These preparations should also note the challenges posed by climate change, the threat to the achievement of the MDGs and best practice in integrating climate change into development strategies rather than dealing with it as an 'add-on'.

Making economies and societies resilient to the impacts of climate change also requires funding. This means that it is now all the more important that developed nations live up to their promises to reach aid commitments.

But we cannot spread existing aid resources even thinner as this would risk the achievement of the MDGs. It is a key principle for the UK that financing for climate change should support not detract from our efforts to achieve the MDGs.

But how much extra funding will be needed over and above existing aid commitments is uncertain. More work needs to be done to establish costs and identify sources of funding, which is why the UK is funding a study with the World Bank and the Dutch Government to help establish the costs of effective adaptation.

I hope that these development tests can be used by us all to show that social justice - across both geographic boundaries and generations - is intrinsic to the climate change debate. When negotiators come together - first in Poznan this year, and then in Copenhagen next year - it is important that they recognise the importance of reaching an agreement recognised as fair.

The urgency of that endeavour becomes ever clearer to us: put simply, in 2005 the world came together to make poverty history. If we do not understand and address climate change it threatens to make poverty the future for billions of our fellow citizens.

Confronting climate change is therefore our shared challenge. Dealing with it could be our shared opportunity. Tackling it I believe must be our shared achievement.