On curbing deforestation, which is a medium-term objective, progress was made at Bali. Deforestation accounts for about a fifth of GHG emissions, hence commitments on reducing emissions from deforestation will be beneficial. However, adequate funding is required for the scheme to work.

Estimates for halving deforestation by 2030 are about $10 billion/year, which means that private sector financing is critical. Credits from avoided deforestation will be stored up in the same way as credits from renewable energy projects under the CDM. Another medium-term goal — that of transferring mitigation technology to developing countries — has been prominently recognised in the Bali decision document (paragraph 1d). The key will be adequate provision of subsidy for making it cost-effective for producers in poor countries to deploy abatement technology. The language hints that even intellectual property rights, specifically removal of obstacles for scaling up and transfer of technology, could be relaxed.

Help has been promised to poor countries for the immediate challenge of adapting to climate change. From my reading of the decision, there seems to be only one explicit and predictable source of funding — the adequacy and durability of the source is quite another matter. An Adaptation Fund (AF) will be established, and the AF board will be responsible for the monetisation of certified emission reductions issued by the CDM and forwarded to the AF for countries that are “vulnerable to the effect of climate change to meet the costs of adaptation”. The AF could reach US$1.2 billion by 2012, but the figure seems inadequate against the estimated average cost of 5 per cent of GDP per large disaster in low income countries. The amount pales in comparison with the $20 billion-$30 billion for a Climate Change Mitigation Facility proposed in the UN’s Human Development Report.

... contd.