Op-Ed Contributors

Passing the buck for pollution

By Zhang Monan (China Daily)
Updated: 2011-04-11 08:03

Developed countries should shoulder their own responsibilities instead of imposing a carbon tax on developing economies

Developing countries should take active measures to head off the impact of developed countries' intensified attempts to shift the cost of their historical carbon emissions to developing countries.

In a move designed to make developing nations pay the price for the treatment of their own carbon dioxide emissions, the Unites States, Japan and European nations have proposed a carbon tax on commodities coming into their territories.

On Nov 19, 2008, the European Parliament and the European Commission adopted a bill, including international airlines into the EU Emissions Trading Scheme System (EU ETS) and announced that the bill would take effect on Jan 1, 2012. According to an estimate made by the International Air Transport Association, the European bill, if put in place, will result in an additional 2.4 billion-euro ($3.46 billion) cost for global airlines.

Under the new system China would have to pay about 740 million yuan ($113 million).

This carbon tax is a new form of economic hegemony. The costs and benefits brought by global carbon emissions have long been unevenly distributed between developed and developing nations.

It is extremely unfair to use developed countries' carbon emission standards to measure the volumes of carbon emissions in developing nations and it ignores the large-volume of carbon emissions produced by the highly industrialized countries during their development.

Statistics show that developed nations are responsible for 80 percent of global carbon emissions since 1950. After enjoying a high-polluting and high-energy consumption stage, developed countries are now in a cleaner and less-polluting post-industrialized stage. In comparison, emerging nations such as China, Russia and India are still in the early or middle stage of their industrialization and still rely on heavy industries for their economic growth.

The formation of a global structure of labor division that favors developed nations has accelerated the transfer of global low-end industries, especially the high-polluting and high-emissions manufacturing sector, to developing nations and has enabled developed countries to shift some of their carbon emissions to developing countries. Statistics indicate that as a result of this shift, as much as 1.2 billion tons of carbon emissions are passed on to China every year, 20 percent of the its total volume of carbon emissions.

By imposing carbon taxes on inflowing commodities, developed countries have their own ulterior motives. Because of their light industry-dominant industrial structure, developed countries have a lower carbon emission intensity than their developing counterparts.

The carbon tax, which is in essence a new-type of trade barrier, will protect their own homegrown enterprises and raise the export costs for developing countries, compromising their competitiveness.

A carbon tax, if adopted globally, would have a huge effect on China, a fast-growing economy that is fuelled by coal and oil consumption. Currently, China's energy consumption for every unit of its gross domestic product (GDP) is more than twice the world average. Therefore, a carbon tax would directly raise the costs for China's manufacturing sectors, reduce their profit margins and weaken their competitiveness in the international market.

A survey conducted by the World Resources Institute (WRI) shows that China's exported commodities have the highest level of carbon emissions among world countries. That means that China's exports will bear the brunt of any carbon tax. A World Bank report indicates that the implementation of a carbon tax in the international market would mean an additional 26-percent on "made-in-China" goods and that exports would decline by 21 percent.

To uphold their right to development China must work with other developing nations to ensure the accumulated carbon emission volumes, per capita GDP and per capita disposable incomes are the standards for the distribution of global carbon emission volumes. At the same time, developed countries should set up a compensation mechanism for carbon emission reductions in developing countries to protect the latter's fledging industries and their trade interests.

China should also accelerate its long-overdue economic and industrial restructuring and develop low-carbon industries.

The author is an economics researcher with the State Information Center.