MR. STERN: Thank you very much. I’m glad to be here. I actually just got here and I’m pleased to be in Cancun and looking forward to engaging with my many colleagues all around the world.
I think that there are clearly a lot of challenges here, but also in my view, a lot that can be accomplished. What we need to do, and I think all understand that what we need to do is to produce a balanced package of decisions covering all Accord issues from the Copenhagen Accord, including mitigation, transparency, financing, technology, adaptation, and the REDD issue, forestry. And I believe we can do this. While differences still remain, a lot of useful work has already been done and I’m hopeful that we can work through our differences on all the various issues.
We know, for example, how to anchor the mitigation pledges from the Copenhagen Accord, the listed targets that developed countries agree to implement and a list of actions that developing countries agreed to implement in the Copenhagen Accord. We know how to launch the Green Fund called for in the Copenhagen Accord, following the guidance provided in the Framework Convention itself. We know how to establish a technology mechanism as called for again by the Copenhagen Accord. We know, I think in broad strokes, where we should be going to carry out the adaptation and REDD agreements, also from Copenhagen, and we have already seen some very good ideas put up on the table on the specific content and concrete elements of the transparency system, including International Consultations and Analysis. A concept that was directly negotiated by our leaders last year, including President Obama, Premier Wen, Prime Minister Singh and Presidents Lula and Zuma.
In my view, anyone who says that any of these issues are too difficult or should be put off for another day, is not trying hard enough. None of these issues is actually too difficult for us, and none of them can be put off. Developing countries certainly would not have agreed to list and implement mitigation actions, they would not have agreed to the International Consultation and Analysis concept, if developed countries had not for their part agreed to landmark provisions for financial assistance, technology, adaptation, mitigation, REDD and so forth. And the reverse is also true, obviously, developed countries would not have agreed to all of those financial and technology provisions if developing countries had not agreed to implement mitigation pledges and to a transparency system that includes what is now being sometimes referred to as ICA. We have MRV and we have ICA in this business.
In any event, we all know this, I think all of the countries and negotiators know this and anyone who was in Copenhagen last year knew it. So the key here in Cancun, I think, really the watchword is balance, genuine balance, comparable progress across all of the key issues. Balance is in our judgment, in my judgment, the key that can unlock the door to a strong set of decisions here in Cancun followed by a ramped up fast-track process in 2011 to elaborate all of the remaining details that will need to be elaborated on some of these issues, and then a final fully operational decision that could be done next year in South Africa. I think we can get there as long as countries do not seek to become stumbling blocks to halt or slow down progress. I also think, and it’s often the case at this point in any of these negotiations, that the outcome hangs in the balance. We don't know which way it’s going to go yet. But I think that we clearly can do it and we should do it and the U.S. will certainly keep doing our best to try to make that happen. I’m happy to take questions.
QUESTION: Could you tell me what you understand by anchoring pledges? How could the U.S. anchor its mitigation pledge in Cancun?
MR. STERN: I'm really referring to capturing what was done in Copenhagen. The United States made clear now and on multiple occasions and I’m happy to make clear again. We’re not walking away in any way, shape or form from the submission that we made last year. And I think for countries generally, I actually don't think it’s very complicated. I think you could have pretty slim amount of language to make clear that the targets to be implemented by Annex I Parties and the actions, the listed actions to be implemented by non-Annex I Parties are listed or reflected in such and such a place. I think there will have to be a decision about whether such and such a place is a new appendix or is a reference to what was done last year. I think there are different ways to do that. But I don't think it's a highly complicated piece of business with respect to the language. Undoubtedly there are issues that are kind of involved in it, but I don't think it's a complicated concept. That's essentially what we would have in mind.
QUESTION: Mr. Stern, could you talk a little bit about China vis-à-vis its continual calls for a balanced package, which is sort of the phrase that you've used, but taking care of these more modest threats in terms of climate finance and adaptation and maybe putting some of these other more difficult things like MRV off until South Africa?
MR. STERN: I guess that's what I was trying to say in my opening remarks. We don't buy that for a couple of reasons. The agreements to these various issues that were reached last year at the leader level were all part of the package that balanced--the different elements balanced each other off, so that there were some things that were very important to some countries and some things very important to others and a way forward is not simply to say, “we’ll work on the ones that are important to this group of countries but not that group of countries.” So at that level I think this doesn’t make any sense and we wouldn't subscribe to it. But the other thing is that I don't buy it as a matter of the substance. There are actually challenging issues that remain on many of these, challenging sub-issues that remain with respect to many of these core elements. I don't think it's harder to get the mitigation done. It’s not harder to get the transparency done. I think they can all be done. And in our view, and it's a very strong view, these issues need to move together at a comparable rate. I don't think there's any fruit that's hanging lower than any other fruit.
QUESTION: How concerned are you that debate and disagreement that we've seen so far over the Kyoto Protocol will derail talks on achieving the balance package of decisions you are talking about?
MR. STERN: We’re always in a funny place with respect to the particular debate going on over the Kyoto Protocol, because obviously we are not in it. And so we’re not part of those discussions per se. Having said that, I fully understand the difficulty of the issues. I understand where Parties are on both sides. I guess the thing that I would say is we have a chance to make progress here. It was an extraordinarily difficult COP last year, but with it all, we actually did make some real progress. People have differing views on this, I know, but I think at the leader level we made some real progress on a number of important issues and we can carry that forward. And we can bring the understandings that were reached last year into the Framework Convention system, the COP system, and advance them. And I would hate to lose that on the grounds of strife over the Kyoto issue. So I would hope that a way could be found that both sides could live with, that would be a compromise or a way to continue the discussion next year. But again, I'm highly mindful that the U.S. is not part that debate, so there’s only so much I can say about it, but I do think it would be very unfortunate to lose the progress that I think is there to be reached if we can do it right on the LCA side.
QUESTION: On the question of anchoring of pledges, this morning we heard again from the representatives of China and Japan, two very different and well-known positions that anchoring from developing countries, according to China, should be voluntary and according to Japan should be in some sort of a legally binding format. So these are, again, positions that have been reiterated. So where do we go from here? How do you think on MRV, on mitigation and ICA can any progress be made if countries continue to give their seated positions.
MR. STERN: I just want to make sure I understand the question. Is the question you’re focusing on how we can make progress when some countries insist that there be legally binding commitments from developed countries?
QUESTION: From developing countries. Because that’s what the Japanese envoy said today.
MR. STERN: I wasn’t here. I just got here. So I can't speak with authority about what somebody said earlier today. But my understanding -- obviously I’ve been following this very closely from Washington, and in very frequent contact with the U.S. team before I arrived today. My understanding of the Japanese position has to do with the Kyoto track, not the LCA track. I think that the Japanese have made their views with respect to Kyoto about as clear as you could make them, so I don't think I need to comment on those. I think that if you look at the LCA track, if you look, for example, at what was done last year in the Copenhagen Accord, the whole issue of legally-binding was kind of put on hold. So what you had was countries on both sides agreeing to implement different things. So you have developed countries agreeing to implement economy-wide, absolute reduction targets. Countries on the developing countries side who listed actions were agreeing to implement those actions which generally involved a relative reduction and not a full-scale target, and I think you could continue forward on that basis. And many countries I know feel that that is an imperfect basis because it's not a legally binding agreement, and that's probably true but you can't always get the perfect for some period of time and it's a good idea to make the progress that you can make in our view.
QUESTION: Japan this morning noted that there is wide agreement, that there should be a balanced agreement here, but that there are a 194 different definitions of balance. I wonder if you could give me your definition of a balanced agreement?
MR. STERN: I think there are many fewer than 194, there may be some number but, I don't have anything magic to say about this, but let me try to give you maybe an illustration. Balanced to me means that you are making genuine and let's say roughly comparable kind of progress across the different issues so that -- let me just give you a completely hypothetical example. If you were agreeing to launch a process to establish a Green Fund, with parameters kind of set out in the decision that you're taking and agreed to a process that would result in the Green Fund, hopefully within a year. I would think that you would need, certainly with respect to mitigation again; you'd need the anchoring that I'm talking about. And with respect to transparency, you would need a decision that included not every detail but that included the concrete elements of what transparency in ICA, in the International Consultation and Analysis system, would look like. So you wouldn't simply be saying, will do transparency, and it will be a facilitative system, and it won't be intrusive, and we will work everything else out later. That would, to me, not be anything close to comparable with respect to the Green Fund decision that I was just talking about. I would think that you would need to say something much more concrete, you would talk about the kind of content that would be included in a report that would be made from the developing country; you would talk about if there were going to be a panel of experts; you would talk about if there is going to be some kind of consultative discussion; you would enumerate some of the elements, understanding that you are going to flesh them out more, but you would put some flesh on the bones not just a very, very, general. That's what I mean by balanced. I don't have a specific set of statements on each issue but, you see things moving in a kind of similar pace.
QUESTION: Everyone in this room knows that the there is an enormous human cost that is going to be paid if we do not solve climate change in the next few years. We are talking about billions of lives, and certainly the lives of us in this room, and many others yet to be born. We are two years after the largest global recession that we have seen since the 1930s. I am wondering why U.S. negotiators continue to so confidently put trust in free markets in any portion of the climate change agreement.
MR. STERN: Well, I think you're asking a question that goes for example to the nature of the European emissions trading system, which is a market system, for example, following through on an idea that was included in the Kyoto Protocol that actually the United States championed. In my view, it is precisely because of the dangers that you're talking about that you need to be able to get, in essence, the biggest bang for the buck. We need to be able to mobilize all the capital that you can mobilize, you need to be able to get emissions done at the cheapest level, and be able to mobilize markets in the right way, and it is a good idea, you just got to do it in the right way. But simply relying entirely on government funds, particularly because of the recession that you just talked about, which has rolled right into what I think is a fairly long-range fiscal crisis and problem in Europe, United States and other places -- I think you need to tap into and mobilize private sources and private markets. So I think it's for exactly the same purpose that you're focusing on, but I think that it is a good idea, I think Europe is probably further along on this than anybody else at this point but I admire what they're doing.
QUESTION: Today the ALBA Nations said that there will not be, or that it would be very difficult for them to be a kind of balanced package unless there's a second commitment in the Kyoto Protocol. What are you going to do about that? I mean there is something that appears to be a strategy to obstruct that. And secondly, would the United States be happy without having a legally binding framework agreement even after 2012. Would the United States be happy to move forward with Copenhagen style of commitments and have there be no legally binding framework agreement after 2012?
MR. STERN: Let me put it this way, a great many countries look at balance both within each track and between the two tracks, so are looking for some progress with respect to the Kyoto Protocol. I recognize that. I also recognize that there are very sharp differences of opinion with respect to how that ought to be handled. There were differences of opinion that were quite sharp last year as well and, I think that I really don't have anything to add to what I said before which is, that on one hand we’re not part of that negotiation. I would hope that a way could be dealt with, or could be found, that could at least have the discussion on that issue move forward without killing the progress that could be made on the LCA track. You're right, it may be that it just doesn't happen and may be the problems with Kyoto completely tie this conference up, but I am very hopeful that that doesn't happen because I think it would be a huge mistake.
You asked if the United States would be happy to have a post-2012 world without a legally binding agreement. It is not a question of being happy. It's a question of trying to see what can be done in the real world that can make progress on this issue, and we have made it clear on any number, many, many, many occasions -- every time I am asked that question for the last two years, that for us a legally binding agreement means legally binding. If it's legally binding mitigation commitments for the United States and Europe and Japan and everybody else, and there would need to be legally binding mitigation commitments for China and India and Brazil and so forth. I just don't think that we are there yet, and so if we are not there yet, it doesn’t mean that we are not ever going to be there. But if we are not there yet, in my view, the course [is] trying to put operational decisions in place, rather than doing nothing because you can't get the legal agreement. You cannot get the home run so you won't play ball -- I don't think that's a good idea. I think that if you think about this, and we are actually able to make a kind of progress that I hope we could make, a year from now we could be actually implementing, standing up, based on the decisions that happened this year, a Green Fund; standing up a technology mechanism; standing up significant actions on adaptation and REDD; implementing mitigation commitments, albeit non-legally binding, but still commitments that are taken very seriously by the governments who make them; and putting in place a transparency system with International Consultation and Analysis. Do we want to be doing these things a year from now? Or, do we want to be having the exact same conversation a year from now where nothing has happened and we say, “well, we couldn’t get legal, we have got to get legal.” I think we should be trying to get legal but in the meantime let's get what we can get. That's my view and I have always said it.