Developing countries may be the first victims of climate change

Most of the studies concerning climate change and its consequences show that developing countries may be the first victims of climate change through a number of phenomena such as soil erosion, floods, droughts, wind storms, extreme climate events and pollution. Furthermore, their reliance on agriculture and their low income situation make it more difficult for them to adapt. In sub-Saharan Africa, the number and impact of natural disasters are both increasing, affecting millions of people every year. The University of Oxford has built a Climate Vulnerability Index which, among other measures of vulnerability, expresses the vulnerability of human communities in relation to water resources. At present a great number of climate change consequences have to do with water: lack of water or an excess of water. All these components are interrelated. They relate to the complexity of energy issues by taking into account climate change, the global crisis in food, water and sanitation and the governance of the country. UNDP mentions that each year, sub-Saharan Africa loses more in productivity through poor water management (one of the components) than it gains through development aid and debt relief: a staggering $30 billion.

The results of the survey for the Climate Vulnerability Index show that the most vulnerable countries are precisely in the low income and the lower-middle income categories concerned in this article. Vulnerability of the poor countries means that it will be more difficult and more costly for them to mitigate and to adapt to the threats of climate change. It could aggravate tensions, migrations and wars. Climate change is bringing a new dimension to the geopolitics of the planet. The war in Darfur is a complex political story but it has a climate change component related to drought. Elsewhere in the world, the first climate change refugees appeared in the Pacific islands in 2008. Deforestation is responsible for more than 18 per cent of global greenhouse gas emissions, more than that emitted by the global transport sector. Forest assets are not distributed evenly across the world. Low and middle income countries account for almost 80 per cent of the world's forest area. Eight out of the top ten countries in terms of annual deforestation belong to the low and lower-middle income countries. Most of this deforestation concerns rainforests. Deforestation is the result of conflicts of interest between short-term private interests, government activities that favour or limit deforestation, pure national interest and global welfare aiming to stabilise world emissions and preserve biodiversity. Deforestation has a number of causes. In addition to the traditional collection of wood for cooking, deforestation is mostly due to short-term money seeking conduct. Deforestation poses many problems. At the local level, continuing deforestation may increase a country's vulnerability to climate change. At a global level, continuing deforestation weakens our possibility of resistance.

This was acknowledged at the Bali conference (December 2007). Research carried out for the Stern Review indicates that the opportunity cost of forest protection in eight countries responsible for 70 per cent of emissions from land use could be about $5 billion per annum initially, although, over time, the marginal cost would rise (Stern Report 2006). At the Bali conference, propositions were made to put in place a fund to compensate for the Reduction of Emissions from Deforestation and Degradation (REDD). The problem is now on the international agenda. Economic poverty is linked with energy poverty and, at the same time, energy is an important vector for triggering economic development and for reaching the objectives of the Millennium Goals. The process of ‘energy transition' shows that within the dynamic of economic development, poor families in developing countries gradually increase their revenues and get access to modern energy fuels, basically electricity and petroleum products. Access to modern energy fuels is a prerequisite for economic development but other conditions are also required: access to clean water, education, health services, and infrastructure for transport and telecommunications. To develop access to energy in a given country, the first step is to evaluate local energy resources and their potential. Another priority is ‘electricity for all' which enables access to mobile phones, TV and the whole communication network including the internet. The paradox of countries where people have limited access to modern fuels is that many of them have a huge potential of untapped renewable resources such as biomass, sun, wind and rivers. In addition, there is an important domestic resource with a huge potential: the improvement of energy efficiency. In some countries, this potential is progressively being exploited but there are a number of obstacles to overcome: financing the investment (public vs. private), mitigating the risks, managing the projects, ensuring maintenance, and mobilising the appropriate human resources.

High oil prices are increasing the economic attractiveness of these developments but the general institutional and educational environment has to be improved substantially. However, we will see later on that decentralised private initiatives could be undertaken in these areas. Let us focus on biomass and energy efficiency. Biomass resources fall into two different categories: (i) traditional biomass: the fuel of the poor with its associated negative effects that have been described above and (ii) biomass to be transformed into biofuels for complementing or replacing petroleum products. First-generation biofuels include bioethanol, which is derived from sugarcane, corn or sugar beets, and biodiesel, which is produced from oil crops such as rapeseed, soybeans or palm. Brazil has been a pioneer in developing ethanol from sugarcane as a substitute for gasoline. Thailand has followed the same path. Indonesia and Malaysia have chosen to develop palm oil on a large scale, a choice which clearly contributes heavily to the destruction of rich bio-diverse rainforests. Since the surge in oil prices, a number of developed and developing countries are considering the possible development of biofuels. Brazil is proposing its technologies to other developing countries in Central America and Africa. The development of biofuels requires very careful analysis on a local basis also because a national decision may have an international impact on the energy/environment issue. The case of biofuels confirms the growing interdependence between energy policy, climate change issues and food production and also between national political decisions and the global management of climate change.

Once more we see conflicting interests between nations, between private goods and one single public good which is the climate. Setting aside domestic resources of oil and gas that are generally associated with the problem of the ‘resource curse', developing countries have a great potential for the development of renewable energies: wind, solar and hydropower. While Europe and North America have already exploited about 60 per cent of their hydro potential, it is estimated that the rate is about 20 per cent for Asia and South America and only 7 per cent for Africa. The geographical location of these potential resources remains an obstacle for project development.

Another very important domestic resource to be considered is energy efficiency. In all countries, there are huge potentials for improving energy efficiency. This means that a given energy service can be met with lower energy consumption. Improving energy efficiency is a win-win strategy: it reduces the energy bill, it reduces emissions and it is 25-50 per cent cheaper than producing the amount of energy which is saved. Vast potentials for energy saving opportunities remain untapped even though current financial returns are strong. The World Bank has been very active in the field of proposing and financing energy efficiency programmes in developing countries. The Bank has carefully reviewed the means by which energy efficiency might be improved as well as the existing obstacles. The organisation proposes ‘a general model for successful delivery programs for energy efficiency investments'. In developing countries some successful programmes have been put in place but, very often, the institutional and political environment is seen as an obstacle to a real policy of energy efficiency. The political willingness, which is crucial in these matters, is frequently lacking. The banking community is not familiar with energy issues and this sort of investment is not a priority. The legal framework is often insufficient to secure some unusual contractual arrangements. However, high energy prices could trigger the financial interest of governments for such programmes. In addition, the investments related to the Clean Development Mechanism could contribute to sustainable economic development. CDM projects in developing countries are mostly concentrated in emerging economies such as China and India.

They both represent more than half (53 per cent) of the registered CDM activities in the world. An additional 33.3 per cent of the total CDM projects are located in upper-middle economies such as Brazil, Mexico, Malaysia and Chile or in high-income economies. Only 13.7 per cent of the CDM projects (in 2008) go to the low and low-middle income countries. These numbers may evolve in coming years, with the improvement of private-public partnerships, a greater involvement of international organisations and the Reduction of Emissions from Deforestation and Degradation (REDD) initiative.

Developing countries may be the first victims of climate change

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