Professor Warwick McKibbin is an ANU Public Policy Fellow at Crawford School. Professor McKibbin was a member of the Board of the Reserve Bank of Australia from 2001- 2011. He teaches Modelling the World Economy: techniques and policy implications (IDEC8127).
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A window of opportunity has opened up for a new global carbon pricing forum to be established, according to a leading economist.
Climate negotiations in December 2012 in Doha, Qatar, began discussions on a new agreement under the United Nations Framework Convention on Climate Change to be developed by 2015. Chair in Public Policy Professor Warwick McKibbin said climate negotiators should take this momentary opportunity for new global climate agenda items to establish a Carbon Pricing Consultation (CPC) process.
McKibbin said that while climate policy was usually debated at national government level, an international discussion process would provide greater opportunities for cooperation and global solutions.
“A CPC process would address a glaring gap in climate talks to date,” he said.
“It would provide opportunities for negotiators, as well as the administrators of national pricing policies, to discuss how to induce, practically and efficiently, the broad economic shifts required to de-couple emissions and economic activity.”
He added that although carbon pricing has received little multilateral discussion up until now, there are big potential reciprocal benefits if countries join together to discuss these issues.
“The goal of these international discussions would be to build mutual comfort and confidence in carbon pricing, share views, prevent disputes and trade disruptions, identify and replicate successful approaches, learn from one another’s mistakes, build institutional capacity, and generally promote mutual cooperation on serious, economically efficient, measure to mitigate emissions,” he said.
McKibbin said that the CPC would be unique from other international forums that currently exist.
“CPC would differ from most talks under the United Nations Framework Convention on Climate Change in that the agenda would focus specifically on administrative, economic, and trade-related aspects of policies that price carbon and other greenhouse gases.
“The defining characteristic of the CPC, distinguishing it from existing clean energy and climate consultations, would be that finance and trade ministries (not the environment and energy ministries) would take the lead.”
Further discussions relating to a CPC will take place at the G-20 meeting in Brisbane next year. Members will discuss whether the CPC will join the ranks of other international climate forums.
“It may be possible – and it is desirable- to embed the CPC within the Major Economies Forum, the G-20, or other existing forums as much as feasible,” said McKibbin.
Professor McKibbin’s proposal, jointly authored with Dr Adele Morris of the Brookings Institution and Professor Peter Wilcoxen of Syracuse University, is published in a new working paper A Climate Diplomacy Proposal: Carbon Pricing Consultations.