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November 2002 | |
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Interview: Life After Keating Industrial: That Friday Feeling Bad Boss: Begging to Work Organising: Project Pilbara Unions: Off the Rails International: Brazil Turns Left Environment: Brown Wash History Special: Learning from the Past Corporate: Will the Bullying Backfire? Technology: Danger Lurks For The Passive History: In Labour�s Image Politics: Without Power Or Glory History Special: A 'Cosy Relationship' Culture: Blood Stains the Wattle Satire: Iraq Pre-empts Pre-emptive Strike Poetry: The Executive Pay Cut Review: Time Out
Month In Review The Soapbox The Locker Room Indigenous Postcard Bosswatch
Why The User Should Pay
 Trashing the Siren TheoryMore Bali Feed BackClean Election Laws Now!And Now, Some Fan Mail!Policy VacuumTom's Postscript
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Environment Brown Wash
************* The United Nations Sustainable Development Summit held in Johannesburg in early September 2002 was organised to commemorate the ten years since the international community had come together at the Earth Summit in Rio de Janeiro. The Rio Earth Summit had formulated a wide-ranging package of programs by winning multilateral support for the Agenda 21 program to support world-wide sustainable development programs aimed at redressing underdevelopment and promoting environmental sustainability. The follow-up Johannesburg Summit promised to build on the achievements of Rio. But it also faced considerable criticism on the grounds that that it proposed a much less ambitious commitment to developing the range and level of support chartered in the Agenda 21 program. The response of organisers was to point to the desirability of moving beyond the strong rhetoric of the Earth Summit to progress meaningful and concrete plans for promoting sustainable development. On his return to Australia the Minister for the Environment, David Kemp, who had led the Australian government delegation to Johannesburg, acclaimed the Summit as a great step forward. The 2002 Earth Summit concluded agreements for addressing the problems of poverty and environmental degradation, the most publicised being the multilateral commitments to halve the number of people who lack access to safe water and sanitation by 2015. The most noteworthy environmental agreements set in place targets to reverse the extinction of species and restoring fish stocks. The Minister attributed the Summit's "surprisingly positive outcomes" to the "pragmatism and flexibility" that was displayed in negotiating agreement (Press release 5 September 2002). Australia was represented as having played a very positive and constructive role in Johannesburg. The delegation, the Minister contended, had demonstrated considerable responsibility in its role as a conscientious global citizen. Australia had contributed in positive ways to devising sensible programs that could deliver achievable outcomes. Perhaps more importantly, at least as far as the Australian conservative government was concerned, the multilateral agreement was regarded as being to Australia's longer term economic advantage. It would result in obstacles being put in place that frustrated economic advance in the way in the Rio Summit was alleged to have done. Indeed the Minister applauded the success of the Australian delegation in helping to negotiate an agreement that would benefit Australian business and open up employment opportunities. Yet it makes good sense to look beyond the Minister's rhetoric to reflect a little more critically on the measure of Australia's commitment to promoting sustainable development and the precise nature of the benefits that the Johannesburg Summit will purportedly deliver to Australia. There are three key considerations that are worthy of reflection. It is first obviously necessary to consider the Summit's achievements. Secondly, given Australia's prominent role in negotiating agreement, it makes sense to reflect on Australia's contributions to negotiating the Johannesburg outcomes and, more generally, the measure of Australia's commitment to supporting sustainable throughout the world. This also provides the opportunity to evaluate the nation's integrity as a responsible global citizen. Thirdly, it is appropriate to assess the impact that such treaties as the Earth Summit might have on the future shape of the Australian economy and employment more particularly. The Johannesburg Summit brought together leaders of governments throughout the world - with two notable exceptions - with representatives from a host of non-government organisations and major transnational corporations. The exceptions were the US President George W Bush and the Australian Prime Minister John Howard, the former apparently because of his embrace of the US administration's unilateral approach to global politics. The Australian Prime Minister's decision not to attend the Summit must be interpreted as a clear measure of his government's resistance to global efforts to promote sustainable development. The amount Australia provides to international development aid programs provides a dollar equivalent, and this now represents a smaller proportion of its resources to development aid than at any time since World War Two. Australia is of course not along in this miserliness. Australia's diminished aid program in fact mirrors the position of many advanced industrial nations, and this suggests that the declarations of support at the second Earth Summit for development are little more than hollow gestures. Indeed when one looks at some of the specific declarations made at Johannesburg, this Earth Summit marked a noticeable retreat from undertakings that had been made in other international forums. The commitment on biodiversity, for example, is not as robust as the ministerial declaration made at the Hague Biodiversity Convention in April earlier this year. This lack of commitment is evident in the Australian government's position. It has in effect cut resources allocated to biodiversity programs, and this is underscored by the more contingent nature of those allocations. The Johannesburg declarations on strengthening laws to better manage forests and the efforts to reduce illegal logging belie the failure to progress these concerns over the last decade. We can see how this is being played out in Australia with the government's failure to do anything meaningful to slow down the rate of land clearing. The commitment to work towards combating overfishing of the world's oceans was represented as one of the great achievements of the Australian delegation. The agreements struck between European fishing companies and African nations that provide access to coastal fishing resources appear to contradict this ambition. Likewise, the Australian government's preoccupation with commissioning the navy to police the coastal borders of northern Australia in its campaign to obstruct the entry of asylum seekers has made a nonsense of its commitment to policing illegal fishing in the Southern Ocean. The idea that Australia has demonstrated leadership as a responsible global citizen must be seriously questioned. The Australian delegation went to the Summit determined to block any moves for tougher environmental regulations and targets to improve environmental standards that might frustrate economic development in Australia. The delegation was totally consumed by the ambition to ensure that nothing would be put in place that would act as a disincentive for business investment or Australia's export industry. Once again, it makes sense to see this as one element in a broader agenda because this same preoccupation with advantaging business has more or less defined the nature of Australia's direct developmental aid program. Aid programs are now wholly defined in terms of the opportunities they will generate for Australian business, be this in the form of Australian private companies securing the consultancies to oversee aid programs or in terms of ensuring that aid packages provide a feedback for Australian exports. (Most of Australia's aid is tied and managed through private companies and act primarily as a prop for corporate profits.) The Downer and Howard acclaimed responsible global citizen is essentially concerned with garnering global opportunities for Australian business. This orientation backs up the major criticisms that NGO and Third World representatives expressed in the lead up to the Johannesburg Summit. Their fear was that, with the support of leading advanced industrial nations, the Summit agenda was effectively hijacked by transnational capital. The achievement of the Summit, they argued in expressing their frustration, was that it merely locked in an essentially unsustainable pattern of development. It resulted in insufficient mechanisms to combat the crisis of global poverty, on the one hand, and merely opened up opportunities for business on the other. For instance, they could point to the principal poverty alleviation measures being defined in terms of the engagement of business, such as is the case with the commitment to increase access to clean water and sanitation which relies on removing obstacles to the privatisation of state instrumentalities. The development programs generated by the Summit reflect the success of transnational business and will likely result in underwriting the concentration of economic power in the advanced industrial economies of the world and the focus of transnational corporations on ever-greater accumulation. Such an emphasis, it has been argued, can only exacerbate environmental degradation. This takes us to the third issue that must be considered, namely the promise afforded by the position Australian delegates successfully negotiated at the Johannesburg Earth Summit. The argument that Australia's position demonstrates a strategic vision for securing the bases of a sustainable future, as should be evident, is obviously contestable. The same can be said about the reckoning that this also makes good economic sense. In considering the wisdom of Australia's intransigence on agreements for progressing sustainable environment strategies, it makes sense to distinguish between the immediate consequences and the longer term possibilities. The major issue of concern facing the Australian delegation attending the Johannesburg Summit was the fear that the Summit could foster agreement to progress the Kyoto Protocol. The delegation was resolutely opposed to this and succeeded in ensuring that Australia's position prevailed. The final resolution on managing climate change resolved that this would not embody any setting of targets to restrict greenhouse gas emissions nor would it require countries to commit to obtaining increased levels of energy from renewable sources. Kemp had more reason to gloat about because the declaration on renewable energy incorporated reference to the inclusion of nuclear energy and so-called '"clean coal" as contributing to renewable energy. Yet whether this can be concluded as a strategically positive outcome is highly questionable. While the Summit did not formally elevate the importance of the Kyoto Protocol it was a catalyst in Canada, Russia and China giving undertakings that they will ratify the Protocol, and this has radically changed the global regulatory context. Australia may well have been incredibly successful in negotiating flexible conditions, generous interpretations on what would be counted as contributing to the level of a nation's greenhouse gas emissions, and international agreement that it would be inequitable for Australia to be required to reduce emission levels to anywhere near those set for other advanced industrial nations. But, in holding out on ratifying the Kyoto Protocol on the assumption that as long as the US refused to embrace the Protocol it would never be enacted, the Australian government has not played its cards at all very well. With the endorsement of Canada, Russia and China, the Kyoto Protocol will now come into force sometime in 2003. This will have significant economic ramifications for Australia. The immediate effect is that Australia will be excluded from the global carbon credit trading system that is to be established under the auspices of the Protocol. Australia played a leading role in negotiating the terms and parameters of the carbon trading system, and some of these were very much to Australia's advantage so it is all the more surprising that the Australia government has remained so immovable. One of the key benefits of the Protocol was that it would provide advanced industrial nations with the opportunity to offset their emissions by in effect buying emission credits in the global market. This would have two definite advantages for Australia. It would firstly enable the big greenhouse polluting nations that purchased Australian coal, or the energy-intensive companies operating in Australia, to offset any restrictions that would be imposed on their emissions by buying credits or investing in carbon sequestration ventures, such in plantations, and thereby countering the possibility that restrictions would result in the reduction of coal exports or energy-intensive productions. A second possible benefit would be that Australia, as a large country, could develop industries that could earn carbon credits, the most notable of which would be plantations but this could also include the production and export of greenhouse-friendly technologies. However, for as long as Australia does not ratify the Kyoto Protocol businesses can not avail themselves of the benefits that would accrue from participating in the tradable emissions permit scheme. The value of carbon abatement credits that would be generated from investments in plantations for example cannot be realised if Australia is not a party to the Protocol. Likewise, there is no added incentive, in the form of earning carbon credits under the Protocol's clean development mechanism, that would encourage investment in the production and sale of greenhouse-friendly technologies to developing countries. The conservative government's approach to the whole issue is replete with ironies. It has invested millions of dollars exploring the possible benefits that could be generated from Australia's participation in a global tradable emissions system. The Australian Greenhouse Office was established and charged with the task of investigating the setting up of carbon trading markets. It has also invested enormous energy and resources in taking very seriously its involvement in the Kyoto Protocol deliberations, negotiating a raft of very agreeable clauses (at least, to the government). Indeed this provided considerable evidence that Australia would eventually ratify the Protocol, and in anticipation of this, businesses and State governments were moved to invest in a raft of schemes that would deliver carbon credits. There are clear costs in not ratifying the Protocol, and the more directly relevant research completed by the Australian Bureau of Agriculture and Resource Economics on the cost and benefits of the Kyoto Protocol for the Australian economy has reinforced this point. The potential loss of investment opportunities merely underscores this making the government's intransigence all the more paradoxical. There are other likely and more substantial shortcomings in Australia's position that ought to have been reckoned upon, and some of these are now beginning to become apparent. The most obvious relates to the future of the fossil fuel and energy-intensive industries. When the Kyoto Protocol came into force, it was apparent that this would have implications for the world demand for fossil fuels as well as prices irrespective of any direct governmental restrictions on industry's use of fossil fuels. However it was always likely to be the case that as individual nations sought to meet their Kyoto emission obligations it would follow that there would be a shift away from the reliance fossil fuels sourced energy. This has already begun to occur. Japan, in its endeavour to reduce emissions, has recently announced its intention to introduce a tax on coal in order to get power generators to replace coal with more greenhouse-friendly fuels. This will have a quite dramatic impact on the future magnitude and value of Australia's leading commodity export. China is following this lead towards utilising cleaner fuels. This shift has already boosted the demand for natural gas, and one would expect that this would be to Australia's great advantage. But, in a repeat of history, some of the buyers of natural gas are very successfully playing suppliers off against one another and negotiating knock-down prices. Much was made of the Prime Minister's recent intervention in facilitating the negotiation of a long-term contract for the supply of North West Shelf gas to China. What was overlooked in the media reports however is that the companies that make up the North West shelf consortium were decidedly disappointed in the terms of a contract that was only marginally more than the cost of extracting and supplying the gas. It is evident that as the Kyoto Protocol comes into force, the Australian economy will be subject to significant restructuring with considerable cost to the population. The impact of this restructuring is likely to be most detrimental for the coal mining industry, and this will have severe and direct implications for employment opportunities within the industry. The effects will however extend well beyond the industry because as the overall value of Australian exports is likely to decline this will have the affect of driving down the value of the Australian dollar. Restructuring will not only result in increased unemployment but it will also see an increase in the cost of living because of our ever-greater reliance on imports of manufactured goods. The position that Australia successfully promoted at the Earth Summit in Johannesburg echoed the position that several peak business organisations and conservative economic think-tanks had represented to the government. It was held that if the viability of the Australian economy was not to be imperiled every effort must be made to resist attempts to establish a meaningful global environmental regulatory and developmental regime. The Australian government's blind adherence to this position has been strategically na�ve. The development of the Australian economy has been premised on promoting the exploitation of coal resources with a view to increasing exports and underwriting the energy-intensive industries. While these industries have generated some employment, they are essentially capital-intensive and, because they are essentially enclave in character, they have generated comparatively few flow-on benefits to other sectors of the economy. The government's defence of these industries has rested on at least three factors. One is simply the belief that Australia has a comparative advantage in mining and energy-intensive industries, and that the government should ensure a regulatory environment to facilitate economic specialisation in these industries. A second is that, if the investment conditions are favourable, the companies engaged in mining and mineral processing will remain committed to retaining their investments in Australian industry. The third and related argument is that Australia lacks any immediately obvious alternative industries that warrant support, notwithstanding the fact that the support afforded mining and mineral processing industries has drawn resources away from other prospective more dynamic and more value-adding industries and most notably from environmentally-friendly technologies. The shortcomings in these rationales should be immediately obvious. The future vitality of the industry, to saying nothing of its viability, is necessarily contingent upon how the post-Kyoto global regulatory regime unfolds. We cannot be assured that capital will retain its interest in the mining industry or the energy-intensive mineral processing industries. Nor can we be assured that capital will maintain its focus on Australia. It is na�ve to think that any of these conditions will continue to hold. In fact, despite their forceful lobbying of the government prior to the Johannesburg Summit as well as on the Kyoto Protocol, unlike the government, industry representatives acknowledge that the regulatory environment will inevitably have to a change. Most of Australia's corporate giants and peak industry councils, including the Australian Aluminium Council, recognise that Australia, as the world's largest per capita emitter of greenhouse gases, will have to face the reality that industry must eventually respond to the challenge of managing greenhouse gases. Ironically, there is a tendency within the labour movement to endorse the position that any regulatory framework that seeks to promote sustainable development and restrict the exploitation of the world's natural resources will be detrimental to the Australian economy. The conventional wisdom holds that workers will be disadvantaged by Australia committing to global environmental agreements. This must be more critically assessed because it tends to lock unions into defending industries that are by and large capital intensive and comparatively insular, low-value added, have few linkages with other industries across the economy, and whose dominance in the economy tends to compromise a more broadly-based and industrial focused economy. The conventional wisdom must be questioned simply because it continues to inform policies for supporting industries that are neither necessarily sustainable nor ultimately viable. The Australian government's role at the Johannesburg Summit reflects a decided lack of vision. It reflects a continuing failure to come to grips with the magnitude of biodiversity loss and environmental degradation globally and more particularly in Australia. It reflects a unilateral disregard for the well being of a growing number of the world's population who are suffering the effects of underdevelopment and environmental degradation. The government's approach to the challenge of sustainable development has been reactive rather than proactive. There is an urgent need to shift this focus, to direct our energies so that we reflect more critically on the strategic and longer term advantages that would be generated by declaring a commitment to promoting environmental protection. In the immediate future, this seems essential if we are to counteract the fuelling of economic malaise. There are immediate and longer term benefits in focusing our energies on investing in the future, investing in the development and employment of environmentally-friendly technologies and in the skill profile of the nation's work force. It is only through such proactive stances that the labour movement will develop the wherewithal for sidestepping the tendency of getting locked into the position of endorsing conservative programs that resist regulatory initiatives that seek to limit the reach of capital. Finally, it is important that we recognise that the government's agenda at the Johannesburg Summit is but one dimension of a larger neo-liberal program. This agenda not only wants to free capital from any regulatory constraints however much these might be laying the foundations for a sustainable future. It is also directed towards quashing the force of organised labour. If we are to put in place the means for building a sustainable world we must challenge the different components of this agenda and begin the task of developing the strategies to lay the foundations for securing more sustainable economic activity and more secure and meaningful employment.
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