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Economics of climate change addressed at OECD Council Ministerial in June
Addressing the challenges brought about by climate change demands a long-term perspective as well as international dialogue in order to reach viable solutions. In addition, for government policymakers, understanding the economic costs and benefits of policy recommendations is critical to their formation and effectiveness.
It is for this reason that this year’s OECD
Council Ministerial Meeting in June is an important milestone as
finance and economics ministers from OECD and other countries will
discuss the economics of climate change. In advance of the
Ministerial, BIAC’s Economic Policy Committee, at its March OECD
consultation, provided detailed input to the first draft OECD paper
on the subject.
Recognising the quality of the OECD analysis, BIAC highlighted a number of concrete points on how to further improve the policy suggestions currently presented by the Organisation. These included the recommendation to not solely focus on pricing and taxes, but to also give additional attention to the impact of innovation and the deployment of new technologies, voluntary initiatives, the overall investment requirements in the energy sector, as well as micro-economic implications of climate change measures. Furthermore, in addition to mitigation of global CO2 emissions, due attention should be given to policies aimed at addressing adaptation to climate change.
BIAC also warned about the
huge risks of trade conflicts that could be triggered by border tax
adjustments, which have been raised by some OECD countries to push
other countries to reduce their greenhouse gas emissions more
rapidly. BIAC encourages the OECD to voice strong concerns about
such approaches, which are extremely complex, difficult to
implement, and could trigger retaliation measures with negative
consequences for trade liberalisation efforts.
In preparation for the
Council Ministerial, BIAC prepared a statement summarising its
views on key considerations when considering the economics of
climate change.
Please contact
Hanni Rosenbaum or Dirk Manske at the BIAC Secretariat for more information.
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