New Zealand is pushing for changes to a new international climate change agreement which could result in broader consensus on reducing global agricultural emissions.
Trade Minister and Associate Climate Change spokesman Tim Groser has been in Europe and the United States this week and said there appeared to be a mood change in support of the New Zealand-initiated proposal that developing countries address their greenhouse gas emissions and that research was needed to reduce agricultural emissions, rather than simply taxing them.
Speaking to the Otago Daily Times from Washington DC earlier this week, Mr Groser said developing countries contributed more than half of all greenhouse gas emissions (GHG) and should be included in a successor agreement to the Kyoto Protocol, now being negotiated and to take effect from 2012.
Agriculture accounted for 21% of India's GHG profile, 58% of Brazil's, and a massive 85% of Uruguay's.
"If you think you are going to do a deal for the second commitment period without developing countries, you're dreaming."
But including developing countries in a climate change agreement meant the inclusion of agricultural emissions.
Food production needed to double in the next 40 years but at the same time, GHG emissions needed to reduce by 50%.
"There isn't enough mitigation potential in other sectors for agriculture not to be part of the solution."
A commitment from developing countries would be a major gain for New Zealand, the only developed country where agriculture accounted for most of its emissions.
But getting agreement was not easy, according to Mr Groser.
From his experience as a trade commissioner, he said including agriculture commitments in a new climate change agreement would be viewed by developing countries as a threat to their food security.
"I know from my days in international agricultural politics that if you ask developing countries to do the right thing by climate change at the expense of food security, they will not do anything about climate change."
There was nothing more sensitive to developing countries than food security.
This required a rethink in the international approach to climate change to include greater investment in research to address agricultural GHG emissions. New Zealand had a vested interest as it was the only developed country with an agricultural GHG emission problem.
"That is why New Zealand is establishing a virtual world research centre of agricultural greenhouse gas mitigation.
"The idea is to draw together international researchers and funding in a cohesive approach to finding collective solutions to this challenge."
Mr Groser said this could see New Zealand take a leadership role similar to that which it has in international agricultural trade.
"We need a scientific solution to reduce agricultural emissions."
Mr Groser told the international food and agricultural trade policy council seminar in Austria this week that unless the number of countries committed to a new protocol was widened, emission reduction targets would not be reached and there was the risk of carbon leakage: production being moved from developed to developing countries to avoid emission penalties.
"The problem is global, and at least from New Zealand's perspective, we can define the goal: to stabilise global emissions at no more than 450 parts per million of CO2 equivalent. If we don't have broader participation, there is no possibility of reaching that goal. Forget even more ambitious targets such as 350 parts per million."
International climate change and trade liberalisation policies were linked, he said, but equally there could be a distortion in international trade.
A carbon tax or emissions trading scheme imposed in one country could result in carbon leakage, or another country retaliating by imposing tariffs and other trade restrictions, he said.
"Simply, I suspect that those politicians in various countries who today believe there is a simple fix to carbon leakage through unilaterally imposed carbon-tax adjustment do not actually intend to put a time-bomb under the world trading system.
"But there is no doubt in my mind that that is the risk."
He told the international audience New Zealanders had asked why an efficient agricultural producing country that put a price on carbon, could become uncompetitive against a less efficient country that did not?
"We can see that a shift in production away from New Zealand would not only cause economic damage, but would be a net addition to global warming; the carbon leakage part of the argument."
Mr Groser said if done correctly, World Trade Organisation (WTO) and climate change agreements could result in outcomes that supported each objective.
He was optimistic the WTO Doha Round would be successful in freeing up trade, while Kyoto was the first attempt at a multilateral agreement to address climate change.
He said both initial agreements failed to deal with agriculture, clothing, textiles, and services trade and omitted many non-tariff barriers and developing countries.
"In time, all of these deficiencies were substantially addressed," he said of international trade policy.
Freeing up trade would liberalise the exchange of environmental goods and services and reduce environmentally harmful subsidies, discourage fossil-fuel use and encourage globally optimal efficient production.
"Freed from subsidies, agriculture will move towards globally rational and efficient production patterns."
Under the Kyoto Protocol, Mr Groser said there was no way to capture emission-mitigation action being used by developing countries, and a system needed to be created to encourage the sharing of ideas to reduce emissions.
Mr Groser said while there was no tangible evidence his thinking would be reflected in a new agreement, he and his officials were heartened by the reaction of some of the world leaders.
"We sense a mood shift," he said.
"It is certainly good from our point of view."
