Blog: A myopic national approach can cause as well as solve problems

Nicholas Walters

Director, Communications and Public Policy, worldsteel

A myopic national approach can cause as well as solve problems  | 24 January 2017

There has been a period of quiet since the Marrakech meeting (COP22) ended last November, which is not entirely surprising. It is going to take a while for the consequences of the Paris Agreement (COP21) to sink in and in Marrakech this was not entirely helped by the US election result which came out right in the middle of the meeting, at the end of the first week.

The Paris Agreement solved the major problem of establishing a consensus because it turned all responsibility upside down. The future is now a bottom-up approach based on the Intended Nationally Determined Contributions (INDC’s), a classic piece of UN jargon calling for national action plans to reduce greenhouse gas emissions. This approach was much more acceptable because it stopped all discussion of top-down imposed targets. So far so good as all engaged countries signed up and followed through by producing plans by the October 2016 deadline.

But of course, this left the Marrakech meeting with a whole raft of issues. Most notably that there is no common framework for all the INDC’s which have been lodged. So anyone having to look through them is faced with a hugely different array of accompanying information, time frames, reference years or metrics. Very little was solved at this meeting and negotiations will continue for several years.

The problems the UN has with a national approach in a global market is matched by the steel industry as we see the widest possible set of national options being taken up for carbon costing. The industry globally is extremely competitive and transparent, and this requires all steel producers to constantly adjust to changing market and economic conditions in order to remain competitive. It is clear that the global economy is best served by steel markets that are as free and fair as is possible. This is going to be very difficult to maintain if a plethora of carbon costing mechanisms begin to distort pricing in different markets.

Please leave your comment here.

  • 1

    Indeed, the steel industry needs as much transparency as possible to remain balanced and competitive. Sophisticated national carbon emission regulations can potentially disrupt regional markets causing social unrest and jeopardizing economic growth in general. A more prudent and balanced approach acceptable to all interested parties including steel producers is needed. There is still some time to convey the industry position and calculate possible trade-offs and consequences of particular regulations. The next major climate change meeting will be held only in 2018.

    avatarAndrey Laptev, SeverstalApr 28, 2017 11:10:13 AMReply

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