Outcomes-based financing: Possibility and promise in global health


Outcomes-based financing: Possibility and promise in global health



Climate Change and Global Leadership

An intermediate grouping between the G8 and the U.N., which includes China and India, is best suited to deal with the challenges of climate change and energy security.

The science of climate change has accumulated over many decades to become compelling. The politics has changed with a startling suddenness so that previously sceptical leaders in Australia, Canada, and the United States, for example, are scrambling to catch up with the firming convictions of their electorates that serious action is urgently needed. The two recent reports by Nicholas Stern in the United Kingdom and the Intergovernmental Panel on Climate Change, chaired by India’s Rajendra Pachauri, were major catalysts for the dramatic mood swing in world public opinion.

Global climate change poses significant risks to the planet, and all nations have an important stake in addressing this new threat that is already sufficient to make collective action both necessary and urgent. The IPCC, drawing on around 2,500 scientists worldwide, has confirmed in stark figures, if dry words, the gravity of the problem: by 2100, temperatures will rise by 1.1 to 6.4 degrees Celsius and sea levels by 7 to 23 inches. This is “very likely” caused by human activity.

Based on scale, magnitude, and irreversibility, global climate change constitutes a critical security issue. There is a need for action by all and a need for action now. Delay in acting on climate change now will mean that the costs of addressing it later, according to the Stern report, will be significantly greater. The technical challenges will also mount with growing complexity.

Dealing with climate change is difficult because its dimensions are cross-sectoral, while international organisations, processes, and mechanisms are limited by their mandates and portfolio boundaries. The puzzle is a global common problem, but government representatives act in their own national interest.

We offer a two-track way forward. First, following President Dwight Eisenhower’s wise maxim that the way to solve a difficult problem is to make it even bigger (which then brings attention and resources), we propose to change the question to the broader crisis of energy security. Secondly, we propose a new grouping that is more broadly representative than the G8 yet not so prone to policy paralysis as the universal United Nations.

Along with steps to combat climate change, action is also needed now on energy efficiency, conservation and diversification, and adaptation. New technological innovations are urgently needed. Governments must encourage private sector efforts on research and development (R&D). They should use policy tools, including taxation, to enhance market signals, which provide incentives for long-term investments in those technological innovations, new energy-use applications, and energy-producing facilities that will have significant impacts on carbon emissions and climate change.

To accommodate future population and economic growth, new methods are required for the development of alternative sources of energy supply to reduce global reliance on oil and conventional coal, including greater use of nuclear energy and hydroelectric power, even while promoting the use of non-fossil fuels and renewable sources of energy.

On the second track, of the best forum for making collective decisions on difficult issues, the sad fact is that the distribution of hard and soft power in the real world is increasingly disconnected from the distribution of decision-making authority in intergovernmental organisations. The United Nations is too large, cumbersome and unwieldy, with powerful centrifugal pressures overwhelming collective decision-making.

Some of the crucial decisions regarding Kosovo in 1999 were made at the G8 summit in Bonn, not in the U.N. Security Council. East Timor was handled in the informal corridors of the APEC summit in Auckland. Both were subsequently endorsed by the Security Council to give them the necessary veneer of global legitimacy. For actually making the hard decisions, the informality and personalised style of summit meetings between leaders who know and are comfortable with one another cannot be substituted in the formal forum of the U.N. as an intergovernmental organisation.

Meeting together at summits, leaders — Prime Ministers and Presidents — have a unique role to play. They can provide a collective vision and catalyse collective action. They are not limited by individual departmental mandates. They can resolve inter-ministerial tradeoffs and transcend sectional interests.

But the G8 is a self-anointed exclusive club of the rich and powerful. It simply is not credible any longer to exclude China and India from decisions on global issues. Yet neither belongs to the G8, and India is not a permanent member of the U.N. Security Council. Drawing them into a new summit grouping that bridges the North-South divide would serve also to make them more responsible and responsive while giving greater voice to the global South.

The evolution of an existing informal intergovernmental process is more likely to succeed than the comprehensive reform of existing organisations: for all the effort expended in U.N. reform over many decades, the results are decidedly underwhelming.

Reflecting this, key leaders have taken to talking of the formula of G8+5 (Brazil, China, India, Mexico, South Africa). There are two problems with this. First, the five are guests at the table. They are not involved in setting the rules and the agenda, have no sense of ownership, and feel no sense of responsibility for the decisions and outcomes.

Secondly, the group does not include any Islamic country. Adding Egypt, say, gives us a leaders’ group of 14. Can the G8 be enlarged into an L14 as a new, important pillar of institutionalised multilateralism? How might the current hot topic of climate change be handled by such an intermediate grouping between the G8 and the U.N.?

The central question facing leaders, parliamentarians, and policy makers is who is going to pay for the costs of addressing global climate change and how the costs will be shared.

There is a special responsibility on the part of advanced industrial countries, which account for the largest share of the current levels of carbon emissions in the atmosphere. Yet they insist on meaningful binding commitments from developing countries who query why they should not aspire to raising their own standards of living, and why any sacrifices should not be borne by developed countries.

Both industrial and emerging market economies need to acknowledge their common but differentiated responsibilities, to accept an equivalence of burden-sharing, to see that all countries take national action on climate change, and to negotiate an effective regime aimed at stabilising global levels of carbon emissions within agreed acceptable targets.

Because current levels of affluence in industrial countries have been directly associated with cumulative carbon emissions, they must provide financial and technical support to developing countries for them to achieve sustainable economic growth and social equity.

Leaders, parliaments, and policy makers from L14 countries can make an important contribution to global cooperation on climate change by channelling results of their collective efforts into the U.N.-centred negotiations so as not to lose international legitimacy. But only leaders can confront some major inconvenient truths. Past emissions continuing to change global climate for several decades more, rising demand for oil, energy as the engine of development growth, and intensifying volatility in the Middle East need to be addressed in the short term of the next decade alongside the major inconvenient truth over the course of the 21st century. Urgent energy needs now for developing and developed countries have somehow to be reconciled with longer-term goals of halting and reversing carbon emissions and global warming.

Of course, such a new L14 grouping would not fade and disappear after resolving the international impasse over climate change. It could be just as useful in breaking some other major global deadlocks like the Doha trade talks and nuclear non-proliferation and disarmament, to name just two more important issues.

© The Hindu