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Russia: Moscow Says It Won't Ratify Kyoto, But Supporters Are Hoping Moscow Will Warm To The Idea

Russian President Vladimir Putin's top economic adviser has announced that Russia will not ratify the landmark Kyoto Protocol on global emission reductions, saying it could threaten the country's economic growth. Without Russia's ratification, the landmark environmental pact cannot enter into force. Will years of international efforts aimed at reversing global warming now have to start from scratch?

Prague, 3 December 2003 (RFE/RL) -- Russian President Vladimir Putin's top economic adviser, Andrei Illarionov, dropped a bombshell yesterday when he announced flat-out that Russia will not ratify the landmark Kyoto environmental pact.

The 1997 Kyoto Protocol aims to reduce emissions of so-called "greenhouse gases" like carbon dioxide that are believed to contribute to global warming by trapping heat in the Earth's atmosphere. The agreement commits industrial states to reduce their carbon emissions by an average of 5 percent, compared with 1990 levels, by the year 2012.

But Illarionov told journalists in Moscow yesterday that Russia cannot afford to sign on: "In its current form, the Kyoto Protocol, if ratified, places significant limitations on the economic growth of Russia. So, of course, in its present form, this protocol cannot be ratified. Other countries -- in fact, most countries of the modern world -- do not impose such limitations on themselves."

The drafters of the Kyoto Protocol would disagree, noting that more than 100 countries so far have ratified the document. As the first global emissions treaty with legally binding pollution-reduction targets, Kyoto is seen by many governments as a singular accomplishment. The document took years to draft. But now, if Russia follows the United States, which refused to ratify the treaty in 2001, also citing economic concerns, Moscow will essentially have killed it.

According to the provisions of the agreement, the Kyoto Protocol enters into effect only after being ratified by states responsible for at least 55 percent of the 1990 carbon gas emissions by industrial countries. The ratification total currently stands at 44 percent, and without Russia -- which accounts for 17 percent of global carbon emissions -- the 55 percent barrier will simply not be reached.

The European Union, as well as organizers of this week's United Nations conference in Milan on climate change, have played down Illarionov's announcement, saying it is aimed at domestic political consumption ahead of legislative elections this weekend.

EU Environment Commissioner Margot Wallstrom told journalists that Brussels is not ready to bury Kyoto just yet. "The Kyoto Protocol is not dead. It has, maybe, held its breath for a little while," Wallstrom said.

Michael Williams, spokesman for the United Nations Framework Convention on Climate Change, tells RFE/RL that the Kremlin does not speak with one voice: "We've heard a variety of statements from Russia over the last few months which have not always been consistent. Certainly from the top, in September, Mr. Putin himself said Russia was not ready at that time to ratify. But he has never said that Russia will not ratify, and so when you look at the signals, at the ongoing debate, we remain optimistic that they will at some point ratify."

Others note that Putin, in recent weeks, while speaking to Italian Prime Minister Silvio Berlusconi and Canadian Prime Minister Jean Chretien, had indicated Russia's intention to eventually ratify the protocol -- although the Russian president gave no timeframe.

Moscow's reluctance to ratify the Kyoto treaty has surprised many analysts, who note that Russia could earn significant income by ratifying the treaty.

Compared with 1990, the year before the collapse of the Soviet Union and its vast industrial base, Russia's carbon emissions have shrunk by a staggering 30 percent. And thanks to treaty provisions that allow countries that under-produce emissions to sell their unused carbon capacity to states that exceed the limit, Russia could be a net beneficiary in the equation.

Susan Legro is former Europe and CIS coordinator for energy and climate change issues at the United Nations Development Program. She tells RFE/RL: "Russia could make money in one of two ways. One way would be to participate in the mechanism known familiarly as 'emission trading,' where they would essentially cash in on the amount of carbon that they had reduced and sell that on a global market. The other way would be to participate in the mechanism known as 'joint implementation,' which simply means that international investors would invest in projects in Russia to reduce carbon dioxide and some of the other greenhouse gases and then they would pay Russia for those credits. So, in either case, Russia would make some money."

Legro disputes Illarionov's contention that adopting the Kyoto Protocol's emissions limitations could crimp Russia's economic recovery. She says there is no possibility of the country returning to its heavy industry heyday, nor will economic growth come from those sectors in the future, even if Russia's boom continues.

"I think there is a lot of room and not merely because the collapse was so large. As you know, the economy in Russia, before the collapse in the early '90s, was skewed towards heavy industry and very energy-intensive types of work. With restructuring and the development of things like a service sector, they're simply not going to be as energy intensive as they were in the '60s and '70s," Legro said.

Over the past decade, since the 1992 Framework Convention on Climate Change was signed, which paved the way for Kyoto, Russia has participated in several pilot emission reduction projects. Japan, for example, has donated money to Russia's giant UES electricity utility to reduce pollution at some of its facilities, with the expectation of future profits from emissions trading within the protocol framework.

All deals will be off if Russia fails to ratify the Kyoto pact. Despite the soothing words from Brussels and other quarters, Legro says this would be a major international debacle: "I think it's a major crisis, because you're essentially looking at going back to the drawing board for something that has been under discussion since the late '80s. I think it's a real problem. There are scenarios that would involve a treaty without the United States. But without the United States and Russia, it would be very difficult to make it work. You lose a lot of the economic effectiveness. I think repeated scientific analysis has shown that in any trading scenario, Russia would be the largest seller of carbon credits in the world, and if they leave this arrangement, your buyers begin to have to look at very expensive options."

Until Putin expresses himself on the issue again, the world will hesitate to take his adviser's words at face value. Experts say there is reason to believe Moscow may, indeed, end up ratifying the treaty but is angling for a compromise on the amount of carbon emissions it would be allowed to trade. Some Russian officials who favor Kyoto have called for a lifting of all limits on such trades, hoping to cash in on Russia's underproduction to maximum effect.

Other, less-publicized bargaining may be going on behind the scenes on unrelated issues, such as increasing trade and reducing tariffs with the European Union -- deals whose importance Putin stressed once again this week.