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" "Presidency of the G20, whose first meeting will againbe in Canada, also does not appear to be prioritisingclimate change. The MEF's initial activity in 2010 hasnot been focused on achieving a deal that can be putto Cancun. The world and its leaders have many otherproblems. Copenhagen brought the leaders together,but the experience was not a comfortable one Thelegacy of Copenhagen is that leaders may be cautiousbefore engaging again, and so the seeds of anotherCatch-22 are sown: the climate problems are toodifficult to be solved without the engagement ofleaders, but in the absence of clear possibilities forsolution, leaders can get no purchase on the issues.Against this background, the UNFCCC has done itsbest to absorb the elements of progress in theCopenhagen Accord by getting many of its ideas into anew negotiating text - the Ad Hoc Working Group onLong-term Cooperation Action under the Convention,released in May. This key document is likely to definethe progress achievable at Cancun and perhapsbeyond. The text ducks the issue of the form or legalnature of an eventual agreement. But it cannot duckthe issue of the nature of the long- and medium-termemissions reductions, and there is still much divisionand potential for bitterness among the Parties on thisissue. More helpfully, the document finds ways ofexpressing the need to undertake and record emissionsreductions by developing countries, and support fromdeveloped countries, that could build on theCopenhagen Accord.One of the few areas of the negotiations on whichsignificant, though still patchy, progress has beenmade over the past year has been on deforestation, andthe text captures the main outlines of a possibleagreement here even though there are many difficultdetailed issues yet to decide. The text has a great dealLeft: President and CEO,The InternationalEmissions TradingAssociation (IETA), Henry DerwentRight: Following theCopenhagen Accordsome progress has beenmade on the thorny issueof deforestationONE OF THE FEW AREAS OFTHE NEGOTIATIONSON WHICH SIGNIFICANT,THOUGH STILLPATCHY,PROGRESS HASBEEN MADE OVERTHE PAST YEARHAS BEEN ON DEFORESTATION064EMISSIONS TRADINGto say about adaptation, capacity-building and theconsequences for developing countries of responsemeasures taken elsewhere in the world. It has longbeen clear that there can be no progress withoutdetailed agreement on these issues, and the text showsno obvious possibilities for serious division betweenthe parties if trust and momentum begin to build up.Technology transfer is made the subject of some newinstitution building covering areas that have been well-discussed, but the old question of dealing with thevalue of intellectual property rights in low-carbontechnologies is stated yet not resolved. Much attention is given to new financing mechanismsand structures. Here the ultimate test will be howmuch money the developed countries are prepared toput on the table. This is always the last item to beagreed in negotiations of this kind; in the meantimethe importance of the issue is signaled by a complexset of institutional proposals which will raise the highlysensitive area of governance of the institutions and themoney they are given to deploy. But the major issue ofconcern to this writer, and probably to the ultimatesuccess of the negotiations given that Governmentfinances across the world are so constrained, is privatefinance: how far the obligations of the developedcountries can be fulfilled by opening the door to privateinvestment rather than providing direct financingthemselves; and how to achieve the long-debatedobjective of scaling up the existing Kyoto mechanisms.The negotiating text does not inspire confidence onthese points. But it does open some doors a crack andoffers options for progress towards a new set of privatefinance mechanisms that could make a difference.Which is essential, because without that progresstowards turning private money towards climateobjectives, Governments will, under present economic

BIOGRAPHYHenry Derwent is President and CEO of theInternational Emissions Trading Association, the oldestand largest non-profit membership organisation ofcompanies with an interest in carbon pricing, frommany countries and economic sectors. Before joiningIETA in 2008, he had for over 10 years beenresponsible for international climate change, andvariously for domestic climate policy, sustainableenergy, air quality and other environmental and energyissues in the UK Government. Before that again he wasa corporate finance executive in a major investmentbank, working on public-private partnerships.EMISSIONS TRADING065circumstances, shy away from addressing the issueswith the firmness and timeliness needed. And then noamount of repositioning the negotiations between theUNFCCC, the G8, ad hoc meetings of Ministers or top-level debates between world leaders will help us. nABOUT THE INTERNATIONALEMISSIONS TRADING ASSOCIATION(IETA)VISIONIETA is dedicated to:. the objectives of the United Nations FrameworkConvention on Climate Change and ultimatelyclimate protection; .the establishment of effective market-based tradingsystems for greenhouse gas emissions bybusinesses that are demonstrably fair, open,efficient, accountable and consistent acrossnational boundaries; and . maintaining societal equity and environmentalintegrity while establishing these systems. GOALS AND OBJECTIVESIETA will work for: . the development of an active, global greenhousegas market, consistent across national boundariesand involving all flexibility mechanisms: the CleanDevelopment Mechanism, Joint Implementationand emissions trading; . the creation of systems and instruments that willensure effective business participation. To be the premier voice for the business communityon emissions trading, the objectives for theorganisation are to:.promote an integrated view of the emissions tradingsystem as a solution to Climate Change;.participate in the design and implementation ofnational and international rules and guidelines; and.provide the most up-to-date and credible source ofinformation on emissions trading and greenhousegas market activity. Source: