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LOOKING TO DURBAN125

evelopments at COP16 in Cancun are an important breakthrough for action tolimit global Greenhouse Gas (GHG)emissions and help to build cleanereconomies. But the momentum must be maintained to COP17 in Durban.Policymakers are currently confronted by staggeringcrises, including the aftermath of two earthquakes inAsia-Pacific, geopolitical upheaval in North Africa, anda still fragile economic recovery. The social impacts ofthese crises are all too evident, as is the need forurgent policy action. Against this backdrop of thevisible and urgent, there is a risk that climate changeand the significant outcomes achieved at theconference in Cancun barely four months ago may fadeinto the rear view mirror of policymakers.Yet, fighting climate change is very much a pressingpriority even in these challenging times. Our societiesneed to do more to enhance their resilience to a widerange of natural hazards, including those exacerbatedby climate change. Meanwhile, mitigating climatechange is not a luxury, but part of the solution totransitioning from a still fragile recovery to a moresustainable growth path. At the OECD, we are lookingat the approaches that can help countries movetowards low-carbon and more resource-efficient growth- greener growth. Ambitious global action to mitigate GHG emissions isnot only necessary, but economically rational. Thepotential that exists to generate sizeable fiscalrevenues from the use of market instruments inclimate policy is especially attractive in current timesof financial hardship. OECD analysis estimates that, ifindustrialised countries were to achieve their emissionreduction targets using only auctioned tradeableTO DURBAN AND BEYOND:MOVING THE CLIMATEAGENDA FORWARD 126LOOKING TO DURBANDANGEL GURR√ćA, SECRETARY-GENERAL, ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT (OECD)02040CHART 1.THE IMPACT OF DIFFERENT OFFSET LIMITS ON THECOSTS OF REACHING THE CLIMATE TARGETS OF ANNEX ICOUNTRIES IN 2020 Source: OECD (2010), "Costs, revenues, and effectiveness of the CopenhagenAccord emission pledges for 2020", Environment Working Paper 22,www.oecd.org/env/cc/econ.0.500.450.400.350.300.250.200.150.100.050.000.400.45GDP costs in %0.290.310.190.19Limit on offsets in %Low & FragmentedHigh & LinkedLow end of pledges, fragmented marketsHigh end of pledges, Linked A1 marketpermits or carbon taxes, they could raise revenues of asmuch as one per cent of GDP (or US$400 billion) by2020. This money could be used to support climatechange action, for example to finance adaptation andmitigation in developing countries. Following theeconomic crisis, revenues could also be used for fiscalconsolidation, while in emerging economies, theycould finance other pressing priorities, such aseducation, health care and poverty alleviation. A successful outcome of the negotiations at the COP17in Durban should include progress on a number ofelements. Policy makers need to move forward on a