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enhanced reporting of climate responses, includingfinancing, in order to increase the transparency andconsistency of country information. Beyond an international climate agreement, tacklingclimate change requires an appropriate policy mix tocorrectly price GHG emissions. An important start is toreform environmentally harmful subsidies that supportfossil fuel consumption or production. OECD analysisfound that removing subsidies to fossil fuelconsumption alone could reduce global GHG emissionsby 10 per cent in 2050 compared with business-as-usual. It would also make the economies undertakingthe reforms more efficient, reduce the burden on scarcegovernment budgets, and alleviate the potentiallydistortive effects of subsidies on competition. Providing clear price signals to consumers is critical toraise awareness, empower choices and encouragehouseholds to save energy and limit emissions. Resultsfrom a survey of over 10,000 households across tenOECD countries confirm the impact of economicincentives on household behaviour. Respondents whoare charged for the energy that they actually use aremore likely to save energy.The results of the survey also confirm the importantcomplementary role played by information-basedmeasures such as energy efficiency labelling ofappliances and housing. Climate policies are also needed to stimulateenvironmental innovation and accelerate thedevelopment and diffusion of cleaner technologies.OECD analysis of innovation in cleaner technologiesindicates that business and other innovators need long-term, predictable and strong policy signals. Beyond theuse of economic policy instruments to price carbon,other demand-side policies may also be central toadvance environmental innovation, including greenpublic procurement, awareness raising campaigns, orthe use of performance standards. Some progress hasbeen made in this regard. For example, the adoption ofthe Kyoto Protocol in 1997 coincided with a sharpincrease in the rate of innovation in climate-friendlytechnologies (Chart 2). However, much of thisinnovation is still concentrated in advanced economieswhich directly regulate greenhouse gas emissions. There are many policies that would encouragedevelopment and diffusion of cleaner technologies indeveloping countries. OECD work shows that countrieswith high domestic technological and absorptivecapacity are more likely to both develop and to benefitfrom cleaner technologies available on internationalmarkets. These capacities are driven by local policiesin developing countries as well as by participation intargeted international research programmes. A keypriority for international climate support should be tofurther strengthen local technological capacity indeveloping countries. International co-operation in128LOOKING TO DURBAN""POLICY MAKERS NEED TO MOVE FORWARD ON A BALANCED PORTFOLIO OF ISSUESPhoto: UN Photo/R Kollarresearch programmes on climate change mitigation isone means of developing such capacity, and the OECDis currently examining how this can be encouraged. The OECD will continue to provide fact-based analysisand present policy options on how to reconcileenvironmental concerns with economic and socialgoals. Besides the work mentioned above, the OECDwill deliver its Green Growth Strategy in May 2011 andwill continue to work on a number of issues relevant for the fight against climate change, includinggovernance, finance and development co-operation.Climate change is the greatest challenge facing

December 1994 to January 1998, Mr Gurría madedialogue and consensus-building one of thehallmarks of his approach to global issues. FromJanuary 1998 to December 2000, he was Mexico'sMinister of Finance and Public Credit. For the firsttime in a generation, he steered Mexico's economythrough a change of Administration without arecurrence of the financial crises that had previouslydogged such changes.As OECD's Secretary-General, since June 2006, MrGurría has reinforced the OECD's role as a "hub" forglobal dialogue and debate on economic policy issueswhile pursuing internal modernisation and reform. mankind today and the OECD is ready to continue towork with all countries to support international climatechange negotiations. nABOUT THE AUTHORAngel Gurría is the Secretary-General of theOrganisation for Economic Co-operation andDevelopment (OECD). He came to the OECDfollowing a distinguished career in public service,including two ministerial posts. As Mexico's Minister of Foreign Affairs from