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Notes for an address by the Honourable David Anderson Minister of the Environment to the Canadian Institute of International Affairs

Ottawa, 27 October, 2001

May I first salute the Canadian Institute of International Affairs as the only voluntary body in our nation concerned with the entire range of international issues.

As a new Member of Parliament and as a very recent 31 year old retiree of the Department of External Affairs in 1968, I was involved in the Trudeau Government's review of foreign policy. I remember well the major impact which this organization had upon that undertaking. And I remember well the role that John Holmes played as the head of CIIA 30 years ago.

At this time in the life of the nation and the world, the founding statement of the Institute carries more relevance than ever: "To promote a broader and deeper understanding of international affairs and of Canada's role in a changing world by providing interested Canadians with a non-partisan, nation-wide forum for informed discussion, debate and analysis."

The three issues before this conference are the three issues at the top of the government's global environmental agenda.

Let me talk briefly about the first two and then in some depth about climate change.

In the past eight years Lloyd Axworthy and the Prime Minister have placed human security at the heart of Canadian foreign policy. Environmental security builds on this foundation by addressing the environmental threats to human security. Environmental security seeks to provide the world with a healthy, productive and sustainable environment. We now all fully appreciate that there are great threats to humanity and human values and not just to nation states. We must act to address our vulnerabilities.

Equally critical is appreciating that the challenges to environmental security are, indeed, global. Pollution flows across boundaries. Toxics float across oceans. Fossil fuels burned in one country cause climate change around the globe. Infectious diseases touch all humanity.

Next year, Canada will host the first-ever joint meeting of the Health and Environment Ministers of the Americas to put a spotlight on these issues. Next summer, the Prime Minister will, of course, host the G-8. Three months prior and in preparation for that meeting, I will be hosting the G-8 environment Ministers in Banff.

We are already working with our G-8 partners on the new African Initiative. There is no doubt that the overall plight of Africa is a rebuke to all humanity.

And we are working bilaterally with the United States and within NAFTA on hazardous products, air pollution and the preservation of North America's natural legacy.

Next year in Johannesburg, the leaders of our planet will meet for the World Summit on Sustainable Development. They must act together on the vital issues: the environment and the health of the world's children, the environment and poverty alleviation, and the environment and economic prosperity for all.

Incidentally I believe the events of September 11th will greatly heighten the importance of Johannesburg. There seems to me to be a direct link between the anger and fanaticism of today's terrorist organizations and the despair and squalor of the physical conditions in which so much of the world lives.

Thus a commitment of the global community in Johannesburg to a plan of sustainable development appears to me to be a logical, necessary, progression of the military campaign that today fills our newspapers and television screens. World leaders in Johannesburg will need the support of us all.

Canadians have a history of providing such support through leadership at the United Nations Environment Programme. There have been only four Executive Director since UNEP was established following the Stockholm Conference 30 years ago. We can point with pride to the leadership shown by Maurice Strong and Elizabeth Dowdeswell.

As the current Chair of UNEP's Governing Council, I know how much, much more we have to do. Environmental laws, conventions, treaties, institutions and mechanisms have not developed into a coherent or efficient system to address global environmental security.

Canada is determined to play a constructive role in this regard. We are taking a systematic approach. Our Canadian team is working both within the Governing Council and with a wide range of international agencies. And I am discussing these matters one on one with Environment Ministers from around the world.

We need international good will and international machinery and international action to bring about global human security and global environmental security.

The United Nations Environment Programme has established agreements on trade in endangered species, the Montreal agreement on ozone-depleting substances, the convention on Persistent Organic Pollutants, the new agreement on biosafety and the key accord on hazardous chemicals.

We need UNEP to play a larger role than it has in the past in co-ordinating and harnessing the scientific capacity of the world around key environmental issues. UNEP's joint work with the World Meteorological Organization in establishing the Intergovernmental Panel on Climate Change has been instrumental in providing the top-level and objective scientific evidence that has kept the world's focus on this most fundamental challenge. Perhaps, jointly with the World Health Organization, we could do the same for children's health, where the key to success is the environmental component.

We need to ensure coherence along the continuum of multilateral environmental agreements — from policy directions to legal instruments and through to effective implementation.

We need to ensure administrative co-ordination both to eliminate duplication, and to promote more efficient use of time and resources through information sharing, agenda setting and common approaches.

We need to examine compliance mechanisms.

Global agreements need to be more than documents. They must be the catalyst for action. They must be implemented.

In a similar manner, we need an honest examination of capacity building outside of the developed world.

Some agreements have formal approaches for capacity development while others are 'catch as catch can'. Nowhere is the effort really enough, and there is not enough money to make it enough if we follow the traditional recipe. We really need to rethink our global approach to capacity development.

Beyond these issues, as important as they are, come the matters which require serious political commitment. If UNEP is to be more effective, it needs improved funding and financial security, potentially through an agreed system of assessment of member nations of the United Nations. UNEP, as I am sure you know, is now a voluntary organization with voluntary funding. As our efforts proceed, environmental governance must be considered within the broader context of overall revitalization of international institutions. It must also be considered within the overall approach to governance of sustainable development.

We have already demonstrated that we can, in fact, make progress on the tough environmental files. There are many. But let me return to one I mentioned earlier.

Nowhere is that more obvious than with the supremely significant and enormously complex issue of climate change. The world's climate is changing and is doing so at an unprecedented rate. The principal cause is human activity. Without action, the long term consequences will be highly negative. On these facts, the majority of the world's leading climate scientists are in agreement.

According to science, glaciers are receding, the sea level is rising, and climate zones are shifting. The 20th century was the warmest century of the last millennium and the 1990s, the warmest decade of the last century. As the ice cap is melting, the wonders of the Canadian Arctic are being threatened, and so are the Inuit economic base and the food sources of the polar bear. New species are arriving and old ones are disappearing. The amount of carbon dioxide in the atmosphere has increased by 31 % since the beginning of the Industrial Revolution. The present increase rate is unprecedented. Environment Canada's senior scientists predict that if no change is implemented, the global temperature will rise five times more during the next century than during last.

In 1992, at the Earth Summit in Rio, the nations of the world agreed that all countries should work together to reverse this trend. Despite legitimate good will, the world would soon learn that the voluntary commitments made at Rio were not strong enough or clear enough.

In Kyoto in 1997, new global discussions led to the setting of firm targets for greenhouse gas reductions — the so-called Kyoto Protocol.

This summer, at very tough negotiations in Bonn, 178 countries agreed to the basic rules for implementing the Kyoto Protocol. As the discussions in Bonn heated up, the Prime Minister concluded that success was going to require very clear will and action from the top. The Prime Minister explained Canada's goals and determination to other world leaders at the G-8 that was taking place in Genoa. In particular, the Prime Minister engaged in substantive personal discussions with President Putin of Russia and Prime Minister Koizumi of Japan. As we know, the engagement of Russia and Japan was one of the keys to the success of Bonn.

The Bonn Agreement is a good deal for the world and it is a good deal for Canada. Moreover, it is a fair deal.

First of all, it is comprehensive since it considers both sources of greenhouse gases as well as carbon sinks.

Also, the Bonn Agreement gives countries the flexibility they need to cost-effectively achieve their Kyoto targets. Perhaps for the first time, an environmental agreement is based largely on making market mechanisms provide solutions. It was also one whose benefits would largely not be apparent to this generation, but to generations yet unborn. Our initial analysis indicates that such flexibility should cut the implementation costs for Canada by half. In other words, we can do twice as much with the same amount of money.

The Bonn Agreement and the Prime Minister's statement that it opens the way for a ratification decision on the Kyoto Protocol in 2002 — following consultations with provinces, territories, industry and Canadians — have set the stage for a watershed year on climate change. So what does the next year look like?

With a fully implemented Action Plan 2000, and with the favourable conditions contained in the Bonn Agreement, we have effectively positioned ourselves to address one-third to one-half of the action needed by Canada to meet our Kyoto target.

The start of the first commitment period under the Kyoto Protocol is only six years away and important decisions must be made so that we can achieve the other half of our emission reduction target.

Despite this urgency, the process leading to a ratification decision will be thorough. We will make that decision in the same balanced and considered manner in which we made decisions on the Kyoto Protocol and the Bonn Agreement.

My colleague Ralph Goodale, the Minister of Natural Resources, and I have met twice in the past two months with our provincial and territorial colleagues, and we plan to meet again in February and May. Consultations with stakeholders will be resumed this winter. We will also engage the general public and academics in addressing climate change. We want to focus on the best way of achieving the remainder of our Kyoto target. This means harnessing market forces and mobilizing the ingenuity of Canadians.

The Bonn agreement vests the Canadian business community with both responsibility and opportunity. The Agreement creates a global emission trading system. The buying and selling of emission allowances in the world marketplace will provide individual firms, whole industries or entire countries with a powerful tool to meet environmental targets while remaining competitive.

The United Kingdom is already creating an emissions trading system and the European Commission has proposed an EU-wide trading system at the company level. This whole concept is innovative and it is one of the key areas which Canadians must discuss thoughtfully in the months ahead.

A domestic emissions trading system could be an excellent tool to achieve the remaining half of our climate change goals in an efficient and economical fashion. We need to determine what role domestic emissions trading should play, what sectors of our economy should be included, and how the permits should be allocated. We need to determine where regulations and incentives would be the most effective. It is important that we enlarge the circle of Canadians who understand the role domestic emissions trading could play in a strategy to achieve our Kyoto target. Obtaining emission reductions will be particularly challenging in several key sectors, namely transportation, electricity generation and oil and gas production.

Through Action Plan 2000, we are working with the United States and the automobile industry to achieve a 25 % improvement in new vehicle fuel efficiency by 2010. However, this is only part of the solution in the transportation sector.

We also need to start changing consumer behaviour — persuading buyers to purchase the most fuel-efficient vehicle that meets their needs. This will not be easy. Even within government it is an uphill battle.

We need to find the best way of getting more biomass ethanol into our gasoline and diesel fuel supplies.

In the electricity sector, we need technologies that will allow Canadian coal to be burned as cleanly as natural gas. This means coal fired power plants with only a third of the carbon dioxide emissions of present technology.

We want to work with the provinces and industry to demonstrate new, clean and more efficient technologies.

Combined heat and power co-generation can meet the electricity and heating and cooling needs of our buildings with half of the emissions of conventional approaches.

We need to find the best ways of increasing the adoption of these technologies and systems.

We also need to bring more renewable energy from sources like wind, wave and landfill gas on line.

In spite of impressive progress accomplished during the last decade in the area of energy conservation, the oil and gas production emissions keep rising. I believe that this sector possesses the creativity and resourcefulness necessary to make even more progress in energy conservation through better technology and processes. Furthermore, we need to start building the necessary pipelines to capture and store vast quantities of carbon dioxide. For the electricity and the oil and gas sectors, it is equally important to develop the technologies which will make it possible de reduce the costs of capturing carbon dioxide by 50 to 75%. We must find the best possible ways.

Internationally, the top priority is to ensure there is no backsliding on the Bonn Agreement. At Marrakech in two weeks times, we need to get it translated into legal language and we need to deal with the remaining details on the use of the Kyoto Mechanisms and the compliance regime.

Now, we all realize that the two big concerns in Canada about the Kyoto Protocol are the potential impact on economic growth and the competitiveness of our industries vis-a-vis the United States.

The U.S. position on the Kyoto Protocol has placed Canada in a very unique position. We are the only country in the world that will likely have a Kyoto Protocol emission reduction target and will likely be within whatever North American or hemispheric approach eventually emerges on climate change.

Factoring in the Bonn Agreement, we estimate that meeting Canada's Kyoto obligation could reduce our growth by 0.5 to 1 of a percentage point over the next decade. In other words, compared to a base case assumption of 30 % growth over ten years, we would see 29 or 29.5 % points of growth. And that's without taking into account the new opportunities presented by energy efficiency and conservation, clean technologies and alternative fuels, which are substantial and have simply not been considered.

Reducing greenhouse gases means cleaner air, more smog-free days, fewer respiratory diseases among adults, fewer cases of asthma among children, fewer admissions to our hospitals and fewer deaths. This has a financial benefit as well as a human happiness benefit. A recent study from Italy suggests that when we put an economic cost on the health effects of climate change, there is, in fact, a strong net economic benefit to taking action.

Allan Rock and I have ensured that much more analysis on the health savings of cleaner air is under way. This work will take into consideration the complementary analyses being conducted by the international community.

After the grievous events of September 11th, we face additional priorities. Our friends in the United States, and indeed our other allies, face additional priorities. As the Prime Minister has said, however, the world cannot be deterred from its other responsibilities. In the words of the Prime Minister in Toronto three weeks ago: "Clean air and clean water are no less of a priority because of the terrorist attacks in New York and Washington. Addressing climate change remains a global challenge to all countries around the world that has to be met."

We will work on a global, North American, and bilateral basis to encourage significant action by the United States. I am confident we will soon see a robust U.S. climate change plan. While it is highly improbable that the U.S. Administration will return the United States to the Kyoto Protocol, the Administration has already committed to an agenda focused on science research, new technologies and working with developing nations.

We are all aware of the public and Congressional pressure on environmental issues. When I met with U.S. EPA Director Christie Todd Whitman last week, I was encouraged by her assurances that the U.S. Cabinet is continuing work on a greenhouse gas reduction plan that "makes sense for us, and, we believe, for other countries."

And you should know that climate change action is taking place at the state level. Thus far, half the states are working to put comprehensive action plans in place. A very interesting example is the Eastern Canadian Premiers and the New England Governors who have just agreed on a comprehensive and co-ordinated regional plan for reducing greenhouse gases — including specific targets.

Canada negotiated hard in Bonn. We have achieved the deal we need to meet our Kyoto target in a flexible, cost-effective manner. We still have a difficult road ahead. There will be disagreements and debates. But we must balance those challenges against the fact that we are doing the right thing for the future of our planet and the future of our children.

When I was first elected to the House of Commons in 1968, I was fortunate enough to found and be the first Chair of the House of Commons Special Committee on Environmental Pollution. At the time, I don't believe that a single country in the world had a Department of the Environment. Today, just a blink of history later, 178 nations are committed to a decade of individual and shared action on climate change — the most pressing environmental issue before humanity.

As Canadians, we have together shown resolve and leadership on climate change. As Canadians, we can and must continue to do so.

Thank you.

Source: Environment Canada

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