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2 Nov 2022

Econ Digest

198 countries come together to solve environmental problems towards net-zero goals

        The 27th session of the Conference of the Parties (COP27) to the United Nations Framework Convention on Climate Change (UNFCCC), which is an important international environmental leadership conference, will take place next week November 6-18, 2022 in Sharm El-Sheikh, Egypt1.

        This conference will monitor the progress of 198 parties’ actions to tackle climate change, as many countries announced their targets at the COP26 conference last year, including reduction in energy consumption from fossil sources, especially coal, reduction in methane emissions and reduction in deforestation. At the COP27 conference, the parties will negotiate to establish the Forests and Climate Leaders’ Partnership (FCLP) to collaborate more on forest conservation, in order to reach the net-zero goal by 2050 and to hold global temperature increases to within 1.5 degrees Celsius of ore-industrial levels. The parties will also discuss aiding countries affected by natural disasters. However, the ongoing energy crisis and impact of the Russia-Ukraine war has now affected a wide range of countries; therefore, the actions in reducing fossil energy use may not go as planned.

        In addition, the COP27 conference will focus on the follow-up to the developed countries’ pledge to provide USD100 billion per year in climate finance to the developing countries starting from 2020, a goal that has not been met in the past 2 years2. Further discussions are expected at this year’s conference on expediting the pace at which the wealthy and developed countries fulfill their commitments, as well as on the impact of economic issues and financial crisis, debt burden and current rising interest rates on climate finance.

        The international dialogue on cooperation mechanisms for the development of carbon credit markets under Article 6 of the Paris Agreement is also another important topic to be monitored at the COP27 conference, in order to understand the progress made, especially in terms of rules and regulations for international carbon credit trading. This will require the development of details such as mechanisms and methodologies for establishing international carbon credit trading, qualifications for projects or activities to receive carbon credits, carbon credit accounting for international carbon credit transfer, community protection from the impact of carbon credit projects, and the allocation of a portion of the proceeds from carbon credit trading to the Global Adaptation Fund, etc. These mechanisms will play an important role in driving countries around the world to invest more in projects to reduce greenhouse gas emissions.

        As a member county, Thailand will present the revised Long Term Low Greenhouse Gas Emission Development Strategy (LT-LEDS) at the COP273 conference. Thailand has adjusted its target in reaching peak greenhouse gas emissions to 2025, five years earlier than the former target in 2030, and has increased its normal-case greenhouse gas reduction target to 30-40% by 2030 from the previous 20-25%. The aim is for Thailand to achieve the carbon neutrality goal by 2050 and net-zero emissions by 2065, as announced by the Prime Minister of Thailand at the COP26 conference.

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Econ Digest