This issue of Policy Quarterly is being published on the eve of one of the most important international conferences in recent history. During 7-18 December 2009, thousands of negotiators and observers will gather in the Danish capital, Copenhagen, with the aim of securing a new global agreement on climate change. A new accord is needed for at least three reasons.

First, in accordance with the Kyoto Protocol negotiated in 1997 under the UN Framework Convention on Climate Change (UNFCCC), Annex 1 Parties (i.e. the ‘developed countries’ of the OECD and the ‘transitional’ economies of the former Soviet bloc) agreed to limit their gross greenhouse gas emissions during 2008-12. This is known as the first commitment period (CP1). If the ‘top-down’ Kyoto mechanisms are to be extended for a second commitment period (CP2) (e.g. another five year period – 2013-17), developed countries will need to agree to new legally-binding targets. These are variously referred to as ‘responsibility’ targets and quantified emission limitation and reduction commitments (QELRCs). Any agreement on CP2 ‘commitments’, and the rules under which such commitments operate, will be required within the next year or so to provide sufficient time to ratify and implement the new arrangements.

Second, although the US signed the Kyoto Protocol, it did not ratify the agreement (and is never likely to do so). Accordingly, it is not bound by any legal obligations during CP1; nor will it be bound by any CP2 agreement under the Protocol. But without the US ‘inside the tent’, or at least bound by broadly comparable, economy-wide and legally binding emission reductions, other Annex 1 Parties may not be willing to accept new responsibility targets. Canada has already expressed its reluctance to fulfill its legal obligations under CP1, and may join the US in favouring ‘actions’ rather than Kyoto-type ‘commitments’. But if Canada walks away from Kyoto-type mechanisms, there will be pressure for others to follow – including Australia, Japan and New Zealand. This would leave just the EU, Norway, Russia and Switzerland supporting binding responsibility targets. Such an outcome would almost certainly be unacceptable to the wider international community, undermine the carbon market, increase the risk of protectionism and create huge uncertainties for business.

Third, under Kyoto only Annex 1 Parties have responsibility targets; developing countries do not have legally binding commitments to reduce, or even limit, their emissions. While this sharp differentiation between Annex 1 and non-Annex 1 Parties was broadly acceptable in the 1990s, this is no longer the case. For one thing, a simple Annex 1/non-Annex 1 divide is unfair: numerous non-Annex 1 Parties now have per capita incomes well over those of the poorest Annex 1 Parties, particularly those of the former Soviet bloc. For another, restricting the emissions of only Annex 1 Parties (or even an expanded list of developed countries) will not avert dangerous climate change: the emissions of developing countries now exceed those of the developed world. Indeed, China’s emissions are higher than those of the US and are rising rapidly – even though its per capita emissions remain low compared with most developed countries.

Moreover, in the absence of a truly global commitment to addressing climate change, firms in developed countries will lobby for concessions from any domestic measures to reduce emissions in order to protect jobs and minimize carbon leakage. New Zealand’s recent experience suggests that such lobbying can be highly effective. Any new international agreement, therefore, requires a more sophisticated and comprehensive approach to the limitation and reduction of emissions.

This is why there is now open discussion about replacing Kyoto with a new and more comprehensive agreement under the UNFCCC. Various models are on offer, including the Australian schedules approach (which would extend legally binding mitigation ‘commitments’ to certain non-Annex 1 Parties) and the draft implementing agreement proposed by the US (which would require all countries, except the poorest, to specify measurable, reportable and verifiable ‘actions’ rather than agree to ‘commitments’).

But the problem will be how to craft any new agreement without unraveling key elements of the global policy architecture so painstakingly negotiated between 1997 and 2005, especially the various flexible mechanisms that form the basis of the international carbon market. To complicate matters, it is not yet clear what the US will be able to offer by way of comparable or parallel domestic policy ‘actions’. Unless the Congress enacts satisfactory climate change legislation before Copenhagen, US negotiators will be in a weak bargaining position – reduced to offering a patch-work of federal and state regulations of individual sectors (such as constraints on automobile emissions under the Clean Air Act). Will this be enough to secure anything in December other than a very high-level political agreement on broad objectives? And what then of New Zealand’s goal of ‘rules before commitments’?

With the Copenhagen conference in mind, this issue of Policy Quarterly includes three articles on climate change or related matters: first, Peter Wilson outlines why New Zealand should not harmonize its emissions trading scheme with Australia’s pending scheme; second, Philippe Boncour and Bruce Burson address the relation-ship between climate change and migration; and third, Alana Cornforth reviews the implications of social psychology and behavioural economics for the design of environmental policies.

Reflecting the plethora of policy issues currently on the international and national agenda, this issue of Policy Quarterly also contains five articles on other important matters: David Bromell discusses the complex and controversial relationship between diversity and democracy; Bob Buckle reflects on the origins and implications of the recent global financial crisis; Mike Reid questions the idea of defining the ‘core’ services or functions of local government (an idea once promoted by Rodney Hide, the Minister of Local Government, but now, thankfully, abandoned); Len Cook and Robert Hughes advance the case for improving the efficiency and effectiveness of our public services by focusing on the most critical ‘value chains’; and Andrew Butcher highlights the need for New Zealand to bridge the gap between its foreign polices and the burgeoning field of international education.

Jonathan Boston