Could a Tax on International Travel Fund a Country’s Response to Climate Change?

Countries most vulnerable to climate change are often the ones with the least financial resources to respond, and rich countries, which are accountable for the majority of global greenhouse gas emissions, are failing to support them.

In response, six climate finance experts on Thursday called for radical reform to the ways in which international climate finance is organized, The Guardian reported. In their article published in Nature Climate Change, the experts suggest innovative finance options like taxing international transportation to create steady flows of finance to countries that need it most, The Guardian reported.

Despite a pledge made in the Copenhagen Accord of 2009, rich countries are failing to provide US$100 billion a year by 2020 to support poor countries dealing with climate change. This is partly due to undefined rules on what kind of climate finance counts, the experts wrote.

"The original pledge stated that "this funding will come from a wide variety of sources, public and private, bilateral and multilateral, including alternative sources of finance", but specified no rules on what could be counted in those categories," the experts wrote. Over a decade later, the experts warn that accounting climate finance remains "deeply flawed," The Guardian reported.

A small number of countries contribute to the majority of global greenhouse gas emissions, The World Resources Center reported. While China is the world's biggest emitter, it is followed by the U.S., emitting 13 percent of global greenhouse gas emissions. Yet countries with the smallest carbon footprints are still at risk for extreme weather and poverty, exacerbating global inequality.

A lack of action by developed countries could, for example, force 100 million people into extreme poverty by 2030, The Brooking Institute reported. In response, participating countries of COP 16, in 2010, created the Green Climate Fund, an entity meant to decide on climate finance policies and priorities, UNFCCC reported.

Yet this program, including the UN Environment and Development Programmes and the Global Environment Facility, remain underfunded, the experts added, and dysfunctional climate finance systems continue to stand in the way of global efforts to support the countries most at risk of climate change.

"There is not a clear accounting system. The definitions of what constitutes climate finance are vague, and there are many flaws and discrepancies," Romain Weikmans, a co-author of the article told The Guardian. "It is impossible for now to say whether the $100bn pledge has been met or not. The parameters are so vague that it is impossible to give a definitive answer."

The authors call for countries to first determine their climate pledge's based on a vulnerable country's needs and then create tangible plans to reach these funding goals. For example, charging a tax on international flights could create steady flows of climate finance to help poor countries, The Guardian reported.

Based on a 2011 study, published by the International Institute for Environment and Development, a small charge to travelers taking flights could help raise US$10 billion each year. Taxing bunker fuels, high-carbon fuels used by ships, could also supply steady income streams, The Guardian suggests.

Implementing innovative solutions to help countries transition off of fossil fuels and adapt to climate change could be led by the new U.S. administration. For example, John Kerry, President Biden's new climate envoy, told global leaders last month at the Climate Adaptation Summit that "We intend to make good on our climate finance pledge," Reuters reported.

This promise is followed by President Biden's recent executive order, "Tackling the Climate Crisis at Home and Abroad," requiring his team to develop a climate finance plan.

"Developed countries continue to avoid fundamental accountability issues by taking advantage of ambiguous technicalities in reporting standards," the authors wrote. As the United States steps back into the Paris agreement, an organized climate finance system could help the world's second-largest emitter lead the way in supporting countries most at risk for climate change. "Now is the time to begin that effort with ambition and accountability to build enduring trust and resilience," the authors added.

20 February 2021

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