From Sri Lanka, a proposal to trade debt against carbon credits

A striking idea from Sri Lanka, reported on by IPS: Little Sri Lanka wants developing countries to be able to trade their debts against the environment destruction and climate change attributed to the developed nations. Piloting the idea is Sri Lanka's environmental minister Champaka Ranawaka, a maverick politician who may be taking on more than he can chew by trying to rally undeveloped nations around the concept of ‘environmental debt’ owed by the richer countries.

"We have a right to live; a right to develop, but that is being blocked by richer nations," the minister, a qualified engineer, told IPS in an interview. Ranawaka and his aides want to take the idea of environmental debt to the main forums of the world and convince the richer nations to exchange their debt claims from borrower-countries against environmental damage caused.

"Our foreign debt is 1.35 billion US dollars but our environmental cost is much higher because richer countries have polluted our environment and we are told to forget development," he said. "Forget GSP Plus or other trade concessions -- we should be able to trade off our environmental burden against loans and trade benefits. The U.S. has already exploited our resources and retarded our development. Now they must pay for it." Currently the only form of payback to developing countries for carbon emissions by richer countries is the carbon trading mechanism developed under the United Nation’s Kyoto protocol. Carbon trading is a market-based mechanism for helping mitigate the increase of CO2 in the atmosphere. Carbon trading markets bring buyers and sellers of carbon credits together with standardised rules of trade. A handful of Sri Lankan companies are already involved in this exercise.

Environmentalists tend to agree with Ranawaka's rational views on the environment, but believe it would be a huge uphill task to convince the international community to accede to such a proposal. "He may be irrational in his views on the ethnic conflict but he is well read and intelligent on the environment and on many other issues," one environmentalist said…..

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