Statement by the International Chamber of Commerce, the world business organization, at the conclusion of the Third Conference of the Parties to the Framework Convention on Climate Change

Kyoto, 11 December 1997 – Governments have made a start in responding to climate change. As they build on the goals set at Kyoto, they must bear in mind the consequences of their decisions for economic growth, investment and jobs. It is a question of finding the right balance. If governments fail in this, they will find that economic decline is the enemy of the environment.

What happens next will decide whether Kyoto is an empty promise or an initial step in addressing the long-term challenges of climate change. It would be counter-productive to strangle business enterprise by imposing rigid regulations in the mistaken belief that this would be the best way to get results.

Having established a framework for action, governments must leave business free to introduce the process, product and technological changes that will make reality out of the targets and timetables. Business is central to the solution. Tried and tested new technologies are already producing spectacular energy savings in manufacturing, transport, domestic and commercial heating, agriculture and other industries. More technologies are coming on stream and performance is improving all the time.

Business must be given support to develop environmentally friendly and energy efficient technologies. The best hope for involving developing countries in measures to mitigate climate change is to make investment and technologies available to them. Developing countries' ability to replace outdated industrial infrastructures will be crucial to achieving meaningful global results.

Predictability of government process is another business requirement. Investment cycles in many areas, like the provision of new power generation plants, are over several decades. Car fleets are not replaced overnight, but over 10 years or more. New technology is almost invariably more energy efficient than the technology it replaces. Government measures to implement the Kyoto agreement must take account of such realities. Improved energy performance is not something that can be turned on like a light switch.

Much of the developing world is entering a phase of rapid economic expansion, in particular India and China. Since developing countries' energy demand - and reliance on fossil fuels - will outstrip that of the developed countries in the next century, it is essential that these nations be involved in measures to limit growth in greenhouse gas emissions as quickly as possible.

To make the disciplines of today's agreement less burdensome to national economies, the promises of emissions trading and joint implementation must be developed in the fourth Conference of the Parties. Competition on open markets will stimulate industrial activities that are part of the solution to climate change. There will be new job-creating business opportunities in such areas as waste management and energy efficiency.

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