Let’s go back to 1996 for a second. Joint Implementation (JI) and its reincarnation under a new name, Activities Implemented Jointly (AIJ) had been rejected by most non-governmental organisations (NGOs) and countries of the South as merely loopholes allowing industrialised countries to avoid the transformations that are absolutely necessary to avoid a climate catastrophe. Defenders of JI and AIJ argued that it was necessary to assist the South achieve sustainable development, and avoid excessive costs to industrialised countries for domestic reductions.

In the midst of this controversy, in the negotiations leading up to Kyoto, the Brazilian negotiators introduced a creative scheme for allocating industrialised country commitments based on the polluter pays principle, along with a compliance mechanism involving financial payments to a ‘Clean Development Fund’ by industrialised countries who exceeded their targets, to be used to finance sustainable development activities in the South.

In Kyoto, the Brazilian Proposal was transformed into the Clean Development Mechanism (CDM), through which industrialised countries could voluntarily purchase credits from activities in Southern countries, to use to meet their own commitments. It was in fact, the third reincarnation of JI and AIJ, with no fixed commitments for domestic reductions on the part of industrialised countries, and no fund for developing countries to help transform their economies along sustainable lines.

The original fund proposed by Brazil could have provided developing countries with resources to transform key sectors along a less carbon-intensive path, and integrating these changes into reforms in national and local policies.

Instead of being able to address key sectors in a comprehensive manner, the CDM now would only support activities on a project basis, with Southern governments and societies being relegated largely to the passive role of reacting to project proposals. And a disturbingly large number of project ideas involve ideas, which have a dubious impact on host country environments and societies, such as large-scale hydro projects and monoculture plantations supported through payments for carbon sinks, with a focus on corporate and industrialised country desire to avoid essential internal transformations, and on achieving the lowest possible cost per tonne of carbon credits.

The idea that the fund would be used to promote sustainable development — the key element of the original proposal — was moved into the background in the JI/AIJ/CDM’s current formulation. Host country governments are left to interpret this provision, in any way they see fit, with no criteria provided or even any requirements for transparency or public involvement. (In fact, when NGOs asked the CDM Executive Board here at CoP-8 to include requirements for transparency and involvement in decisions about the sustainability provisions, they were accused of wanting the EB to play a ‘big brother’ role.)

The rather predictable results will be a very uneven treatment of this issue, with many countries paying little attention to environmental sustainability, much less to the needs of local communities and impacts on them. It would be a terrible irony, if a mechanism for ‘clean development’ led to a movement of affected communities protesting CDM funded projects. So now NGOs and Southern communities are faced with the choice of struggling to avoid the damage from CDM by focusing on resisting the damaging projects, or trying to carve out a space in this unwelcoming environment for some positive activities.

The ‘not so clean’ development mechanism has been the stage for clashes between NGOs on one hand, who don’t want a CDM that does not contribute to decarbonising host country economies through, for example, energy efficiency and new renewable energy sources, and on the other hand, those interested in seeing the CDM come into existence without effective rules to ensure that it does contribute to sustainability and mitigating climate change.

There is a risk here of diverting energies of all parties from the essential issue — the need for deep cuts in global emissions, led by the industrialised countries and based on an equitable sharing of our planet’s limited capacity to absorb humanity’s greenhouse gas emissions.