Tuesday, May 22, 2012
Where There's A Will - There's A Way
The Grenada Hotel and Tourism Association Members (GHTA) were treated to a presentation by Ethical Ideas (me!), titled "Grenada's Sustainable Tourism Future" last evening at the True Blue Bay Resort. The presentation outlined what we have done to-date, such as defining, voting upon and circulating the GHTA Earth Day Declaration. The presentation also profiled some of the things we are learning such as:
Converting to renewable (solar) energy isn't as easy as it sounds.....
The cost of setting up individual solar systems is one problem - because the electricity rates offered by the local utility GRENLEC are so low, commercial financing options are not viable. Grant funds are available but they take a long time to obtain and will not be sufficient to cover individual properties if the grants are obtained with a 'small project' fund. There is also the challenge of maintaining grid stability, which apparently could be affected if a bunch of properties started generating large quantities of solar power. It's starting to look like we'll need a feasibility study if we have systems put on hotel roof's, and it's not even clear if is this is the right way to go yet.
It may be wiser to look at National renewable solutions instead.......
This isn't set in stone of course, but it does look like the more practical route would be to convert ALL OF GRENADA to renewable energy. I've been told by a very reliable expert that the most cost-effective option for national conversion would be to aim for 70% renewable with a diesel back-up system. There's technical reasons for this (That are beyond my understanding!) that are apparently very costly to solve if we want to go 100% solar. Based on expert input, a national conversion would cost about $90 million USD! That's a lot of money!!! But...
Where there's a will, there's a way!
So, the Members have been given a briefing on where we're at, what I plan to do to keep the ball rolling in the right direction and we press onwards!!! The Grenlec Marketing Manager was present at the Members Meeting yesterday and the Members sure gave her a hard time, expressing frustration at the high electricity prices and arguing that it is in no-one's interest to be one of the most expensive countries in the world for electricity prices. I looked up figures for that argument today and found that indeed - Grenada is among the top 10 countries in the world for high electricity prices. The only country I could find with higher electricity rates was Tonga.
Converting to renewable (solar) energy isn't as easy as it sounds.....
The cost of setting up individual solar systems is one problem - because the electricity rates offered by the local utility GRENLEC are so low, commercial financing options are not viable. Grant funds are available but they take a long time to obtain and will not be sufficient to cover individual properties if the grants are obtained with a 'small project' fund. There is also the challenge of maintaining grid stability, which apparently could be affected if a bunch of properties started generating large quantities of solar power. It's starting to look like we'll need a feasibility study if we have systems put on hotel roof's, and it's not even clear if is this is the right way to go yet.
It may be wiser to look at National renewable solutions instead.......
This isn't set in stone of course, but it does look like the more practical route would be to convert ALL OF GRENADA to renewable energy. I've been told by a very reliable expert that the most cost-effective option for national conversion would be to aim for 70% renewable with a diesel back-up system. There's technical reasons for this (That are beyond my understanding!) that are apparently very costly to solve if we want to go 100% solar. Based on expert input, a national conversion would cost about $90 million USD! That's a lot of money!!! But...
Where there's a will, there's a way!
So, the Members have been given a briefing on where we're at, what I plan to do to keep the ball rolling in the right direction and we press onwards!!! The Grenlec Marketing Manager was present at the Members Meeting yesterday and the Members sure gave her a hard time, expressing frustration at the high electricity prices and arguing that it is in no-one's interest to be one of the most expensive countries in the world for electricity prices. I looked up figures for that argument today and found that indeed - Grenada is among the top 10 countries in the world for high electricity prices. The only country I could find with higher electricity rates was Tonga.
Friday, May 18, 2012
Background for Grenada's Hotels Zero Carbon & Energy Liberalization Campaign
It's an ambition that is being pursued against the backdrop of a business community that has encountered more than its fair share of challenges in recent years. Eight years ago, over 90% of Grenada's homes and hotels (buildings of all types, really) were destroyed by Hurricane Ivan. Imagine a small island state where over 90% of the buildings have literally been stripped to their foundations! The reconstruction process did provide jobs for the local populace, but the owners and operators of the hotels lost a lot of money while their properties were out of business as they rebuilt.
Grenadian business people are resilient, and despite their losses, many used the devastation as an opportunity to upgrade their properties, including environmental retrofits (which will be profiled on this blog later). But then, just as the hotels climbed out of rebuilding after the hurricane, the global economic recession hit and pummelled tourism and Grenada's economy. In 2009 Grenada economy contracted by nearly 8% and it hasn't grown above 1.4% since.
Seems like an usual time for hotels to be worrying about the environment doesn't it?
Well according to the President of the Board of Directors for Grenada's Hotel and Tourism Association (GHTA), Grenada's hotels endure more than hurricanes and recessions - they also endure the world's highest energy prices (Grenada being among the top ten). Renewable energy provides the opportunity to reduce those costs, as well as to revitalize the nation's tourism sector as it responds to the growing environmental conscience of their customers.
So, with the help of Ethical Ideas, the GHTA is pursing a zero carbon future and energy liberalization. We have a lot of supporters already and I am very confident we will achieve the goal. Watch this space as I post updates on what we're doing and how we're progressing!
Grenadian business people are resilient, and despite their losses, many used the devastation as an opportunity to upgrade their properties, including environmental retrofits (which will be profiled on this blog later). But then, just as the hotels climbed out of rebuilding after the hurricane, the global economic recession hit and pummelled tourism and Grenada's economy. In 2009 Grenada economy contracted by nearly 8% and it hasn't grown above 1.4% since.
Seems like an usual time for hotels to be worrying about the environment doesn't it?
Well according to the President of the Board of Directors for Grenada's Hotel and Tourism Association (GHTA), Grenada's hotels endure more than hurricanes and recessions - they also endure the world's highest energy prices (Grenada being among the top ten). Renewable energy provides the opportunity to reduce those costs, as well as to revitalize the nation's tourism sector as it responds to the growing environmental conscience of their customers.
So, with the help of Ethical Ideas, the GHTA is pursing a zero carbon future and energy liberalization. We have a lot of supporters already and I am very confident we will achieve the goal. Watch this space as I post updates on what we're doing and how we're progressing!
Monday, May 7, 2012
Zero Carbon Future for Grenada Hotels
April 27, 2012-
Grenada Hotels Declare Energy Ambitions
St. George’s, Grenada – Russ Fielden, President of the Grenada Hotel and Tourism Association (GHTA) announced at the Sustainable Development Council meeting today that the business association will be pursuing a Carbon Free future and energy cost reductions for the sector. The Sustainable Development Council met to discuss Grenada’s prospects in the global Carbon Trading Market. The GHTA ambitions, dubbed by the GHTA as the ‘2012 Earth Day Declaration’ include a desire for Grenada Hotels:
- To be the first zero carbon hotel sector in the Caribbean, if not the world.
- Safeguard Grenada’s global competitiveness through an immediate cost reprieve on electricity prices until renewable conversion takes place
- To support the development of the Eastern Caribbean Electricity Regulatory Agency (ECERA) by OECS Governments and the World Bank
According to Mr. Fielden, Grenada’s electricity prices are among the highest in the world and this is making Grenada’s business environment very uncompetitive in an already limping global economy. As the GHTA sees it, failing to realize a cost reduction in electricity prices will spell disaster for Grenada’s already foundering economy. Renewable energy is one of the most cost-effective ways of reducing energy costs.
The business association has come out strongly in support of liberalizing Grenada’s energy sector and for having an energy infrastructure that is 100% carbon free. This is because Grenada’s current electricity pricing means that a hotel must, by law, sell 100% of the energy their solar systems might produce and then GRENLEC will sell it back to them at nearly three times the cost. The GHTA acknowledges that GRENLEC clearly cannot manage an electrical grid if too many people are operating different electricity producing systems that feed into the grid, but the Association is confident and determined to see a hotel sector that is carbon free.
The GHTA’s has retained Ethical Ideas Consulting Services to negotiate on their behalf to obtain grants, concessional loans, and negotiate agreements with other stakeholders. You can contact Jennifer Alexis through the GHTA office at 444-1353 or by emailing Jennifer Alexis at ethical.ideas@gmail.com
Wednesday, February 9, 2011
GRENADA’S YACHTING SECTOR RECEIVES MARKETING GRANT
St. George’s, January 31, 2011 - The Marine and Yachting Association of Grenada, also known as MAYAG, has received grant funds valued at approximately $70,000 Eastern Caribbean Dollars from the Centre for the Development of Enterprise (also known as the ‘CDE’) to support a marketing project aimed at promoting the growth of the sector. The funds will provide an opportunity for the Grenada’s yachting sector to identify new markets, develop a marketing plan to reach those markets as well as creating marketing materials and publishing the next edition of Grenada’s Marine Guide.
The marketing project will focus on branding Grenada globally as the ultimate yachting destination. “This grant provides an opportunity for Grenada’s yachting sector to increase its presence in the global marketplace” said MAYAG President, Anita Sutton. “Most of MAYAG’s Members are small and medium size enterprises, and the costs of advertising in the global marketing place are very high. By pooling our resources and effectively promoting Grenada as the ultimate yachting destination we will stretch our advertising dollars much further”. This project is very important for Grenada, as MAYAG estimates that the sector already contributes approximately $70 million XCD to Grenada’s economy per year, providing over 400 direct jobs and supporting at least 300 more jobs in the service industry and restaurants that make money from yachting visitors.
Consultants working on the project include the lead marketing expert Russell Jarman Price who resides in St. Patrick’s Grenada. While living in the UK, Mr. Jarman Price co-founded ‘Still Price Court’, one of the fastest growing advertising agencies ever with clients such as Coca-Cola and Virgin Atlantic. Three Grenadians will also make up the project team: Tony McQuilkin, a publisher and photojournalist, and Rosetta Weston, a business process re-engineering consultant and Jennifer Ellard-Alexis, a sustainable development specialist who is MAYAG’s proposal writer & project coordinator. For more information, email mayag@spiceisle.com or visit www.cde.int or www.mayag.net
The marketing project will focus on branding Grenada globally as the ultimate yachting destination. “This grant provides an opportunity for Grenada’s yachting sector to increase its presence in the global marketplace” said MAYAG President, Anita Sutton. “Most of MAYAG’s Members are small and medium size enterprises, and the costs of advertising in the global marketing place are very high. By pooling our resources and effectively promoting Grenada as the ultimate yachting destination we will stretch our advertising dollars much further”. This project is very important for Grenada, as MAYAG estimates that the sector already contributes approximately $70 million XCD to Grenada’s economy per year, providing over 400 direct jobs and supporting at least 300 more jobs in the service industry and restaurants that make money from yachting visitors.
Consultants working on the project include the lead marketing expert Russell Jarman Price who resides in St. Patrick’s Grenada. While living in the UK, Mr. Jarman Price co-founded ‘Still Price Court’, one of the fastest growing advertising agencies ever with clients such as Coca-Cola and Virgin Atlantic. Three Grenadians will also make up the project team: Tony McQuilkin, a publisher and photojournalist, and Rosetta Weston, a business process re-engineering consultant and Jennifer Ellard-Alexis, a sustainable development specialist who is MAYAG’s proposal writer & project coordinator. For more information, email mayag@spiceisle.com or visit www.cde.int or www.mayag.net
EMERGENCY YACHTLINE LAUNCHED AS GRENADA’S YACHT CRIME DECLINES
Jennifer Ellard-Alexis, St. Georges, January, 2010 – The Marine and Yachting Association of Grenada (MAYAG) has teamed up with the Royal Grenada Police Force(RGPF) for the second year in a row to preserve the safety and security enjoyed by cruisers visting Grenada.
According to visitor survey’s conducted by the Marine and Yachting Association, yachting visitors ranked ‘safety and security’ as a number one consideration when deciding where to visit and where to sail. Naturally, this means that Grenada’s safety record is important to the sector. Grenada recognizes the importance of safety and security to yachts andenjoys a reputation for being a relatively safe destination. MAYAG is actively working to ensure it stays that way. “We recognize that as there is a very small percentage of Grenadians engaged in criminal activity, there is a correspondingly small proportion of yachting visitors who are involved in illegal activities, and we welcome this partnership with the RGPF in keeping this place a haven for yachts “ MAYAG Chairperson Anita Sutton said at the January 21st launch of the emergency yachtline.
While explaining why the Royal Grenada Police Force had created a dedicated hotline for yachts, Supt. James, Commander of Grenada’s Drug Squad expressed how happy he was that the drug squad is partnering with MAYAG and the wider yachting community. He reported that the Region is threatened by the drug trade, and “society is the victim of the [drug] trade”; making it clear that Grenada had no intention of becoming one of those victims. Supt. James made it clear that the yachtline is for reporting security problems and energencies; however he also encouraged yachting visitors to use the yachtline to report any suspicious activity they see taking place – and that may include drug trafficking.
To launch what MAYAG calls the ‘emergency yachtline’; MAYAG brought together RGPF Commanders from the Drug Squad, the Criminal Investigations Department and the Coast Guard to meet with yachting interests in Grenada. The launch is the second meeting of it’s kind organized by MAYAG. The first security meeting held in March 2010 was such a success, it is likely to become an annual event. “Cruisers reported a need for improved police communications and emergency response in our 2010 security meeting”, MAYAG’s Vice Chair, Mr. Pascall said. The yachtline will address a great deal of that, but the yachtline is not the only measure MAYAG, cruisers, and the police are working on together. The community is working on raising funds to provide the Coast Guard with a number of the hardware assets required to improve their ability to keep Grenada safe, as well as seeing for better border security with the implmentation of eSeaClear.
Coast Guard Commander, Supt. Griffith who was recently posted as the new Commander of the Grenada Coast Guard, made it clear that cooperation between the police, yachting businesses and cruisers was essential for preventing the rise of crime. He also re-iterated the high level of regional cooperation which yachting visitors may not always be aware of. He cited cases of successful partnership with the Coastguard of Trinidad and Tobago, and mentioned some of the practical support available to the Grenada Coastguard regionally.
Grenada’s CID reports that maritime crimes have gone down from 10 incidents in 2009 to 9 incidents in 2010. Grenada’s 24/7 Emergency Yachtline is 473-405-7490.
According to visitor survey’s conducted by the Marine and Yachting Association, yachting visitors ranked ‘safety and security’ as a number one consideration when deciding where to visit and where to sail. Naturally, this means that Grenada’s safety record is important to the sector. Grenada recognizes the importance of safety and security to yachts andenjoys a reputation for being a relatively safe destination. MAYAG is actively working to ensure it stays that way. “We recognize that as there is a very small percentage of Grenadians engaged in criminal activity, there is a correspondingly small proportion of yachting visitors who are involved in illegal activities, and we welcome this partnership with the RGPF in keeping this place a haven for yachts “ MAYAG Chairperson Anita Sutton said at the January 21st launch of the emergency yachtline.
While explaining why the Royal Grenada Police Force had created a dedicated hotline for yachts, Supt. James, Commander of Grenada’s Drug Squad expressed how happy he was that the drug squad is partnering with MAYAG and the wider yachting community. He reported that the Region is threatened by the drug trade, and “society is the victim of the [drug] trade”; making it clear that Grenada had no intention of becoming one of those victims. Supt. James made it clear that the yachtline is for reporting security problems and energencies; however he also encouraged yachting visitors to use the yachtline to report any suspicious activity they see taking place – and that may include drug trafficking.
To launch what MAYAG calls the ‘emergency yachtline’; MAYAG brought together RGPF Commanders from the Drug Squad, the Criminal Investigations Department and the Coast Guard to meet with yachting interests in Grenada. The launch is the second meeting of it’s kind organized by MAYAG. The first security meeting held in March 2010 was such a success, it is likely to become an annual event. “Cruisers reported a need for improved police communications and emergency response in our 2010 security meeting”, MAYAG’s Vice Chair, Mr. Pascall said. The yachtline will address a great deal of that, but the yachtline is not the only measure MAYAG, cruisers, and the police are working on together. The community is working on raising funds to provide the Coast Guard with a number of the hardware assets required to improve their ability to keep Grenada safe, as well as seeing for better border security with the implmentation of eSeaClear.
Coast Guard Commander, Supt. Griffith who was recently posted as the new Commander of the Grenada Coast Guard, made it clear that cooperation between the police, yachting businesses and cruisers was essential for preventing the rise of crime. He also re-iterated the high level of regional cooperation which yachting visitors may not always be aware of. He cited cases of successful partnership with the Coastguard of Trinidad and Tobago, and mentioned some of the practical support available to the Grenada Coastguard regionally.
Grenada’s CID reports that maritime crimes have gone down from 10 incidents in 2009 to 9 incidents in 2010. Grenada’s 24/7 Emergency Yachtline is 473-405-7490.
Tuesday, December 15, 2009
George Soros Proposes an Interesting Green Fund
Famous Capitalist, George Soros has put forward an intriguing and practical idea for finding money that would support Green Financing and stimulate Carbon Markets. I think that his proposal is a good one. When I was the Advisor to the Prime Minister of Grenada, I had hoped Grenada could develop a Carbon Off-set programme.
The difficulty I encountered in it was a lot of negative feedback; from people more specialized in the area than I was. They told me it was near impossible to obtain green financing using this mechanism and when I looked for examples of successful project I found their observations about scale to bear truth.
The problem, they cited, was that the financing criteria was on such a large scale, a small island like Grenada could never develop a project large enough to become a viable carbon-offset programme. Either way, despite my enthusiasm to set up something like this, my workload was so heavy and resources so lean, I put the idea behind the pursuit of funding for other projects that had a more immediate promise of returns.
So if the UN take the advice of George Soros (He presented the statement below to the UN), I hope that the delegates are working equally hard to ensure that whatever money is raised for green financing is placed within a bureaucratic mechanism that ensures that: a) All nations will have equal access, and b) that buraucratic demands are not so extreme that technocrats find themselves unable to develop viable projects with their line Ministries.
This is a copy of the idea put forward by George Soros:
SDRs and Climate Change
It is now generally agreed that the developed countries will have to make a substantial contribution to enable the developing world to deal with climate change. There is no similar agreement on where the money will come from.
The developed countries are reluctant to make additional financial commitments. They have just experienced a significant jump in their national debts and they still need to stimulate their domestic economies. This colors their attitudes. It looks like they will be able to cobble together a "fast-start" fund of $10 billion a year for the next few years but more does not fit into their national budgets.
This is unlikely to satisfy the developing countries.
I believe this amount could be at least doubled and assured for over a longer time span.
Developed countries' governments are laboring under the misapprehension that funding has to come from their national budgets but that is not the case. They have it already. It is lying idle in their reserves accounts and in the vaults of the International Monetary Fund (IMF), available without adding to the national deficits of any one country. All they need to do is to tap into it.
In September 2009, the IMF distributed to its members $283 billion worth of SDRs, or Special Drawing Rights. SDRs are an arcane financial instrument but essentially they constitute additional foreign exchange. They can be used only by converting them into one of four currencies, at which point they begin to carry interest at the combined treasury bill rate of those currencies. At present the interest rate is less than one half of one percent. Of the $283 billion, more than $150 billion went to the 15 largest developed economies. These SDRs will sit largely untouched in the reserve accounts of these countries, which don't really need any additional reserves.
I propose that the developed countries--in addition to establishing a fast start fund of $10 billion a year--should band together and lend $100 billion dollars worth of these SDRs for 25 years to a special green fund serving the developing world. The fund would jump-start forestry, land-use, and agricultural projects. These are the areas that offer the greatest scope for reducing carbon emissions and could produce substantial returns from carbon markets. The returns such projects can generate go beyond reducing carbon; there will be non-carbon related returns from land use projects, the potential to create more sustainable rural livelihoods, enable higher and more resilient agriculture yields and create rural employment.
This is a simple and practical idea. There is a precedent for it. The United Kingdom and France each recently lent $2 billion worth of SDRs to a special fund at the IMF to support concessionary lending to the poorest countries. At that point the IMF assumed responsibility for the principal and interest on the SDRs. The same could be done in this case.
I further propose that member countries agree to use the IMF's gold reserves to guarantee the payment of the interest and the repayment of the principal. The IMF owns a lot of gold, more than a hundred million ounces, and it is on the books at historical cost. At current market prices it is worth more than $100 billion over its book value. It has already been designated to be used for the benefit of the least developed countries. The proposed green fund would meet this requirement.
This means that the developed countries that lend the SDRs would incur no interest expense and no responsibility for repayment. There are some serious technical problems involved in offsetting the interest income against the interest expense, particularly in the United States, but the net effect would be a wash. These technical difficulties stood in the way of previous attempts to put the SDRs to practical use but they do not apply to the the proposed green fund.
There are three powerful arguments in favor of this proposal:
First: the green fund could be self financing or even profitable. Potentially none or very little of the IMF gold would be actually used. Second: the projects will earn a return only if developed countries cooperate in setting up the right type of carbon markets. Setting up a green fund would be an implicit pledge to do so by putting the gold reserves of the IMF at risk. Third, this money would be available now, jump-starting carbon saving projects. For all these reasons, the developing countries ought to embrace my proposal.
The key point I want to make is that it is possible to substantially increase the amount available to fight global warming in the developing world by using the existing allocations of SDR--and the gold reserves of the IMF are more than sufficient to pay the interest on them. All that is lacking is the political will. The mere fact that it requires Congressional approval in the United States ensures that nothing will happen unless there is public pressure and pressure from the developing countries to make it happen. Yet it could make the difference between success and failure in Copenhagen.
George Soros
© 2009 GeorgeSoros.com | All rights reserved | Unsubscribe | Privacy Policy
The difficulty I encountered in it was a lot of negative feedback; from people more specialized in the area than I was. They told me it was near impossible to obtain green financing using this mechanism and when I looked for examples of successful project I found their observations about scale to bear truth.
The problem, they cited, was that the financing criteria was on such a large scale, a small island like Grenada could never develop a project large enough to become a viable carbon-offset programme. Either way, despite my enthusiasm to set up something like this, my workload was so heavy and resources so lean, I put the idea behind the pursuit of funding for other projects that had a more immediate promise of returns.
So if the UN take the advice of George Soros (He presented the statement below to the UN), I hope that the delegates are working equally hard to ensure that whatever money is raised for green financing is placed within a bureaucratic mechanism that ensures that: a) All nations will have equal access, and b) that buraucratic demands are not so extreme that technocrats find themselves unable to develop viable projects with their line Ministries.
This is a copy of the idea put forward by George Soros:
SDRs and Climate Change
It is now generally agreed that the developed countries will have to make a substantial contribution to enable the developing world to deal with climate change. There is no similar agreement on where the money will come from.
The developed countries are reluctant to make additional financial commitments. They have just experienced a significant jump in their national debts and they still need to stimulate their domestic economies. This colors their attitudes. It looks like they will be able to cobble together a "fast-start" fund of $10 billion a year for the next few years but more does not fit into their national budgets.
This is unlikely to satisfy the developing countries.
I believe this amount could be at least doubled and assured for over a longer time span.
Developed countries' governments are laboring under the misapprehension that funding has to come from their national budgets but that is not the case. They have it already. It is lying idle in their reserves accounts and in the vaults of the International Monetary Fund (IMF), available without adding to the national deficits of any one country. All they need to do is to tap into it.
In September 2009, the IMF distributed to its members $283 billion worth of SDRs, or Special Drawing Rights. SDRs are an arcane financial instrument but essentially they constitute additional foreign exchange. They can be used only by converting them into one of four currencies, at which point they begin to carry interest at the combined treasury bill rate of those currencies. At present the interest rate is less than one half of one percent. Of the $283 billion, more than $150 billion went to the 15 largest developed economies. These SDRs will sit largely untouched in the reserve accounts of these countries, which don't really need any additional reserves.
I propose that the developed countries--in addition to establishing a fast start fund of $10 billion a year--should band together and lend $100 billion dollars worth of these SDRs for 25 years to a special green fund serving the developing world. The fund would jump-start forestry, land-use, and agricultural projects. These are the areas that offer the greatest scope for reducing carbon emissions and could produce substantial returns from carbon markets. The returns such projects can generate go beyond reducing carbon; there will be non-carbon related returns from land use projects, the potential to create more sustainable rural livelihoods, enable higher and more resilient agriculture yields and create rural employment.
This is a simple and practical idea. There is a precedent for it. The United Kingdom and France each recently lent $2 billion worth of SDRs to a special fund at the IMF to support concessionary lending to the poorest countries. At that point the IMF assumed responsibility for the principal and interest on the SDRs. The same could be done in this case.
I further propose that member countries agree to use the IMF's gold reserves to guarantee the payment of the interest and the repayment of the principal. The IMF owns a lot of gold, more than a hundred million ounces, and it is on the books at historical cost. At current market prices it is worth more than $100 billion over its book value. It has already been designated to be used for the benefit of the least developed countries. The proposed green fund would meet this requirement.
This means that the developed countries that lend the SDRs would incur no interest expense and no responsibility for repayment. There are some serious technical problems involved in offsetting the interest income against the interest expense, particularly in the United States, but the net effect would be a wash. These technical difficulties stood in the way of previous attempts to put the SDRs to practical use but they do not apply to the the proposed green fund.
There are three powerful arguments in favor of this proposal:
First: the green fund could be self financing or even profitable. Potentially none or very little of the IMF gold would be actually used. Second: the projects will earn a return only if developed countries cooperate in setting up the right type of carbon markets. Setting up a green fund would be an implicit pledge to do so by putting the gold reserves of the IMF at risk. Third, this money would be available now, jump-starting carbon saving projects. For all these reasons, the developing countries ought to embrace my proposal.
The key point I want to make is that it is possible to substantially increase the amount available to fight global warming in the developing world by using the existing allocations of SDR--and the gold reserves of the IMF are more than sufficient to pay the interest on them. All that is lacking is the political will. The mere fact that it requires Congressional approval in the United States ensures that nothing will happen unless there is public pressure and pressure from the developing countries to make it happen. Yet it could make the difference between success and failure in Copenhagen.
George Soros
© 2009 GeorgeSoros.com | All rights reserved | Unsubscribe | Privacy Policy
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