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Scrap fuel subsidies and price CO2, urges World Bank

Source: Reuters - Mon, 6 May 2013 15:30 GMT
Author: Reuters Point Carbon
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An activist walks past a banner of a giant 1 trillion dollar bill, representing the amount in taxpayer dollars spent yearly by governments on fossil fuel subsidies, in Los Cabos, June 18, 2012. REUTERS/Victor Ruiz Garcia
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LONDON, May 6 (Reuters Point Carbon) – The world’s nations must scrap fossil fuel subsidies and put a price on emitting carbon dioxide if the planet is to avoid dangerous climate change, according to the president of the World Bank.

The two measures are part of a five-point plan that the bank urged the world’s environment ministers to take, including building low carbon cities, improving agricultural practices and sharing new technology that will save energy.

“We need a global response equal to the scale of the climate problem. Bold action that will make the biggest difference,” Jim Yong Kim told about 30 of the world’s energy and environment ministers gathered in Berlin for informal talks on a new global climate deal to take effect in 2020.

Around 9 percent of the world’s population currently face some form of carbon price, but Kim urged more countries to roll out price mechanisms “whether this is through a tax on carbon, indirect taxation, regulation or the creation of a carbon market.”

Kim said that in addition, fossil fuel subsidies must be phased out if the world is to escape the worst effects of global warming, such as the devastating floods in Thailand in 2011 that cost the country $45 billion, about 13 percent of its GDP.

“They are regressive, negatively impact the environment and act as a barrier to progress on clean technology," he said.

The Berlin meeting comes a week after more than 600 officials and non-governmental campaigners gathered in Bonn to discuss a new global climate deal due to be signed in 2015 to succeed the current Kyoto Protocol.

Last week, negotiators from the United States urged nations to scrap coal, gas and oil subsidies by the end of the decade – a measure that it says could cut emissions 10 percent under business-as-usual levels by mid-century.

By Andrew Allan – andrew.allan@thomsonreuters.com

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