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UK diplomat says financial crisis is a climat -

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UK diplomat says financial crisis is a climate change opportunity

The World Today - Thursday, 30 October , 2008 12:18:00

ELEANOR HALL: The Federal Opposition might be calling it crazy for the Government to press ahead
with its carbon trading plans but Britain's high commissioner says the world's political leaders
should see the global economic crisis as an opportunity rather than an obstacle to taking action on
climate change.

High Commissioner Helen Liddell, who was Britain's Energy Minster between 1999 and 2001, says the
financial turmoil could become a circuit-breaker ushering in a new low carbon industrial

Along with the Federal Climate Change Minster, the high commissioner is attending the Carbon
Markets Conference on the Gold Coast and she spoke to me from there earlier today.

High Commissioner, thanks for joining us.

The Australian Treasury is releasing its modelling of the economic impact of an emissions trading
scheme today but the Federal Opposition is already urging the Government to delay the introduction
of the scheme because of the global financial crisis. What is your reaction to this suggestion of a

HELEN LIDDLE: Well, frankly that is a matter for the politicians in Australia but the point of view
of the British Government is that we need to get underway as quickly as possible with addressing
the issues of reducing our carbon emissions and emissions trading is one way to do that.

Businesses are crying out for certainty. What's going to happen? What is the carbon price going to
be? How do we plan for the future?

ELEANOR HALL: But if we are talking about certainty in planning for the future, the argument about
delaying the scheme is that the Treasury modelling out today doesn't take account of the global
financial crisis and is therefore out of date. Won't the crisis change modelling for all countries
quite significantly and isn't it reasonable to delay things until that can be done properly?

HELEN LIDDLE: Well, it is not for me to enter into the debate about delay but what I will say is
the present financial turmoil will pass. We have been through this before. Perhaps in not such a
dramatic way but we have been through it before.

The issues of climate change are with us for centuries into the future and really the prize will
lie with those who take leadership.

You know, 10 years ago in Britain we set up our own emissions trading scheme - the first in the
world. And at that time everybody said, oh dear, this is far too risky.

Within five years we had more than doubled the amount of carbon that was being saved in Britain and
as a consequence of that, Britain now leads the world as a financial trading market in carbon

ELEANOR HALL: You were Britain's Energy Minister, how hard was it politically to drive the sort of
cuts that Britain is now committed to which I think are an 80 per cent reduction in emissions by

HELEN LIDDLE: Yeah, at the beginning it was pretty, pretty hairy. The business community shouted
rather loudly but frankly we hear very little about that now because it has actually led to their
increased efficiency because they'd recognised that energy is an expensive commodity.

ELEANOR HALL: And yet the suggestion is that Australia should only commit to a 10 per cent
reduction in emissions by 2020 if the rest of the world fails to reach a strong agreement at
Copenhagen. What are the risks do you think that the global financial crisis will push climate
change down the agenda for the world's leaders?

HELEN LIDDLE: I think there are some naysayers who would quite welcome trying to put climate change
onto the back burner. They tend to like the world as it is rather than the world that we would all
like it to become.

But Australia is working closely with the rest of the developed world and the developing world in
the run-up to Copenhagen and are a very, very valuable partners of those of us who want to keep the
world united and see a real deal coming out of Copenhagen.

There is a staging post in the next few weeks at Poznan in Poland where we will get a true measure
of the situation and of course, by then, we will have a handle on what the next US administration
is likely to be.

ELEANOR HALL: You say that the naysayers will be using the financial crisis to push the climate
change issue down the agenda. Do you not see that, particularly in the United States where the cost
of the crisis is so high, that there could be legitimate arguments for pushing it down the agenda?

HELEN LIDDLE: Well I think the United States, I think both sides of the presidential debate at the
moment, recognise that the United States can no longer ignore the challenge of climate change and
indeed there will be changes in the whole industrial make-up of the United States and indeed most
countries as a consequence of the financial turmoil that we have gone through.

We can either see this as an opportunity to stick our heads in the sand and hope that the turmoil
goes away, that climate change goes away or we can say here is the chance for a new industrial
revolution. Here is a chance to regenerate our economies in a more carbon neutral way and the
companies that seize the opportunity have great benefits to them.

Our Carbon Trust in the United Kingdom has been doing a lot of work on the business outcomes that
are likely to be for businesses and businesses that get ahead of the game are likely to reap
benefits of 80 per cent and more.

ELEANOR HALL: You almost seem to be suggesting that the financial crisis could indeed be a catalyst
for driving countries towards more carbon-efficient economies?

HELEN LIDDLE: I believe it could be. I believe the regeneration programs that we are going to see
coming out of countries because everybody has concentrated on the turmoil over the past few weeks.
Understandably, the scale of it has been massive.

If somebody had said a month ago that we would see governments re-capitalising banks and in some
cases, overtaking banks, people would have thought we were mad but that is what is happening but
now we need to turn to what comes next.

How do we regenerate our economies? How do we protect the most vulnerable from the challenges of
global downturn and that means looking at reinvestment, looking at infrastructure, looking at new
ways forward.

And I also believe that, as I said at a conference the other day, that this can be a catalyst for
getting settlement to the Doha Round. It can be the means of being the circuit breaker, making
people wake up and decide whether they want to take a step forward into the abyss or if they want
to take a step back and look to the future.

And if we keep sucking our teeth and saying oh dear the world is in a terrible state, we will be
paralysed. The worst thing that can happen to us now is drift. What we need now is leadership.

ELEANOR HALL: High Commissioner, thanks very much for joining us.

HELEN LIDDLE: You are very welcome, thank you.

ELEANOR HALL: And that is Britain's high commissioner to Australia, Helen Liddle who was speaking
to me earlier from the Gold Coast.