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Can Trade Tariffs Facilitate Environmental Repair?

Treasury Secretary Henry Paulson recently talked at the Clinton Global Initiative in New York. Paulson advocates the removal of any trade tariffs on environmentally sustainable technology. ‘It’s economically and morally indefensible to have tariffs on environmental goods and services,’ said Mr. Paulson. Paulson believes that the path to environmental health lies through developed countries working with developing countries to make sure technology development is sustainable. He mentioned that the US advises China on how to reduce sulphur dioxide emissions, the implementation of clean coal technology, and to develop sustainable logging.

Mr. Paulson goes one step further to suggest that the World Bank should finance emerging nations who want to develop energy and transportation infrastructures. One has to wonder what strings would be attached to World Bank financing? Perhaps some experts on finance would like to comment on this issue? Could it be possible that sustainable technologies could be financed on consignment, with a percentage of profits from the use of the technology paying off a loan over a number of years?

All of these remarks come at this juncture because the Bush Administration is holding talks on Global Warming in Washington DC. The White House wants to control the debate and to be the player that sets up the terms of repairing the environment. As one major nation that did not sign the Kyoto pact, the U.S. seems to be trying to force the other 175 nations that did sign the pact to do it the American way, and only that way. Because of this attitude, China and a few other nation’s ambassadors have said that they will attend the climate meetings in Washington but that they prefer to attend the United Nations Framework Convention on Climate Change that will be held later this year. Could it be that the rest of the world is irritated by a U.S. environmental policy standpoint that seems a little bit arrogant?