Copenhagen Climate Treaty & Climategate

China and India Endorse Copenhagen Climate Deal

March 9, 2010

Reuters - China and India joined almost all other major greenhouse gas emitters Tuesday in signing up to the climate accord struck in Copenhagen, boosting a deal strongly favored by the United States.

More than 100 nations have now endorsed the Copenhagen Accord, a non-binding agreement reached after two weeks of tortuous wrangling at a 194-nation summit in December.

The accord plans $100 billion a year in climate aid for developing nations from 2020 and seeks to limit global warming to below 2 degrees Celsius (3.6F) above pre-industrial times, but produced no timetable of emission limits to reach that goal.

Indian Environment Minister Jairam Ramesh told parliament that India would also let its name join the list of "associated" countries on the three-page document.

"This will strengthen our negotiating position on climate change," Ramesh said.

Chinese negotiator Su Wei wrote a one-sentence letter to the U.N. Climate Change Secretariat in Bonn saying that it could "proceed to include China in the list."

China, the United States, the European Union, Russia and India are the main emitters of the greenhouse gases that are blamed for global warming -- mostly carbon dioxide from burning fossil fuels. Only Russia has yet to associate with the deal.

The endorsements are a small boost for the Accord, which environmentalists say was a bare-minimum outcome from a summit that many nations hoped would end with a broad, legally binding pact to fight climate change.

But they offer little indication of how, or when, rich and poor nations might agree on a binding mechanism for combating climate changes that scientists say will multiply droughts, floods, storms and heatwaves, and dramatically raise sea levels.

China and India have preferred since Copenhagen to stress the supremacy of the 1992 U.N. Climate Convention, agreed in Kyoto, which puts the emphasis on rich nations cutting emissions.

Ramesh reiterated that India's support for Copenhagen was lukewarm.

"The Accord is a political document. It is not a template for outcomes," he said, adding that it could not supplant years of U.N.-led talks meant to yield a new, binding treaty.

In contrast, the United States, which wants to bind the major developing economies such as China and India into commitments to limit emissions, has said that the Accord could guide talks on a new treaty.

It has urged "further formalization of the Accord" at the next major U.N. climate meeting at the end of 2010 in Mexico.

Progress on a new treaty has stalled, partly because the U.S. Senate has yet to decide whether to cap greenhouse gas emissions. President Barack Obama wants a cut of 17 percent from 2005 levels by 2020, or about 4 percent below 1990 levels.

Few countries want to commit to a costly shift to renewable energies unless Washington joins in. Skeptics are questioning the 2007 conclusions by a U.N. panel of scientists that blamed mankind for global warming after errors in the report.

At the end of the Copenhagen summit, the BASIC group of nations -- China, India, South Africa and Brazil -- joined the United States, the European Union and a small number of other countries in agreeing to the Accord.

But the text was only "noted" by the summit as a whole after objections from a few developing nations such as Sudan, Ecuador and Venezuela. In a compromise, it was decided nations wishing to "associate" with it would be listed at the top of the text.

JPMorgan Eyes Share of China "Green IPO" Rush

March 9, 2010

Reuters - U.S. bank JPMorgan will expand its 'new energy' team in China to win more business from what it sees as a trend to increasingly popular "green IPOs," its China chief said on Tuesday.

Fang Fang, JPMorgan's China CEO, predicts that more new energy and natural resource companies will go public as they seek to fund their rapid expansion, and there could be more consolidation among wind and solar power suppliers, creating a potentially lucrative advisory fee stream for bankers.

"This year, we see lots of opportunities in new energy, natural resources and construction material sectors," Fang said in an interview on the sidelines of the Chinese People's Political Consultative Conference (CPPCC).

"I think such 'green IPOs' will be the trend for the next few years and some industry consolidation may take place, too. Technology, property and consumer sectors remain active," said Fang, who is a delegate to the CPPCC, China's top political advisory body.

In December, China Longyuan Power Group Corp, the world's fifth-largest wind power generator, raised $2.2 billion via a Hong Kong listing, the biggest wind power IPO in 2009, and Xinjiang Goldwind Science & Technology Co, a wind power producer, plans to raise $1.5 billion this year via a Hong Kong IPO, Reuters reported in January.

Fang, who joined JPMorgan in 2001 and was appointed to his current post in 2007, said the bank placed "a very significant focus" on China and was looking to grow its business there on several fronts.

"We want to provide multiple lines of services, not just investment banking but also something like corporate banking, asset management, commodities and carbon trading," he said.

"We're building up our deal pipeline nicely, and I expect deal volume to increase from last year," he said.

Fang submitted a proposal to Beijing last week that China should set up a domestic carbon trading exchange.

China has pledged to cut the amount of carbon dioxide produced for each unit of economic growth by 40-45 percent by 2020, compared with 2005 levels.

Fang added the bank was looking also to establish a securities joint venture in China as soon as possible, joining other investment banks such as Goldman Sachs and UBS that have already set up China securities joint ventures in recent years.

Under Chinese rules, foreign institutions must team up with local partners to form investment banking joint ventures to underwrite shares and conduct other securities business in domestic capital markets.

"The securities venture will provide us a very good platform to expand into more and new business," said Fang. "For example, serving domestic investors and issuers and helping foreign investors and issuers access Chinese domestic capital markets."

In China, JPMorgan already has joint ventures in fund management and futures business. A securities venture would help it tap China's growing innovative financial business such as the landmark stock index futures scheme due for launch next month.

JPMorgan is also hiring at its locally incorporated bank in China, which provides commercial and corporate banking, and Fang said the bank would add more branches to the five it currently has in big Chinese cities.

"We see lots of growth opportunities in the traditional investment banking business and that still has a long way to go in China," he said.

"At the same time, we see big potential in many other areas. For example, our local incorporated bank can help us reach more domestic enterprises and provide them with trade finance, treasury management and other corporate banking services."