Free «Global Trading of Emissions Credits» Essay Sample

Global trading of emission credits refers to the ability of developed nations to purchase emission permits from the developing countries. A tradable permit system therefore allows any organization which emits greenhouse gases in the environment to own permits which are equal to the amount of greenhouse gases which it emits. For instance, an organization which emits two hundred tons of greenhouse gases will be required to have two hundred permits. The permits are normally allocated among nations through a treaty whereby each government in the nations will be charged with the responsibility of distributing the permits locally. After the permits are distributed, they could then be bought and sold on a world market without any restrictions (Great Britain, 2010).

In the contemporary world, it is a crime for one to burn fuel fossils without having bought a permit and therefore governments all over the world are tasked with enforcing the treaty in their own borders. The trend of purchasing of emission credits by developed countries from developing ones has created debates with critics arguing that the trade will worsen the degradation of the greenhouse gases and further pollute the environment. However, the purchase of emission credits will indeed reduce the level of environmental degradation because developed countries like for instance Canada and the United States of America have advanced technologies such as solar energy, wind energy, CDM, Green Building and solar energy which are well implemented in the commercial and non-commercial sectors with an aim of reducing greenhouse effects (Antes, 2008).



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In the recent past, there has been numerous development and growth of the commercial and industrial sectors of the economy in various countries all over the world which has therefore necessitated the need for a high amount of energy. The need for high consummation of energy by the industrial and commercial sectors therefore results in increased emissions of green house gases which in turn lead to degradation of the environment in the world. Debates have been elicited concerning the possibility or vitality of allowing the developed countries to buy emission credits from those countries that are developing. Even though some critics are against the idea of the tendency of the developed nations buying emission credits from the developing countries, this practice is significant and therefore beneficial to the economies of the developing countries (Carraro, 2007).

One of the most significant benefit that will accrue as the result of purchasing of emission credits by the developed countries from the developing nations is that efficient policies will be promoted in the third world countries. One of the facts that should not be disputed is that whether third world countries or developing nations sold their emission credits to the developed countries or not, they will still have industries emitting green house gases which will in turn cause pollution. The purchase of emission credit by developed countries is therefore a blessing in disguise for third world countries. It is therefore economical to allow developed countries to purchase emission credits from the developing countries because they have advanced technology which will ensure minimal emission of green house gases as compared to the developing countries. Developing countries will, if left to use their emission credits, increase the levels of gas emissions released to the environment and therefore leading to increased levels of pollution in the environment (Hillebrand, 2008).

Allowing the developed nations to buy emission credits from developing countries will lead to cost effectiveness since the developing countries will reduce their potential costs of production and as a result use the funds to develop other areas which may need urgent attention like for instance, building of social amenities and infrastructure. This will therefore lead to improved living standards for the citizens leaving in developing countries. The funds obtained from the developed world by the developing countries as a result of selling their emissions credits could as well be used in creation of employment which will in turn help to increase and improve the economy of these countries. Given the fact that the prices for the emissions are normally set a higher level, the developing countries can use the funds obtained from the developed countries to meet their development and social needs (House of Lords, 2008).

Fairness and equity will be enhanced between the developed countries and the developing nations because of the international trading welfare. The trade barrier that has challenged the trading welfare of the developed and developing countries is based on the fact that the developing world have not yet been categorized as industrialized countries and therefore, they are not licensed to carry out any of their de-carbonization economic tasks until they are adequately supplied wit technology and adequate funds aimed which can meet these needs. The developing countries will therefore be able to grow economically as they will be better placed to do business transactions on a global basis with other developed nations which have been allowed to buy emissions credits from them. The funds got by developing countries as a result of selling their emission credits to the developed countries will in turn be used to acquire advanced technologies which will enhance the fairness and equity between them (Great Britain, 2010).

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In addition, developed nations have comparatively low levels of unemployment rates and affluence levels as compared to their developing nations which have low levels per capita income, low levels of capital formation and less education levels and are therefore coupled with a lot of poverty which cannot enable them to invest in reduction of gas emissions within their borders. The developing nations are still suffering as a result of diseases, abject poverty, natural disasters and diseases. The developed countries on the other had have high Gross Domestic Product (GDP) per Capita and therefore they excellent roads and good technological improvements which translates into good health care, good education, steady governments and good health care systems. The developed countries are therefore in good position to purchase high technologies which can aid in reduction of the green house gases in the atmosphere.

The value of productive economic activity that is expressed the standards of living is the major difference between developing and developed countries. Developed countries have more modern advanced technologies which can be used by its people. The literacy Rate, Gross Domestic Product per Capita and the Life Expectancy between the developed and developing countries are different.

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On the other hand, critics opposing the purchase of emission transmission by the developed countries from developing countries may base their arguments on the fact that this will equate to giving the developed countries the right to go on and pollute because they have the power of money to buy the emission credits. They may also argue that the trading of emission credits between the developed and developing countries may hinder the efforts of the welfare community and the scientists to implement or institute projects which are aimed at minimizing further destruction of the environment as a result of the greenhouse effect which may be disastrous to the human population (Jens, 2008).

To counter the arguments of the critics against the emission credit trade, it can be argued that this trading system actually works positively in the reduction of environmental degradation arising from pollution of the environment. This can be attributed to the fact that the developed countries are more developed and well equipped with high tech machines and skilled personnel who operate efficiently to achieve minimal levels of pollution as opposed to the traditional means used by the developing nations who have known to lack efficient mechanisms or technologies aimed at reducing the levels of pollution in their commercial and industrial processes and operations.

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The critics of the emission purchase trade will not have efficient and viable systems that can be adopted and implemented with an aim of reducing green house gas emissions in the world if they were put to task to explain. They (critics) cannot therefore be in position to present practical and instrumental systems which can effectively yield to economic and social benefits coupled with equity and fairness between the developing and the developed countries. Based on the fact that both the developed and developing countries will go on emitting greenhouse gases in their industrial projects with or with no purchase of the emission credits, there is no harm in the trading of emission credits between these categories of countries (Jens, 2008).

It is quite moral for developed nations to assist the developing countries by buying emission credits from them while it will be quite immoral for both the developed and developing countries to continue emitting green house gases in the environment with no mutual benefit in between them. To maintain this morality, it is therefore vital for developed countries to be allowed to continue buying emission credits from the developing countries because the funds will be used to supplement other taxes for provision of essential services to its customers. This will in turn minimize costs which could have been incurred by the developing countries to purchase expensive technologies aimed at reducing green house emissions (Kim, 2009).

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The human population should therefore acknowledge the fact that this is an era of industrial growth where every country's objective is to increase its production levels in order to gain economic development. It is with this fact in mind that well established systems should be put in place to oversee the reduction of gases being emitted into the environment and create policies which will guide the way on how the developed countries should buy emission credits from their developing partners. The purchasing of emission credits by the developed countries from the developing nations is a viable business because it creates a mutual relationship between them while at the same time minimizing the levels of pollution.


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