UN Secretary-General Antonio Guterres on Tuesday urged wealthy nations to tax fossil fuel companies and use the proceeds to compensate for damage from climate change and provide relief over rising prices.
“Let’s tell it like it is – our world is addicted to fossil fuels. It’s time for an intervention. We need to hold fossil fuel companies and their enablers to account,” Guterres said in an address to open the UN General Assembly.
The industry is “feasting on hundreds of billions of dollars in subsidies and windfall profits while household budgets shrink and our planet burns”, Antonio Guterres told world leaders in New York.
Record profits enjoyed by fossil fuel firms at a time of high energy costs and a cost of living crisis have prompted calls in many countries for leaders to impose a one-off tax on the extra income.
Money raised should be used to help people struggling with rising food and energy bills, as well as to compensate countries suffering the most severe effects of climate change, the secretary-general told the United Nations General Assembly, which is expected to be dominated by discussions of Russia’s invasion of Ukraine.
Sparks fly over damage from climate change
In spite of demanding “polluters must pay”, Mr Guterres cannot mandate action from developed countries, many of which are grappling with extreme weather, high food and energy prices and the Ukraine war.
But Antony Froggatt, from international affairs think tank Chatham House, said the statement “is an important signal” and highlights the “unequal nature of the current crisis, with some countries, companies and citizens benefiting hugely”.
But Mr Guterres has previously urged an end to funding for more oil and gas exploration and production, “which has not stopped these taking place”, Mr Froggatt added.
The European Union plans to raise about €140bn (£121bn) by imposing windfall taxes on energy companies’ “abnormally high profits”, a move that could put pressure on Prime Minister Liz Truss to do more in the “mini budget” on Friday.
Ms Truss decided against extending the UK’s windfall tax for North Sea extractors – set at 25% but which can largely be avoided if companies reinvest the money in new extraction. Instead she has pledged to freeze energy bills at an average of £2,500 a year, which will be paid for by borrowing.
The UN chief told world leaders that nations are “gridlocked in colossal global dysfunction” and are not ready or willing to tackle the major challenges that threaten the future of humanity and the fate of the planet.
He warned of “cascading” climate, energy and cost of living crises that are “feeding on each other, compounding inequalities, creating devastating hardship, delaying the energy transition and threatening global financial meltdown”.
“Social unrest is inevitable – with conflict not far behind,” he said.
Mr Froggatt said that “adapting to and preparing for further environment and resource shocks will be a, if not the challenge”, in future.
Mr Guterres also said that it was time to hold to account fossil fuel companies “and their enablers”, including financial and PR firms that are “raking in billions to shield the fossil fuel industry from scrutiny”.
“Fossil fuel interests need to spend less time averting a PR disaster and more time averting a planetary one,” Mr Guterres said.
Scientists agree that pollution must be reduced by 45% by 2030 to have any hope of reaching net zero by 2050, and stave off the worst of climate breakdown. But emissions, which mostly come from burning oil, gas and coal, are on course to rise by 16% by 2030, compared with 2010 levels.
Ipek Gençsü, from global affairs think tank ODI, said windfall taxes are unpopular with fossil fuel companies as well as from some economic perspectives, which argue they disincentivise private investment by “changing the rules of the game”.
But we cannot have conversations about windfall taxes “without understanding the bigger picture, and the fact that fossil fuel companies and fossil fuel emissions are the biggest contributor to the climate crisis,” she said.
(With input from Agencies)
#UN #UnitedNations #Dcoglobalnews
Published By Odoh Dominic Chukwuemeka
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