SUMMARY OF THE PANAMA CITY CLIMATE CHANGE TALKS, 1-7 OCTOBER 2011

A BRIEF HISTORY OF THE UNFCCC AND THE KYOTO PROTOCOL

The international political response to climate change began with the adoption of the United Nations Framework Convention on Climate Change (UNFCCC) in 1992, which sets out a framework for action aimed at stabilizing atmospheric concentrations of greenhouse gases to avoid dangerous anthropogenic interference with the climate system. The UNFCCC entered into force on 21 March 1994 and now has 195 parties. In December 1997, delegates to the third session of the Conference of the Parties (COP) in Kyoto, Japan, agreed to a Protocol to the UNFCCC that commits industrialized countries and countries in transition to a market economy to achieve emission reduction targets. These countries, known as Annex I parties under the UNFCCC, agreed to reduce their overall emissions of six greenhouse gases by an average of 5.2% below 1990 levels between 2008-2012 (the first commitment period), with specific targets varying from country to country. The Kyoto Protocol entered into force on 16 February 2005 and now has 193 parties. At the end of 2005, the first steps were taken to consider long-term issues. Convening in Montreal, Canada, the first session of the Conference of the Parties serving as the meeting of the Parties to the Kyoto Protocol (COP/MOP 1) decided to establish the Ad Hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol (AWG-KP) on the basis of Protocol Article 3.9, which mandates consideration of Annex I parties further commitments at least seven years before the end of the first commitment period. COP 11 agreed to consider long-term cooperation under the Convention through a series of four workshops known as the Convention Dialogue, which continued until COP 13.

BALI ROADMAP:

COP 13 and COP/MOP 3 took place in December 2007 in Bali, Indonesia. Negotiations resulted in the adoption of the Bali Action Plan. Parties established the Ad Hoc Working Group on Long-term Cooperative Action under the Convention (AWG-LCA) with a mandate to focus on key elements of long-term cooperation identified during the Convention Dialogue: mitigation, adaptation, finance, technology and a shared vision for long-term cooperative action. The Bali conference also resulted in agreement on the Bali Roadmap, based on two negotiating tracks under the Convention and the Protocol, and set a deadline for concluding the negotiations at COP 15 and COP/MOP 5 in Copenhagen in December 2009.

COPENHAGEN CLIMATE CHANGE CONFERENCE:

The UN Climate Change Conference in Copenhagen, Denmark, took place from 7-19 December 2009, and included COP 15 and COP/MOP 5, the 31st sessions of the Subsidiary Body for Implementation (SBI) and the Subsidiary Body for Scientific and Technology Advice (SBSTA), as well as AWG-KP 10 and AWG-LCA 8. Over 110 world leaders attended the joint COP and COP/MOP high-level segment from 16-18 December. The conference was marked by disputes over transparency and process. During the high-level segment, informal negotiations took place in a group consisting of major economies and representatives of regional and other negotiating groups. Late in the evening of 18 December, these talks resulted in a political agreement: the Copenhagen Accord, which was then presented to the COP plenary for adoption. Over the next 13 hours, delegates debated the Accord. Many supported adopting it as a step towards securing a better future agreement. However, some developing countries opposed the Accord, which they felt had been reached through an untransparent and undemocratic negotiating process. Ultimately, the COP agreed to take note of the Copenhagen Accord. It established a process for parties to indicate their support for the Accord and, during 2010, over 140 countries did so. More than 80 countries also provided information on their national emission reduction targets and other mitigation actions. On the last day of the Copenhagen Climate Change Conference, the COP and COP/MOP also agreed to extend the mandates of the AWG-LCA and AWG-KP, requesting them to present their respective outcomes to COP 16 and COP/MOP 6.

CANCUN CLIMATE CHANGE CONFERENCE:

Following four preparatory meetings in 2010, the UN Climate Change Conference in Cancun, Mexico, took place from 29 November to 11 December 2010. By the end of the conference, parties finalized the Cancun Agreements, which include decisions under both negotiating tracks. Under the Convention track, Decision 1/CP.16 recognized the need for deep cuts in global emissions to achieve the 2°C target. Parties also agreed to consider strengthening the global long-term goal during a review by 2015, including in relation to the 1.5°C target. They took note of emission reduction targets and nationally appropriate mitigation actions (NAMAs) communicated by developed and developing countries respectively (FCCC/SB/2011/INF.1/Rev.1 and FCCC/AWGLCA/2011/INF.1, both issued after Cancun), and agreed to discuss them during workshops in 2011. Decision 1/CP.16 also addressed other aspects of mitigation, such as measuring, reporting and verification (MRV); and reducing emissions from deforestation and forest degradation in developing countries; and the role of conservation, sustainable management of forests and enhancement of forest carbon stocks in developing countries (REDD+). Parties also agreed to establish several new institutions and processes. These included the Cancun Adaptation Framework and the Adaptation Committee, as well as the Technology Mechanism, which includes the Technology Executive Committee (TEC) and the Climate Technology Centre and Network (CTCN). On finance, Decision 1/CP.16 created the Green Climate Fund (GCF), which was designated as the new operating entity of the Convention s financial mechanism and is to be governed by a board of 24 members. Parties agreed to set up a Transitional Committee tasked with the Fund s detailed design, and established a Standing Committee to assist the COP with respect to the financial mechanism. They also recognized the commitment by developed countries to provide US$30 billion of fast-start finance in 2010-2012, and to jointly mobilize US$100 billion per year by 2020. Under the Protocol track, Decision 1/CMP.6 included agreement to complete the work of the AWG-KP and have the results adopted by the COP/MOP as soon as possible, and in time to ensure there will be no gap between the first and second commitment periods. The COP/MOP urged Annex I parties to raise the level of ambition of their emission reduction targets with a view to achieving aggregate emission reductions consistent with the range identified in the Fourth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC). Parties adopted Decision 2/CMP.6 on land use, land-use change and forestry (LULUCF). The mandates of the two AWGs were also extended until the next UN Climate Change Conference, in Durban, South Africa, to be held from 28 November to 9 December 2011.

UN CLIMATE CHANGE TALKS IN BANGKOK:

After Cancun, the two AWGs resumed their work in Bangkok from 3-8 April 2011. The AWG-LCA spent the Bangkok session engaged in procedural discussions on its agenda. Following a week of negotiations, agreement was reached on the agenda that formed the basis of work for the resumed AWG-LCA 14 in Bonn. Under the AWG-KP, parties focused on key policy issues hindering progress under the Protocol track.

UN CLIMATE CHANGE TALKS IN BONN:

The UN Climate Change Conference took place in Bonn, Germany, from 6-17 June 2011 and included the 34th sessions of the SBI and SBSTA, as well as the second parts of AWG-LCA 14 and AWG-KP 16. The SBSTA s closing plenary agreed to consider, at its next session, the proposed new item on impacts of climate change on water and integrated water resources management under the Nairobi Work Programme on impacts, vulnerability and adaptation. No agreement was reached on other proposed new items, such as blue carbon and rights of nature and the integrity of ecosystems, and a work programme on agriculture. Under the SBI, work was launched on national adaptation plans, and loss and damage, the consideration of which was mandated by the Cancun Agreements while the agenda item relating to MRV remained in abeyance. Proposed new items related to the impacts of the implementation of response measures also featured prominently in the agenda discussions. As a result, the SBI and SBSTA Chairs convened a forum on the impact of the implementation of response measures organized as a contact group. The focus of the AWG-KP was on outstanding political issues and conditionalities set by various Annex I countries for taking on new commitments during a second commitment period. Despite initial opposition from developing countries, parties also undertook technical work on issues, including LULUCF, the flexibility mechanisms and methodological issues. Progress made was captured in a revised proposal by the AWG-KP Chair (FCCC/KP/AWG/2011/CRP.1). Under the AWG-LCA, substantive work began, based on Decision 1/CP.16. Parties worked in a single contact group and informal groups on adaptation, finance, technology, capacity building, shared vision, review of the global long-term goal, legal options, and diverse issues related to mitigation. Parties agreed that notes prepared by the facilitators of the AWG-LCA informal groups be carried forward to the third part of AWG-LCA 14. While progress was made on some issues, many felt that the outcomes were relatively modest.

REPORT OF THE MEETING

Opening the session on Saturday, 1 October, UNFCCC Executive Secretary Christiana Figueres called on parties to bridge remaining differences in Panama to facilitate agreement in Durban. She highlighted progress on the design of the Green Climate Fund (GCF) and the Technology Executive Committee (TEC), but underscored the need for progress on monitoring, review and verification (MRV) and the Review. Figueres stressed that negotiations are working against the clock under the Kyoto Protocol and that Durban needs to address further commitments for developed countries under the Protocol; she called for the evolution of the mitigation framework under the Convention for developed and developing countries. Roberto Henríquez, Minister of Foreign Affairs, Panama, welcomed participants, observing that this meeting is a small but significant step in the path towards the global objective of addressing climate change. He underscored that COP 17 must result in the adoption of a second commitment period under the Kyoto Protocol and decisions to achieve the objectives of the Bali Action Plan (BAP).

AD HOC WORKING GROUP ON FURTHER COMMITMENTS FOR ANNEX I PARTIES UNDER THE KYOTO PROTOCOL

AWG-KP Chair Adrian Macey (New Zealand) opened the resumed session on Saturday, 1 October. He suggested resuming the five spin-off groups on: Annex I parties further commitments; land use, land-use change and forestry (LULUCF); the flexibility mechanisms; other issues; and potential consequences. He said informal consultations would be held on whether to convene a legal group. Parties agreed to the organization of work. Macey underscored the need to define the nature and content of rules for the second commitment period of the Kyoto Protocol, and its relationship with the AWG-LCA outcome. South Africa reported on informal consultations held in the run-up to Durban, emphasizing efforts to ensure transparency and inclusiveness. On key challenges for Durban, she underscored a decision on a second commitment period under the Kyoto Protocol that is linked to the legal status and form of the future climate change regime. She highlighted views expressed in consultations, including: a possible mandate for a process towards a comprehensive legally-binding agreement with agreed timeframes and milestones; a Review that could be a vehicle for progress towards a legally-binding agreement; and the need to build trust through clear MRV rules. Argentina, for the Group of 77 and China (G-77/China), expressed concern at the lack of progress under the AWG-KP, emphasizing that political will is key for establishing a second commitment period. He also called for overcoming the wide gap between developed country emission reduction pledges and what is required by science, equity and historical responsibility. The Democratic Republic of the Congo, for the African Group, stressed that agreement on a second commitment period is absolutely essential, observing that Durban should result in a legally-binding outcome under the AWG-KP. Poland, for the European Union (EU), reiterated their willingness to consider a second commitment period under the Kyoto Protocol contingent on agreement on process for a legally binding comprehensive framework . He emphasized the need to preserve the multilateral rules-based approach in Durban. Australia, for the Umbrella Group, underscored the need for an overarching agreement in Durban that is able to enhance ambition over time. She said the Kyoto Protocol alone cannot solve climate change and stressed the need for a global agreement that includes all major emitters. The Gambia, for the Least Developed Countries (LDCs), underscored the need to resolve outstanding issues to enable the adoption of a second commitment period. He also stressed the need to ensure that there is no gap between the first and subsequent commitment periods. Monaco, on behalf of the Environmental Integrity Group (EIG), highlighted the need for progress on technical issues, such as LULUCF, the transformation of emission reduction pledges into quantified emission limitation and reduction objectives (QELROs), carry-over of surplus assigned amount units (AAUs), and the flexibility mechanisms. Emphasizing that Durban should result in a second commitment period under the Kyoto Protocol, Grenada, for the Alliance of Small Island States (AOSIS), called for improving the effectiveness of the Kyoto Protocol by closing loopholes and ensuring its continuity by adopting ratifiable amendments for the second commitment period that will be provisionally applied pending entry into force. Papua New Guinea, for the Coalition of Rainforest Nations, called for rules on LULUCF to ensure accurate land-based accounting and limits on the use of surplus AAUs. She highlighted the possible role of REDD+ in complementing developed country domestic mitigation efforts and supporting developing country efforts in sustainable forest management. Egypt, for the Arab Group, stressed that a second commitment period under the AWG-KP is fundamental, reiterating that efforts to impede agreement will be detrimental to developing countries. Bolivia, speaking on behalf of the Bolivarian Alliance for the Peoples of our America (ALBA), opposed convening a spin-off group on legal issues as it might lead to a legal vacuum by giving some countries the opportunity to opt-out of future agreements. Samoa, speaking for the Cartagena Dialogue, underscored the need for the Panama meeting to deliver serious technical work on the key elements of the Cancun package and called for candid dialogue on the future of the Kyoto Protocol and the adoption of a legally-binding agreement. The International Emissions Trading Association, for Business and Industry, underscored the success of the Clean Development Mechanism (CDM) and said the CDM should not be allowed to lapse purely for political reasons. Climate Action Network, for Environmental NGOs (ENGOs), called on parties to close loopholes that can undermine emission reductions, such as LULUCF, and ensure the comparability of Annex I emission reductions commitments. The Pan-African Climate Justice Alliance, for ENGOs, lamented the refusal of some Annex I countries to inscribe targets under a second commitment period and emphasized that a pledge and review framework cannot replace the Kyoto Protocol. Fundación para la Promoción del Conocimiento Indígena, for Indigenous Peoples, called for climate change initiatives to consider the full effective participation of indigenous peoples, including free prior informed consent and ensuring the GCF and REDD+ respect and support indigenous peoples rights.

CONTACT GROUP ON ANNEX I FURTHER COMMITMENTS:

AWG-KP Chair Adrian Macey opened the contact group on Annex I parties further commitments on Saturday. He underscored that the contact group would focus on political and any issues forwarded by the substantive spin-off groups. He suggested discussing, inter alia : the extent to which the transformation of pledges into QELROs is possible in Durban; how to address the level of ambition, including the aggregate level of ambition and moving parties from the low to the high end of pledge ranges; and addressing a possible gap between commitment periods, such as through provisional application of an amendment. Saint Lucia, for AOSIS, called for: transforming current pledges on the table into QELROs to enable progress in discussions; enhancing ambition by closing loopholes; provisional application of any agreement on a second commitment period to resolve the issue of the gap; and discussion of consequential amendments. The EU called for clarity on parties pledges, including on a starting point and the length of the commitment period, which are prerequisites for determining QELROs. Reiterating that their stance on the second commitment period has not changed, Japan emphasized they would not make emission reduction pledges within the framework of a second commitment period. Australia called for strengthening accounting rules in both AWG tracks, and cautioned against developing two different sets of rules. She reiterated the need for a balanced agreement that includes all major emitters in order to avoid a gap between commitment periods. Peru emphasized the importance of a second commitment period for preserving a multilateral rules-based system, rather than a system based on pledge-and-review. New Zealand stated their willingness to take a second commitment period in the context of a comprehensive global agreement that contains legally-binding emission reduction targets for all major emitters. On the CDM, the EU explained that demand for projects and emission reduction credits will continue in Europe, regardless of adoption of a second commitment period. He also called for constructive discussions in Panama by striving for smooth continuity in the post-2012 regime, rather than emphasizing the gap between commitment periods. Venezuela, with Brazil and Bolivia, underscored that the CDM cannot function outside of the context of QELROs and, therefore, without a second commitment period. Venezuela said the CDM has a shameful record on hydrochlorofluorocarbons (HCFCs), while Bolivia highlighted their negative experiences with CDM projects. Brazil and India expressed concern about the possible proliferation of bilateral mechanisms and, with China, noted the value of the CDM. Venezuela and Nicaragua stressed that countries should not be able to select beneficial elements of the multilateral process, while neglecting difficult elements. The EU acknowledged that there is room for improvement on HCFC-23 credits and said they would be banned in the EU in the near future. He also said that ratification of a Durban decision would take time and emphasized the need to ensure continuity. Japan underscored the achievements of the CDM in promoting sustainable development in developing countries. Two further stock-taking contact group sessions convened during the week, where spin-off group facilitators reported on progress. The spin-off groups addressed the following issues:Amendments to the Kyoto Protocol pursuant to its Article 3, paragraph 9 (also known as the numbers group), co-facilitated by Leon Charles (Grenada) and Jürgen Lefevere (EU); Emissions trading and project-based mechanisms, co-facilitated by Pedro Barata (Portugal) and El Hadji Mbaye Diagne (Senegal); Land use, land-use change and forestry, co-facilitated by Marcelo Rocha (Brazil) and Peter Iversen (Denmark); Greenhouse gases, sectors and source categories, common metrics to calculate the carbon dioxide equivalence of anthropogenic emissions by sources and removals by sinks, and other methodological issues, facilitated by AWG-KP Vice-Chair Madeleine Diouf (Senegal); and Consideration of information on potential environmental, economic and social consequences, including spillover effects, of tools, policies, measures and methodologies available to Annex I Parties, facilitated by Eduardo Calvo (Peru).

Amendments/numbers

During the spin-off group on amendments to the Kyoto Protocol pursuant to its Article 3, paragraph 9, parties agreed to focus discussions on: transformation of pledges into QELROs, including the impact of LULUCF rules; streamlining options on the carryover of surplus AAUs; and working through the chapter text. Parties were not able to agree on establishing an informal group to identify further items to be elevated to the contact group on Annex I parties further commitments and the possibility of discussing Option B (consequential amendments). During the final spin-off group meeting, parties introduced a number of submissions and expressed divergent positions on the issue of share of proceeds. A submission from the Democratic Republic of Congo, on behalf of the African Group, addressed the carry-over of surplus AAUs from the first to the second commitment period, specifying that, inter alia : carry-over be limited to 1% of each party s assigned amount for the first commitment period; and parties be able to sell the carried-over amount, with 50% of the revenue to be transferred to the Adaptation Fund. The Papua New Guinea submission introduced a REDD+ mechanism to assist Annex I parties in achieving compliance with their quantified emission limitation and reduction commitments under the Protocol. In addition to submissions and the revised facilitator s note, parties agreed that work would also be guided in Durban by a table produced by the Secretariat capturing the state of technical work on the transformation of pledges into QELROs . The table will be used as a basis for discussion to assist the spin-off group on further technical discussions. In the final AWG-KP contact group on Friday, Facilitator Charles noted the productive work within the spin-off group, especially on the transformation of pledges into QELROs and on carryover AAUs. He indicated that many outstanding issues are of a political nature. Flexibility Mechanisms : In the spin-off group working on emissions trading and the project-based mechanisms, parties tried to clarify positions on general issues and agreed to remove text on discount factors under the CDM. On the continuation of the mechanisms, parties agreed that no more progress could be made on the text without a political level decision. Streamlined options from the text are contained in the new Co-Facilitators note, which will be forwarded to Durban. In AWG-KP closing plenary Co-Facilitator Barata reported on future work remaining on the issues of continuation, share of proceeds, eligibility of nuclear facilities under the CDM and Joint Implementation (JI), and mechanisms.

LULUCF :

In the spin-off group, parties addressed natural disturbances, a cap on forest management and harvested wood products. Parties exchanged views on force majeure and natural disturbances, including the commonalities and differences of both concepts. Delegates eventually agreed to a revised text on force majeure now known as disturbances, with a few issues outstanding. In the Chair s revised text (FCCC/KP/AWG/2011/CRP.1), delegates agreed to streamline text on, inter alia: reference levels; and rewetting and drainage. Some parties supported a proposal on a cap for forest management when using reference levels, which remained bracketed. Parties also addressed the proposal on flexible land use. In the AWG-KP closing plenary, many parties welcomed progress on LULUCF.

Other issues

The spin-off group on the basket of methodological issues (FCCC/KP/AWG/2011/CRP.1, Chapter IV) met only once in Panama. Parties reviewed options for language on greenhouse gases, common metrics, application of the 2006 IPCC Guidelines for National Greenhouse Gas Inventories, and cross-cutting issues. Parties discussed the two options contained in the revised proposal by the Chair, with many noting that agreement on one option is contingent on whether to include nitrogen trifluoride in the coverage of the quantified emission limitation and reduction commitments for the second commitment period. On the proposed method of work, parties discussed the relationship between issues under Chapter IV and Chapter I (Amendments to the Kyoto Protocol) and a need to proceed with discussions in an integrated manner.

AWG-KP Vice-Chair Diouf reported that parties are not yet comfortable eliminating options in the text and that more time is needed to agree on outstanding issues, while also indicating that progress in Durban is contingent on addressing political issues .

Potential consequences

The spin-off group on potential consequences (FCCC/KP/AWG/2011/CRP.1, Chapter V) met once in Panama. Parties discussed the outstanding issue on whether to establish a permanent forum as a means for parties to report and evaluate impacts and consequences of policies and measures, or to use existing channels, including national communications. Parties could not find convergence between the two issues, and the Chapter V text has been deferred to COP/MOP 7 as-is. These discussions ended with parties forwarding a revised Chair s proposal (FCCC/KP/AWG/2011/CRP.2) to capture the work undertaken in Panama and to streamline, clarify and update text contained in the Bonn Facilitator s note. All of the Facilitator s notes can be found online at http://unfccc.int/meetings/ad_hoc_working_groups/lca/items/6189.php

CLOSING PLENARY:

The closing plenary of the third part of the AWG-KP 16 took place on Friday afternoon. AWG-KP Chair Macey noted that the objective at the meeting had been to further clarify issues, find a zone of convergence on essential items, streamline proposals in the text, and get as close as possible to a draft text for Durban. He noted that parties had taken a step forward towards this goal in Panama, and had expressed a clear, strong wish to complete the work of the AWG-KP in Durban. He highlighted issues raised in Panama, including: the nature of the second commitment period; the fact that some Annex I parties have stated that they will not take up QELROs in a second commitment period under the Kyoto Protocol; and the continuation of market-based mechanisms after 2012, especially the CDM. He introduced the outcome of work in a revised proposal by the Chair (FCCC/KP/AWG/2011/CRP.2), which captures progress made in the session. In particular, he outlined the usefulness of discussions on: the transformation of pledges into QELROs under Chapter I, under which a table of possible QELROs was considered; natural disturbances under Chapter II; and discount factors and the continuation of mechanisms (Chapter III). He noted that the text under Chapters IV and V were viewed as sufficiently advanced to be forwarded to Durban, and the text remains unchanged. On future work, Chair Macey noted that many parts of the text are complete technically and now await a political decision although future technical work remains on some issues, such as LULUCF. Argentina, for the G-77/China, emphasized the need for a balanced and ambitious outcome in Durban in accordance with provisions and principles of the Convention, especially the principles of equity and common but differentiated responsibilities. He described the Kyoto Protocol as the cornerstone of the climate change regime and emphasized that the establishment of second commitment period targets are an essential requirement for Durban. They called for balanced progress under both the AWG-KP and AWG-LCA tracks, and emphasized the need for parties to ensure there is no gap between the first and second commitment periods. Switzerland, on behalf of the EIG, affirmed progress was made under the resumed session, and indicated that most remaining issues are of a political nature. Australia, for the Umbrella Group, referred to the Kyoto Protocol as an important part of efforts to reduce emissions, offering rules and infrastructure that can be used towards a new framework. She cautioned against a second commitment period of the Kyoto Protocol without a balanced agreement that covers all major emitters. She welcomed progress in Panama on new rules to incentivize emission reductions in all sectors, and called for continuity of market approaches as a keystone for a new regime. Poland, for the EU, welcomed progress on many issues, including discussions on a future legally-binding framework. He stressed the willingness of the EU to consider a second commitment period of the Kyoto Protocol, as part of a wider outcome that engages all major economies. He noted positive efforts made towards streamlining language, advancing work on the transformation of pledges into QELROs, carry-over of surplus AAUs, and the length of the commitment period. He stressed the need for continuing market-based mechanisms in order to have economically feasible emission reduction efforts. Grenada, for AOSIS, welcomed the proposals made in Panama to address the environmental integrity of the Kyoto Protocol, and called for enhanced effects to increase support for adaptation through share of proceeds under the CDM. She outlined expectations for Durban, including: a substantial increase in mitigation ambition of all Annex I parties, the adoption of a decision to establish a second commitment period under the Kyoto Protocol to run from 2013-2017 with a base year of 1990 as part of a two-track outcome; and the continuity of commitments in 2012 through the provisional application of amendments to Annex B. The Democratic Republic of Congo, for the African Group, underscored the need for full implementation of a second commitment period and lamented a lack of political will by Annex I parties on this issue. He drew attention to submissions from his Group on carry-over of surplus AAUs and LULUCF, and called on parties to close loopholes to ensure environmental integrity. The Gambia, on behalf of LDCs, reaffirmed the importance of a second commitment period under the Kyoto Protocol . Shestressed that political declarations are not sufficient for the most vulnerable countries. Bolivia, on behalf of ALBA, said they are ready to work constructively towards a second commitment period. Papua New Guinea, on behalf of the Coalition for Rainforest Nations, reiterated the need for legally-binding targets to reduce carbon emissions. El Salvador, for the Central American Integration System (SICA), called for procedural transparency and an increased scale of emission reductions from major emitting countries. Egypt, for the Arab Group, called on all Annex I parties to work towards the same goal. The Third World Network, for ENGOs, cautioned against the efforts by some Annex I countries to replace the Kyoto Protocol with a new treaty under the AWG-LCA that is likely to be a weak, domestic, pledge and review system. The Indigenous International Forum, for Indigenous Peoples Organizations (IPOs), called for respecting rights of indigenous peoples in international and national climate change and legislation. 350.org for youth NGOs drew attention to Africa as the continent representing ground zero for climate change. The International Trade Union Confederation stressed the need for just transition. The third part of AWG-KP 16 was suspended at 4:33 pm.

AD HOC WORKING GROUP FOR LONG-TERM COOPERATIVE ACTION UNDER THE CONVENTION

AWG-LCA Chair Daniel Reifsnyder (US) opened the resumed session on Saturday, 1 October, and called on parties to work on developing draft decision text on all elements under the AWG-LCA. UNFCCC Executive Secretary Christiana Figueres provided an overview on the meetings held by the Transitional Committee for the design of the GCF, noting good progress. She also reported on the first meeting of the TEC, held in Bonn, Germany in June. Bolivia highlighted the Days of Citizen Participation event, held from 16-18 September 2011, bringing together 3000 representatives of the Andean Community of Nations. On fast-start finance, AWG-LCA Chair Reifsnyder observed that submissions had been received from a number of parties (UNFCCC/CP/2011/INF.1).

AWG-LCA Chair Reifsnyder noted that work would resume on all substantive items established during the second part of AWG-LCA 14 in June. He clarified that the in-depth work identified by the facilitators during the Bonn session comprises part of the work of informal groups, and that items listed are not meant to be prescriptive. Parties agreed to the organization of work. Argentina, for the G-77/China, emphasized the group s commitment to the fulfillment of the BAP and finding appropriate solutions to issues not addressed in Cancun. He called on parties to ensure a transparent and inclusive process aimed at producing negotiating texts for Durban. Switzerland, for the EIG, emphasized the need to leave Panama with clarity on the road ahead, and a negotiating text in hand. Venezuela, for ALBA, underscored achieving the objectives of the BAP and fulfilling legal obligations, without excuses or conditionalities. The Democratic Republic of the Congo, for the African Group, called for a balanced science-based outcome in Durban to implement both the Convention and the Protocol. He expressed concern over the lack of attention given to the Adaptation Framework, and sources and scale of finance. The EU said developing draft decision text in Panama is key for a successful outcome in Durban and called for a comprehensive legally-binding framework that engages all parties. He said the ambition gap must be resolved and urged development of a robust, transparent and rigorous MRV framework. He said discussions in Panama must address the legal form, including options for Durban, and a roadmap to reach the 2ºC target. Australia, for the Umbrella Group, called for an effective global climate change framework and highlighted a package of elements that would enable progress and ensure environmental integrity, including: international consultation and analysis (ICA); international assessment and review (IAR); and MRV. She underscored, inter alia : ambitious mitigation actions by all major emitters; fully implementing the Cancun Agreements; and developing draft text on IAR, ICA and biennial reports. Saudi Arabia, for the Arab Group, stressed that adaptation to climate change involves both adaptation to the impacts of climate change and adaptation to the impacts of response measures. Grenada, for AOSIS, called on parties to finalize the design and operationalization of the essential functions of the new mechanisms established by the Cancun Agreements. She emphasized that increasing mitigation ambition should be a priority and that the outcomes of the AWG-LCA should be captured in a legally-binding instrument. Papua New Guinea, for the Coalition of Rainforest Nations, proposed working towards the adoption of a specific decision on financing options for the full implementation of REDD+ results-based actions, in Durban. El Salvador, for SICA, emphasized the need to operationalize the GCF in Durban. He urged parties to avoid parallel processes, which could marginalize and exclude some UNFCCC parties. The Gambia, for LDCs, called for discussions in Panama to lay the basis for a balanced and legally-binding outcome in Durban. Belarus, for countries with economies in transition (EITs), explained that transitional economies face difficulties moving towards a low carbon economy and require support through best practices.

ITEMS 3, 4, 5 AND 6:

This issue covers the agenda items on preparation of an outcome to be presented to COP 17; review of the long-term global goal; legal options; and other matters, including Annex I parties undergoing the process of transition to a market economy and Annex I parties whose special circumstances have been recognized by the COP. During the first meeting of the AWG-LCA contact group, AWG-LCA Chair Reifsnyder proposed, and parties agreed, to continue the work of the AWG-LCA in one contact group, which would meet periodically to touch-base on progress, while informal groups would address substantive issues. He said the groups would be organized as follows: developed country mitigation, co-facilitated by José Alberto Fernández Garibaldi (Peru) and Karine Hertzberg (Norway); developing country NAMAs, co-facilitated by Fernández Garibaldi and Herzberg; REDD+, facilitated by Antonio Gabriel La Viña (the Philippines); sectoral approaches and sector-specific actions, facilitated by George Wamukoya (Kenya); various approaches, including opportunities for using markets to enhance the cost-effectiveness of and to promote mitigation actions, facilitated by Alexa Kleysteuber (Chile); response measures, facilitated by Crispin d Auvergne (Saint Lucia); adaptation, facilitated by Kishan Kumarsingh (Trinidad and Tobago); finance, co-facilitated by Georg Børsting (Norway) and Suzanty Sitorus (Indonesia); technology transfer, facilitated by Jukka Uosukainen (Finland); capacity building, facilitated by Uosukainen; shared vision, facilitated by AWG-LCA Vice-Chair Margaret Mukahanana-Sangarwe (Zimbabwe); the Review, facilitated by AWG-LCA Vice-Chair Mukahanana-Sangarwe; legal options, facilitated by María del Socorro Flores (Mexico); and other matters, facilitated by Kunihiko Shimada (Japan). Chair Reifsnyder proposed that Burhan Gafoor (Singapore) facilitate informal discussions on the level of ambition (paragraphs 36-38 and 48-51 of the Cancun Agreements). China preferred addressing the issue in the informal groups on developed country mitigation and developing country NAMAs, which was eventually agreed to. Parties agreed that the first and last sessions of each informal group would be open to observers. Mitigation by developed countries: In the informal group, parties discussed IAR, biennial reports and level of ambition (paragraphs 36-38 in Decision 1/CP.16). The Co-Facilitators presented separate non-papers on these issues. On IAR, Australia called for making use of existing COP guidance and reviewing the extent to which parties have achieved quantified economy-wide emission reduction targets. Australia, supported by Norway, proposed integrating biennial reports and IAR into existing reporting to avoid duplication. Developing countries called for promoting consistency in accounting and comparability of efforts among developed countries through the application of common agreed rules. However, a group of developed countries said IAR needs to be complemented by an accounting system that includes carbon budget periods, LULUCF and mechanisms. Several developing country parties objected to the merging of IAR and ICA provisions. Divergent views were expressed among developing and developed countries on compliance, with the former saying that comparability and compliance are key objectives of the IAR process. Some developed countries disagreed, saying a compliance process had not been agreed to. On biennial reports, Saudi Arabia emphasized reporting on the effects of mitigation activities. The EU suggested that the objectives of guidelines, structures, the modalities for communications and the detail required in biennial reports could be captured in an annex to a decision. Singapore said that biennial reports should also function as an early warning system. Parties considered a Co-Facilitators non-paper, with many developing countries highlighting that, inter alia : information in the biennial reports should be based on common accounting rules and performance indicators as a way to improve transparency and comparability; and that there be no parallelism with biennial update reports for developing countries. Several developed countries supported diverse accounting methodologies to reflect the wide range of methods available to reduce emissions. On level of ambition, parties examined options and means to increase commitments and advance work in the lead-up to Durban. Some developed countries requested a common space to discuss the level of ambition, which many developing countries opposed, underscoring the different nature and content of the provisions on the level of ambition for developed countries and the provisions on NAMAs for developing countries (paragraphs 48-51 of decision 1/CP.16). During the final AWG-LCA contact group meeting on Friday, Co-Facilitator Fernández Garibaldi reported that the group had developed three non-papers on: possible elements of a draft for biennial reports of developed countries; possible elements of modalities for IAR; and a Co-Facilitators summary of discussion on paragraphs 36-38 (level of ambition). On the way forward, parties agreed to set deadlines for submissions and prepare a revised version before Durban.

Mitigation by developing countries

In the informal group, parties addressed ICA, biennial update reports, the NAMA Registry and developing country mitigation actions (paragraphs 48-51 of Decision 1/CP.16). Parties considered separate non-papers prepared by the Co-Facilitators on each of these issues. On ICA, parties addressed the principles, objectives and possible steps for the process. Some developing countries emphasized that IAR and ICA respond to different objectives, and that while IAR is meant to assess and review the commitments made by Annex I parties and their comparability of efforts, ICA is intended to increase transparency of voluntary mitigation actions, especially those that are internationally supported. Many developing countries highlighted that the ICA frequency was not established under the Cancun Agreements and should be flexible depending on national circumstances. The US said ICA should go hand-in-hand with biennial reports and should provide input for the Review. Some developed countries said the ICA process should first address an analysis by experts, including impacts of mitigation actions, methodologies and assumptions, and then carry out a consultation to share views among parties in the SBI. Some developing countries highlighted that international consultation and analysis implies a sequence of how the process should be carried out. China said ICA should be a technical process and developing countries expressed concerns about the intrusion of technical experts carrying out in-country visits. When addressing the non-paper prepared by the Co-Facilitators, some parties pointed to further streamlining objectives and principles with the Cancun Agreements. On biennial update reports, parties addressed the scope and content, possible elements, level of detail to be reported and the submission cycle. On content, some developing countries highlighted that the Cancun Agreements provide clear guidance on the core elements to be addressed. Australia called for progress on biennial update reporting guidelines to create a framework to enable developing countries to begin the process and suggested, with the EU, January 2014 as a date for the submission of the first biennial update report. Many developed countries supported using the biennial update report as an input for the 2015 Review. Developing countries said frequency should be related to the provision of support and consideration of respective capabilities of countries. Discussing the Co-Facilitators non-paper, many developing countries said the text should be further streamlined with relevant provisions of the Cancun Agreements and guidelines for Non-Annex I parties national communications. On developing country mitigation actions, some developed countries called for a better understanding of the diversity, and assumptions behind, developing country pledges. Some developed countries supported preparing templates or standardizing NAMAs, which was opposed by many developing countries that pointed to the need for flexibility and understanding of the diversity of NAMAs. Some developing countries emphasized that the Cancun Agreements provide that NAMAs should be supported and enabled by technology transfer, financing and capacity building. On the NAMA Registry, many parties expressed a common view that the registry should be web based and facilitate the matching of NAMAs seeking support and available support. Many developing countries said the registry should not become a prior requirement or bottleneck to access funding, including from the GCF. Many stressed the need for the registry to promote and enhance capacity building, respect the diversity of NAMAs, and have a design that is not burdensome. During the final AWG-LCA contact group meeting on Friday, Co-Facilitator Hertzberg reported that the group had produced non papers on: the NAMA Registry; possible elements for the biennial update reports for developing countries; possible elements of modalities and procedures of ICA; and a Co-Facilitators note on paragraphs 48-51 of the Cancun Agreements. Parties agreed that submissions would be received and a revised version of the non-papers will be prepared before Durban .

REDD+

In the informal group, parties addressed REDD+ financing. The Coalition of Rainforest Nations presented a proposal on financing for Phase 3 (full implementation). On Friday, 7 October, a non-paper on REDD+ finance was prepared by the facilitator containing potential elements and sources on REDD+ finance. On sources of financing, many parties highlighted that REDD+ should be supported through different financing sources that are optional for each country. Many parties underscored the need to include a REDD+ specific window under the GCF. Cautioning against duplication, some parties said this was being addressed by the Transitional Committee for the design of the GCF. Some parties noted that a possible outcome for Durban will be contingent on the outcome of ongoing relevant discussions under the SBSTA and the Transitional Committee, while others emphasized that discussions in the group should be independent from discussions in other fora. During the final AWG-LCA contact group meeting on Friday, reporting on REDD+, Co-Facilitator La Viña said the group had produced a non-paper, which he referred to as a placeholder text containing elements for operational parts of a draft decision. Sectoral approaches and sector-specific actions: Throughout the week, parties based discussions on the general framework, agriculture and emissions from international aviation and maritime transport. On the general framework, a joint submission (FCCC/AWGLCA/2011/CRP.22) by a number of developing countries emphasized, inter alia : the importance of food security; the need to avoid barriers and distortions in international trade; and the importance of economic and social development in the context of sectoral approaches. On agriculture, parties considered language and worked to identify shared views on aspects of food security, trade, economic development and poverty eradication. Facilitator Wamukoya distributed a guidance paper to facilitate the consolidation of text and parties agreed to work towards further streamlining it based on submissions, with input from the Facilitator s guidance paper and the Bonn Facilitator s note. On international aviation and shipping, parties reflected on options for text. Some developed countries welcomed progress made by the International Maritime Organization (IMO) at the 62nd session of the Marine Environment Protection Committee, while other parties doubted the extent to which the measures will be applied globally due to the majority rather than consensus decision.

A Facilitator s note, which comprises primarily of consolidated texts from party proposals, will be used for guidance on the way forward. Parties were encouraged to further discuss and exchange views in order to reach some form of agreement at COP 17. During the final AWG-LCA contact group, Facilitator Wamukoya noted progress made on the general framework, agriculture and international bunker fuels. He said parties had divergent views on the textual options, which are contained in a Facilitator s note to go forward to Durban.

Market and non-market approaches

During informal group discussions, parties initially exchanged views on the mandate of the group to consider new market mechanisms. An 18-page compilation of proposals was produced, which is categorized under eight headings: preamble; principles and objectives for various approaches; evaluating existing approaches and lessons learned; conditionalities; framework for various approaches; new approaches; work programme; and readiness. During the final AWG-LCA contact group meeting on Friday, Facilitator Kleysteuber reported that parties will review and streamline the compilation document before Durban, and that it will be used as the basis of discussion for a draft decision.

Response measures

Developing countries stressed the importance of this issue as part of a Durban outcome. In the informal group, developing country parties discussed, and expressed appreciation for the: Joint Workshop on Matters relating to Article 2.3 (adverse impacts of policies and measures) and 3.14 (adverse impacts of response measures), held 19-20 September 2011; workshop on promoting risk management approaches on the specific needs and concerns of developing country parties arising from the impact of the implementation of response measures (decision 1/CP.10), held 21 September 2011; and the joint SBI/SBSTA forum on the impact of the implementation of response measures, held in June 2011. In the final meeting of the group, parties reviewed a Facilitator s note containing a summary of discussions and issues. The main questions summarized in the note include: whether discussions should take place under the AWG-LCA and the objective of such discussions; whether the draft text should be used as a basis for negotiations; and whether the group has a mandate to discuss trade.Many developing countries expressed reservations with the note, lamenting that their views were not adequately reflected while Canada and Australia welcomed the Facilitator s note. During the final AWG-LCA contact group meeting on Friday, Facilitator d Auvergne reported an active exchange by parties, but said that outstanding issues remained. Saudi Arabia expressed disappointment that the group did not produce text to take forward to Durban. A Facilitator s note, which summarizes the main issues of discussion and party submissions, will be made available.

Adaptation

Discussions in this group centered around three areas: the operational modalities for performing the functions of the Adaptation Committee; the composition of the Committee; and linkages with new and existing institutions under the Convention. Parties views diverged on the composition of the Adaptation Committee, with developing countries noting the need for input from vulnerable countries. The EU highlighted the urgency of finalizing draft decision text in Durban in order to operationalize the Committee. Parties discussed possible activities for the Committee, including: providing guidance and technical support to parties upon request, including through workshops and meetings; compiling, reviewing, synthesizing and disseminating information, knowledge, experiences and good practices, including through regional centers and networks, and national entities; developing and preparing targeted reports, technical papers, guidance materials, methodologies, web-based resources and other knowledge products; and creating channels and mechanisms to exchange information, knowledge and expertise, including through the creation of networks at the regional and international levels. During the final AWG-LCA contact group meeting on Friday, Facilitator Kumarsingh reported that the group had agreed to a draft decision text based on a consolidated text, which incorporates views expressed and submissions from eight parties in the group. He further noted that text still needs to be negotiated, especially regarding the composition and procedures of the Adaptation Committee.

Finance:

Discussions in the informal group centered on the proposed Standing Committee for the Financial Mechanism under the Convention and long-term finance. On the Standing Committee, parties considered proposals from: Pakistan; Australia, Canada, Japan, New Zealand and the US; and Switzerland. The structure of a draft decision on the Standing Committee was also addressed. Parties agreed to consolidate textual submissions to form the basis for further discussion, with the proviso that all party submissions remain on the table. On long-term finance, there was initial disagreement on whether the issue should be discussed at all. Parties then considered a new submission from Barbados, for AOSIS, and the Gambia, for LDCs. However, parties disagreed on whether the submissions should be consolidated, which many developing countries supported. Several developed countries maintained that consolidated text on the issue was premature. The mandate of the AWG-LCA to discuss long-term finance was also questioned. Many developing countries further requested the Co-Facilitator to consolidate all the proposals from parties on the Standing Committee and long-term finance into a single draft text for consideration. However, some developed countries preferred to address long-term finance by further discussing issues, such as climate finance and public versus private finance. The EU then submitted their proposal under this issue. A joint proposal from Australia, Canada and Japan was also submitted. Parties then agreed to consolidate all submissions on long-term finance. In the final AWG-LCA contact group, Co-Facilitator Sitorus reported that the group produced draft Co-Facilitators consolidated text, one on long-term finance and one on the Standing Committee. She said parties comments, along with additional submissions, will be incorporated into revised text for Durban.

Technology

Parties focused discussions on various aspects of the CTCN including: the relationship between the host and the COP and the TEC; linkages between the TEC and the CTCN; respective roles of the CTCN; and the function and composition of a proposed selection panel for reviewing host proposals. A revised text was produced and contains language on, inter alia , the proposed mission, functions, architecture, roles and responsibilities network, budget, financial means and estimate of expected funding, governance, organizational structure, reporting and review, and terms of agreement for the CTCN. Submissions were received from the G-77/China and the EU, and a joint submission was received from Japan and the US, which highlighted selection process for the host of the CTCN, financing of the CTCN, and clarity on the interaction between the TEC and the CTCN. In the final AWG-LCA contact group, Facilitator Uosukainen reported that parties expressed divergent views on the role of the CTCN, but agreed on the revised second draft text as a basis for discussions for draft decision text in Durban.

Capacity Building

Discussions in the informal group addressed the need for more coherence of capacity building under the different UNFCCC processes and emphasized the cross-cutting nature of capacity building. Parties discussed gaps in the delivery of capacity building as either integrated elements of projects and programmes or stand-alone activities. Parties discussed where, and how, capacity building is integrated in the mandates and work programmes of the LDC Expert Group (LEG) and the Consultative Group of Experts (CGE). Earlier in the week, the Facilitatorproduced a compilation of draft texts for a draft decision on capacity building, which addresses, inter alia: ways to enhance the monitoring and review of the effectiveness of capacity building; modalities regarding institutional arrangements for capacity building; and activities and reporting by parties on capacity building. In the final AWG-LCA contact group, Co-Facilitator Uosukainen said the group produced a compilation of submissions in a draft text to be the basis of discussions to be taken further in Durban.

Shared Vision

The informal group on shared vision met four times in Panama. AWG-LCA Vice-Chair Mukahanana-Sangarwe asked for proposals and suggestions on the way forward in developing draft negotiating text for Durban. Divergent views emerged over how to proceed. Delegates discussed whether the Facilitator s note from the Bonn meeting could be considered as a basis for further discussion, with some stating that it should be further developed based on views and submissions, and others expressing concern that the scope of the note was too wide. Developing countries said they expected all submissions by parties to be included in the negotiating text, with some countries reiterating that the shared vision should be in the context of the BAP. Many developed countries said the shared vision should be based on the two issues mandated from Cancun, that is, the long-term global goal and the peak year. One developing country said that the underlying basis of the goals must be agreed to before the specific goals themselves, and that decisions should be based on equity. The group considered a revised text and discussed the status of the paper, with some reiterating that it was still a Facilitator s text, including consolidated views of parties, and not a draft decision text that could be used as the basis for negotiation in Durban. Some delegates expressed concern that their submissions were not well reflected in the new text, and others noted that the text was getting too long and needed to be further streamlined. Delegates then considered a further iteration of the text. In Friday s contact group, AWG-LCA Vice-Chair Mukahanana-Sangarwe reported that the text would be forwarded to Durban as a non-paper, and hoped that consultations would continue intersessionally to further streamline the text.

Review

Parties focused discussions on elements of the Facilitator s note from the Bonn session. Many parties highlighted the need to address modalities, followed by a consideration of scope. Some parties called for their submissions to be better reflected in the Facilitator s note while some requested the opportunity to provide further input. A developing country cautioned against overlapping issues addressed in other informal groups, suggesting that the group concentrate on what is feasible and practical in the Review. Parties views differed on the definition of the scope, with some noting that it was adequately laid out in the Cancun Agreements and others expressing the need for further definition. Parties expressed divergent views on next steps; some parties emphasized that it was premature to start discussing draft decision text, while others reiterated the need for draft decision text to be finalized before Durban. On Thursday, 6 October, an updated non-paper was issued on further definition of the Review s scope and development of its modalities. Legal Options: Parties held an initial exchange of views on expectations for Durban, with some supporting further discussions on legal options, and others stating that discussions on legal options and a new legally-binding agreement were premature, and that agreement on substance must come before considering the legal form. Some parties proposed that a mandate should be agreed to in Durban, establishing a process for developing a legally-binding agreement, which would include mitigation commitments and actions by all parties. Some developed countries expressed a willingness to consider a second commitment period under the Kyoto Protocol, provided that a comprehensive legally-binding framework adaptable to evolving circumstances is also considered. Many developing countries highlighted that the Durban outcome should be based on the BAP and the Convention. The US said: parties have different interpretations of the BAP and that the Durban outcome should be based on the Cancun Agreements; the outcome in Durban and aspirations must be realistic; and that it would not launch negotiations on an agreement it would not be able to sign on to. Based on the views expressed by parties, Facilitator María del Socorro Flores then prepared a paper with a menu of legal options, setting out a range of possible options for a Durban outcome, including; a legally binding instrument (LBI); and COP decisions, with various sub-options. These include: a mandate to conclude an LBI with a clear roadmap; a declaration regarding the future instrument, leaving the legal form open; continuing discussions to identify the appropriate form of the different elements of the agreed outcome; affirming the importance of an LBI; and continuing to address all the BAP pillars. One party expressed that the political conditions were not right to agree to a mandate to conclude an LBI in Durban, while another said the Cancun mandate was to discuss legal options, not to discuss a mandate to conclude an LBI. The EU supported the option of a mandate to conclude an LBI and proposed six elements for inclusion in such a mandate, including a clear end date for negotiations. AOSIS outlined its proposal for possible elements for an LBI. The Gambia, for the LDCs, said any political statement or declaration that leaves the legal form open was unacceptable. The US said the list of options provided a reasonable reflection of multiple ideas that could be taken forward. The group agreed to continue discussions on this issue in Durban. Reporting back in the AWG-LCA contact group on Friday, Facilitator Socorro Flores said convening the group had enabled parties to provide greater detail on their positions and better understand each other s views, and to focus on what they could achieve as an outcome in Durban. She reiterated that some believed Durban should achieve a time-bound mandate for a LBI, while others wanted clarity on substance before agreeing on the legal form. She said discussions would continue to see how parties preferred options could be elaborated and the menu of options would be further discussed.

Other matters

During the final AWG-LCA contact group meeting, Facilitator Shimada reported on consultations regarding: Annex I parties undergoing the process of transition to a market economy (EITs); and Annex I parties whose special circumstances have been recognized by the COP. He noted a rich exchange of views on the issues during the consultations. He said EIT parties provided clarification on their proposed draft decision regarding when the transition was expected to be completed, as well as the implications for the Convention. Regarding the draft decision submitted by Turkey, he said participants discussed clarification on the duration of the special circumstances, and that discussions would continue to further clarify the issues intersessionally, as well as in Durban. All of the Facilitator s notes can be found online at http://unfccc.int/meetings/ad_hoc_working_groups/lca/items/6189.php

CLOSING PLENARY:

The AWG-LCA closing plenary convened on Friday afternoon. Executive Secretary Figueres paid tribute to Nobel Laureate Wangari Maathai, describing her as a champion for the environment, sustainable development, women s rights and democracy. Kenya expressed appreciation for the tribute, observing that it was in recognition of Maathai s efforts to serve mankind with dedication. Delegates then observed a one-minute silence in memory of Wangari Maathai.

AWG-LCA Chair Reifsnyder noted that submissions received from parties during the third part of session had been compiled online in documents FCCC/AWGLCA/2011/MISC.6/Add.4, MISC.7/Add.5, and MISC.7/Add.6, as well as FCCC/AWGLCA/2011/CRP.14-23. South Africa reported on consultations, which she said had been conducted in a spirit of give-and-take, highlighting the distinct sense that the Durban outcome must be balanced, fair and credible, and strengthen the multilateral rules-based response to climate change. She called for operationalizing the key mechanisms of the Cancun Agreements, and underscored the need to find a resolution to the issue of the second commitment period under the Kyoto Protocol and the legal nature of a future climate change system. Argentina, for the G-77/China, acknowledged flexibility shown in enabling progress and expressed hope that this constructive spirit would prevail in Durban. He reaffirmed the commitment of the group to move forward on both tracks, reiterating that the Kyoto Protocol and the Convention must be preserved. He called for fair and equal treatment of all issues in Durban. Highlighting the importance of response measures for all developing countries, he expressed disappointment with the unwillingness of developed countries to make progress, which had resulted in no outcome during the session. Grenada, for AOSIS, called for Durban to deliver a clear and ambitious mandate to negotiate a legally-binding agreement under the Convention and a second commitment period under the Kyoto Protocol. On the GCF, she expressed concern about the messages sent from this meeting regarding the commitment of developed countries to capitalize the fund. She urged all parties to consider the reality of the impacts of climate change on small island developing states when finalizing their negotiating positions. She reiterated that efforts in Durban should aim to strengthen the multilateral rules-based regime. El Salvador, for SICA, said the meeting has laid a solid foundation for Durban. The Gambia, for the LDCs, called for progress on accounting rules to ensure comparability of efforts. Australia, for the Umbrella Group, said the meeting in Panama represented an important advance towards Durban on issues such as mitigation, finance, technology and capacity building to enable discussions in Durban. She underscored their remaining commitment to the long-term financial goal, underscoring that Durban must bring the Cancun Agreements to life. The EU welcomed progress made, and reiterated their preference for a single legally-binding framework containing the essential elements identified in the Cancun Agreements as a means to reach a balanced and ambitious outcome. Since believing this would not be achievable in Durban, they supported agreeing on a mandate in Durban to conclude an LBI. In this context, he reiterated the EU s support for a second commitment period under the Kyoto Protocol and highlighted a robust market-based system as essential in achieving the global mitigation objectives. Switzerland, for the EIG, welcomed progress in Panama, but underscored outstanding work on the road to Durban. He called for progress on issues, such as MRV, biennial reports, ICA and IAR, market mechanisms, REDD+, loss and damage, technology, mid and long-term finance, and capacity building. Ecuador, for ALBA, underscored a tendency by some parties to distract attention away from the principle objectives of the Convention by focusing on technical and procedural issues. She said parties advocating for a legally-binding agreement needed to show that they respect the laws and current rules and adopt a second commitment period under the Kyoto Protocol. Saudi Arabia, for the Arab Group, said developing countries showed their full commitment towards making progress in Panama through their positive participation in all working groups and across all subjects. He added that some developed countries that attempted to impede negotiations on long-term finance and response measures had not reciprocated this commitment. On REDD+, Papua New Guinea, for the Coalition of Rainforest Countries, expressed disappointment that negotiations had only resulted in a non-paper with a placeholder for text. The Democratic Republic of Congo, for the African Group, highlighted that progress in Panama was uneven among the different issues under negotiation. He expressed concern over the slow progress on finance and the AWG-KP track. He called for, inter alia : a common accounting framework for Annex I parties that are not parties to the Kyoto Protocol; comparability of efforts among Annex I parties; and progress on finance, REDD+ and loss and damage. Peru, for Colombia, Chile, Guatemala and Panama, reaffirmed a second commitment period under the Kyoto Protocol as a decisive outcome in Durban and a key milestone for achieving a multilateral comprehensive legally-binding rules-based regime. She encouraged the incoming COP 17 Presidency to continue consultations on the legal options. Belarus, for Kazakhstan, Ukraine and Russia, for EITs, recognized a step forward in resolving to take into consideration the special situation of the EITs. Centro Mexicano de Derecho Ambiental, on behalf of the Climate Action Network, stressed that the fate of Kyoto Protocol is in the EU s hands and called on Japan, Canada and Russia not to destroy the Kyoto Protocol. Pan-African Climate Justice Alliance, for Climate Justice Now, called for further progress on developing countries concerns, including on response measures and long-term finance, as agreed to in Cancun, to ensure the GCF does not become an empty shell. Tebtebba Foundation, for IPOs, called for the recognition of the rights of indigenous peoples, including the right to self-determination and free prior informed consent. Chair Reifsnyder thanked everyone for their hard work and suspended the meeting at 6:18 pm.

A BRIEF ANALYSIS OF THE MEETING

Panama connects all the cardinal directions, north and south by virtue of its location, and east and west by virtue of the legendary Panama Canal. UNFCCC Executive Secretary Christiana Figueres made this symbolic statement during the opening of the final round of talks in Panama before the crucial climate change conference in Durban convenes in December. Indeed many delegates came to Panama hoping to unite, bridge differences and smooth the trajectory towards Durban. And in some areas they did. However, the meeting also exacerbated chasms and highlighted the wide gulf that still exists on vital issues such as Review, [of the long-term global goal], finance, and overall expectations for Durban.This analysis explores some of the gaps in ambition, finance, and emission reduction commitments in the context of the Panama meeting and highlights possible implications for Durban.

MIND THE AMBITION GAP

Governments in Copenhagen and Cancun agreed to hold the temperature increase to below 2ºC above pre-industrial levels. In 2010 developed and developing countries communicated their emission reduction pledges as called for in the Copenhagen Accord. However, a closer look at those submitted pledges shows that the world is still on course for a global temperature increase far above 2ºC. AOSIS has consistently called for bridging the gap between the level of ambition of party pledges and the emission reductions required by science, highlighting that an increase of more than 1.5ºC would entail catastrophic consequences for the small islands. With China and some other developing countries representing a significant share of the world s emissions, discussions on the level of ambition require engagement from both developed and developing countries. However, attempts to convene a common space for dialogue failed once again in Panama with many developing countries pointing to the different nature of developed countries mitigation actions and commitments, compared to the voluntary nature of developing countries NAMAs. Finding a way to ensure that commitments and actions by countries can keep the temperature increase below the 2ºC target is thus one of the major challenges facing the negotiations. Enhanced action on mitigation, including a scaling-up of global ambition, will be required. In this regard, many developed and developing countries strongly supported further clarification of mitigation efforts, including by establishing a common international accounting framework, which implies further development of Monitoring, Reporting and Verification (MRV) rules. In Cancun, governments agreed to review the adequacy of the 2ºC target, on the basis of the best available science, including in relation to a 1.5ºC increase in temperature. The Review, foreseen to take place between 2013 and 2015, should be carried out in the light of the ultimate objective of the Convention, and overall progress towards achieving it. This verification performed by the international community on whether it is on track towards meeting its goals is expected to lead to appropriate action. In Durban, governments need to decide on the scope, the modalities and the process for the Review, but different perspectives remain among parties. Discussions on the Review were difficult in Panama, as parties expressed divergent views on its scope. AOSIS advocated for keeping the focus on the adequacy of the long-term global goal, while some other countries suggested that the Cancun Agreements mandate the consideration of broader overall progress towards achieving the global goal, including on, inter alia , means of implementation, financial and technological needs.

MRV of mitigation reduction actions for developed and developing countries is another key element to ensure the effectiveness of mitigation activities. The Cancun Agreements established the basis for strengthening these aspects with different requirements for developed and developing countries. In Panama disputes emerged over parallels between elements proposed for IAR and biennial reports for developed countries and ICA and biennial update reports for developing countries. While many developed countries underscored MRV as a core element of the Durban outcome, developing countries continued to highlight the Convention s principle of common but differentiated responsibilities as the flag that should guide these discussions.

SHOW ME THE MONEY

Finance is the common thread that underpins the future viability and credibility of mechanisms, including on adaptation and technology, which were established under the Cancun Agreements and are set to be operationalized in Durban. Developing countries see financial commitments by developed countries as a precondition for undertaking any action on climate change and are now raising questions about the possibility of a financing gap, expressing fears that the Green Climate Fund will just be an empty shell. The problem arises from the ambiguity of the financing provision in the Copenhagen Accord. In the Accord, developed countries commit to provide US$30 billion for the period 2010-2012 and to jointly mobilize US$100 billion dollars a year by 2020 to address the needs of developing countries. The big question is what happens in the intervening years between 2012 and 2020? The EU, US and other developed countries have consistently played down concerns, maintaining their commitment to mobilize financial resources from a mix of both private and public sources. In the name of transparency, developed countries have also gone to great lengths to showcase fast-start finance activities and an information event on this took place in Panama, which provided an opportunity to present and discuss key lessons learned in the implementation of Fast-Start Finance. However, against the backdrop of the prevailing debt crisis and a gloomy, global economic outlook these assurances do not sit comfortably with many. The G-77 fought hard in Panama to keep the focus on long-term financing, which developed countries were initially reluctant to address, saying that it had been adequately considered in the report of the Secretary-General s High-level Advisory Group on Climate Change Financing and elsewhere. At one point is seemed as if the finance discussions might break down entirely until the EU extended an olive branch by tabling a submission on long-term finance. This was followed by a joint submission from Japan, Canada and Australia. These submissions reaffirm the commitment of these countries to long-term financing. The reality is that without explicit agreement on finance that satisfies developing countries, it is going to be difficult to agree on anything else.

TO MANDATE OR NOT

As everybody knows, the Kyoto Protocol s first commitment period is set to expire in 2012. Durban is supposed to be the last chance to agree on a second commitment period in order to avoid a gap, which would ensure that the package of rules developed under the Kyoto Protocol, including the implementation of flexibility mechanisms, will continue to operate seamlessly. However, agreement on a second commitment period appears to be more elusive than ever. Japan, Canada and the Russian Federation will not be on board for a second commitment period under the Kyoto Protocol. The EU s position is that it wants a balanced deal that is going to put us on the road to a new global deal on climate action. The EU has said that it will agree to a second commitment period under the Kyoto Protocol, as long as delegates in Durban agree to a mandate for a path forward for a legally-binding instrument under the Convention, a position it sees as a major concession on its part since Bali. However, in the closing US press conference, the US reiterated its position that they did not believe the conditions were ripe for such a mandate, and that we would be better served by focusing on implementing existing agreements and scaling up actions. The US wants commitments from all major economies that are not conditional on funding. I do not see a meeting of the minds on these fundamental issues, said Jonathan Pershing, the lead negotiator for the US. At the same time, G-77/China members are also split on some of these fundamental issues. While all developing countries want to keep the Kyoto Protocol alive, they diverge regarding their views on a new agreement under the Convention. For example, AOSIS is very clear that it wants a legally-binding instrument and has presented a detailed proposal on possible elements for Protocol or other legally-binding agreement under the Convention. India and China, on the other hand, are not supportive of a mandate to negotiate a new agreement under the Convention. If there is no second commitment period under the Kyoto Protocol this raises serious legal and institutional questions concerning the continuity of the mechanisms under the Protocol, such as the CDM. There are those who maintain that the Kyoto mechanisms can continue because they have a double objective, namely to assist Annex I parties in meeting their emission reduction commitments as well as to assist developing countries in attaining sustainable development. However, others say that the raison d être is to assist Annex I parties to meet their commitments and if there are no commitments under a second commitment period then the mechanisms cannot continue. In other words, there is no either/or: both conditions have to be satisfied. No one can predict the future or the outcome in Durban. Many elements that are intrinsically interwoven need to be addressed, such as the fate of a second commitment period under the Kyoto Protocol. Furthermore, clarity on what the landscape looks like for a future global climate agreement is one of the most difficult political issues that Ministers in Durban will have to grapple with. However, as many have said, what Durban really needs to do is bridge the political differences so that they reflect reality on the ground and what is really needed to address climate change.

UPCOMING MEETINGS

South Pacific Regional Writeshop to Support Developing Country Publications on Disaster Risk Reduction and Adaptation to Climate Change: The Writeshop will be hosted by the Secretariat of the Pacific Regional Environment Programme (SPREP) and the University of the South Pacific (USP), with support of the United Nations Institute for Training and Research. The Writeshop will address topics relevant to climate change adaptation and disaster risk reduction including policies, institutions and governance issues to adaptation and disaster risk reduction, and experiences with specific extreme climate events in the region. dates: 10-14 October 2011 location: Suva, Fiji contact: Taito Nakalevu, Project Manager phone: +685-21929 fax: +685-20231 e-mail: taiton@sprep.org www: http://www.sprep.org/climate_change/PACC/pacc_news_detail.asp?id=985 Climate Change: How to Secure Our Future Well Being: A Health and Security Perspective : This high-level briefing aims to identify solutions around climate change and the implications for health and security. Senior military and medical professionals will deliver briefings on health impacts and security implications of climate change. Engagement with the business community is encouraged. The event is co-sponsored by several international groups including Chatham House, the Climate and Health Council, the European Climate Foundation, the Society of Biology, London School of Hygiene and Tropical Medicine, and the Health and Environment Alliance. date: 17 October 2011 location: London, UK contact: Geetha Balasubramaniam phone: +44-20-7383-6396 email: climatechange@bmj.com www: http://climatechange.bmj.com WRCP - Climate Research in Service to Society: Co-sponsored by WMO, the World Climate Research Programme (WCRP) Open Science Conference on Climate Research in Service to Society will identify key scientific challenges and opportunities to advance understanding and prediction of variability and change of the Earth s climate system on all space and time scales. dates: 24-28 October 2011 location: Denver, Colorado, USA contact: WCRP Joint Planning Staff phone: +41-22-730-8111 fax: +41-22-730-8036 email: wcrp@wmo.int www: http://conference2011.wcrp-climate.org/ Caribbean Regional Writeshop to Support Developing Country Publications on Adaptation to Climate Change and Disaster Risk Reduction: The Stockholm Environment Institute (SEI), the UN International Strategy for Disaster Reduction (ISDR) and the University of the West Indies are calling for applications from young scholars, practitioners, policymakers and others from the Caribbean who are working in the field of climate change and disaster risk reduction to participate in a Writeshop. Through the Writeshop, participants are expected to produce a peer-review, publishable quality article and they will gain enhanced awareness of the process of writing papers for academic journals. These skills will allow their work to be eligible for incorporation into publications of the Intergovernmental Panel on Climate Change (IPCC) and other high-level scientific bodies and consequently inform policy making on key issues of risk and climate. dates: 24-28 October 2011 location: Bridgetown, Barbados phone: +1-530-753-3035 email: writeshop@sei-us.org www: http://www.sei-international.org/projects?prid=1750 Joint IPCC WGI and WGII Session: This meeting will be held back to back with IPCC 34. It is scheduled to approve the Special Report of the Intergovernmental Panel on Climate Change (IPCC) on Managing the Risks of Extreme Events and Disasters to Advance Climate Change Adaptation Summary for Policymakers and accept the underlying document. dates: 14-17 November 2011 location: Kampala, Uganda contact: IPCC Secretariat phone: +41-22-730-8208 fax: +41-22-730-8025 email: IPCC-Sec@wmo.int www: http://www.ipcc.ch/ IPCC 34th Session: The 34th session of the IPCC will consider the Managing the Risks of Extreme Events and Disasters to Advance Climate Change Adaptation report, scheduled to be approved by the preceding joint sessions of IPCC Working Groups I and II. The session will also continue consideration of the IPCC review among other matters. dates: 18-19 November 2011 location: Kampala, Uganda contact: IPCC Secretariat phone: +41-22-730-8208 fax: +41-22-730-8025 email: IPCC-Sec@wmo.int www: http://www.ipcc.ch/9t h Meeting of the Vienna Convention COP and 23rd Montreal Protocol MOP: The 23rd session of the Meeting of the Parties to the Montreal Protocol on Substances that Deplete the Ozone Layer (MOP 23) and ninth meeting of the Conference of the Parties to the Vienna Convention for the Protection of the Ozone Layer (COP 9) are scheduled to take place in November. dates: 21-25 November 2011 location: Bali, Indonesia contact: Ozone Secretariat phone: + 254-20-762-3851 fax: +254-20-762-4691 email: ozoneinfo@unep.org www: http://ozone.unep.org 11th World Congress of the Organization of World Heritage Cities: World Heritage Cities and Climate Change: The theme of the 11th World Congress of the Organization of World Heritage Cities is World Heritage Cities and Climate Change. The Congress will include sessions on adaptation and mitigation measures to be taken by historic cities, a poster session featuring case studies related to the theme of the Congress, and activities for a select group of journalists, who will contribute their views about the relations between heritage and climate change. dates: 22-25 November 2011 location: Sintra, Portugal contact: Kerstin Manz, UNESCO phone: +33-(0)1-4568-1202 email: k.manz@unesco.org www: http://whc.unesco.org/en/events/739 UNFCCC COP 17 and COP/MOP 7 : The 17th session of the UNFCCC Conference of the Parties (COP 17) and the 7th session of the Meeting of the Parties (MOP 7) to the Kyoto Protocol will take place in Durban, South Africa. The 35th session of the Subsidiary Body for Implementation (SBI), the 35th session of the Subsidiary Body for Scientific and Technological Advice (SBSTA), the Ad Hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol (AWG-KP), and the Ad Hoc Working Group on Long-term Cooperative Action under the Convention (AWG-LCA) will also meet. dates: 28 November 9 December 2011 location: Durban, South Africa contact: UNFCCC Secretariat phone: + 49-228-815-1000 fax: + 49-228-815-1999 email: secretariat@unfccc.int www: http://unfccc.int/ and http://www.cop17durban.com