A new 700-page report has warned that the world could slide into the equivalent of a 1930s type depression with costs of ?3.68 trillion ($6.98 trillion) if nations fail to address climate change ‘realities’ head

on and calls for more taxation on air transport amongst many other recommendations.
Produced by leading economist Sir Nicholas Stern and commissioned by the UK Chancellor of the Exchequer Gordon Brown, the report published today predicts devastating economic ramifications for economies all around the world and calls for increased taxes on commercial flights (between ?5/$9 for European flights and ?10/$19 for long-haul flights); smaller cars; energy intense appliances and a new coordinated and international approach to green taxes.
The report which was leaked yesterday says: ‘Our actions over the coming few decades could create risks of major disruption to economic and social activity, later in this century and in the next, on a scale similar to those associated with the great wars and the economic depression of the first half of the 20th century.’
Stern's report has already captured worldwide media and political attention like no other since it quantifies the economic consequences of doing nothing, while strongly suggesting that much can still be done to reverse some of the damage already claimed to have been caused to the environment by human influences. Stern's credentials as the former Chief Economist at the World Bank are also widely respected internationally.
His report claims that the world needs to invest 1% of its GDP, or ?184bn ($349bn) now, if it is to avoid costs mounting to some 20 times that in ten year's time and it also calls on the world's nations to sign and act upon the Kyoto Agreement now.
Following the release of the report, Chancellor Brown is now likely to call for a European Union-wide target for emissions reductions of 30% by 2020 and 60% by 2050 and he is also likely to follow its recommendations that this programme should be coordinated with schemes already operating in non-EU countries.
Interestingly, the two main opposition parties in the UK have also pledged themselves to cutting emissions and while both are currently seemingly unelectable, this would seem to pave a smooth political path for the new wave of UK taxes that Chancellor Brown is expected to unveil within his next budget and more that he will propose to the European Union.
That airlines are already taking this development extremely seriously is much in evidence with an imminent meeting of 34 of them planned to try and come up with some suggestions of their own to try and head off any governmental taxation.
Airlines have been in the firing line more than most industries since it is claimed they currently account for 3% of global carbon dioxide emissions and this is set to rise to around 6% by 2050 if the current fast growth rate of commercial air transport continues.
COMMENT: The momentum this report has already gained in publicity terms is unprecedented and the recent appointment of former US Presidential contender Al Gore as a reborn environmental consultant to the UK Government will only attract more focus, despite his famous gaffs.
To be fair, reducing carbon emissions has long been on the agenda of ACI and quite some progress has been made in retiring aircraft from service that are deemed environmentally unfriendly.
But the sheer growth of air travel at present and forecasts for more of the same over the next decade mean that the industry is definitely a high profile and easy target for politicians to be seen to be doing something, however small in the grand scale of reducing carbon emission levels.
Expect this issue to take on a much greater immediate significance to the travel retail business in future, because it is not going to go away.