European Union (Approval of Treaty Amendment Decision) Bill [HL]

Lord Giddens Excerpts

Wednesday 23rd May 2012 Lords Chamber

[Lord Giddens]

My Lords, it is an honour to follow the noble Lord, Lord Lamont. I am not sure how much I agree with the main body of his speech but I certainly agree with what he said at the beginning. This is a crisis of gigantic proportions. Enough of precipices, I would say, but this is the greatest social and economic crisis we have lived through and it is unfolding against the backdrop of a world economic recession which is still far from unresolved. As I argued in a speech that I gave a couple of days ago, this adds to the difficulties we are confronting in Europe, which do not simply come from within Europe itself.

I support this Bill, but, I have to say, perforce. That is because this one-page scrap of green paper is Britain’s, and especially the Government’s, ambivalence towards the European Union made manifest. I argue that it represents a position that is now disintegrating and for which there is no long-term future. I would like to sketch in the reasons why.

In a document that the Government sent round after the report that we debated on the euro crisis, they say:

“The decision not to be part of the Fiscal Treaty does not reduce our influence and has not damaged our reputation in Europe”.

That statement is absurd. The noble Lord, Lord Lamont, seemed to say that it does not matter who listens to you. It surely does because if people stop listening to you, you have no influence in the circles that you want to influence.

[Lord Radice]

To act as the mouthpiece of the noble Lord, Lord Lamont, as I understood it in his criticism of me, he does not think that influence is important.

[Lord Giddens]

That is what I was saying. Influence is very important because if you do not have it, how are you going to affect the course of developments in Europe? I have been around Europe talking to a range of European figures recently, as my noble friend has been as well, and it is true that virtually nobody listens to what the Prime Minister says. This is important. Britain is now marginal in Europe because we lecture Europe from the sidelines, and I have heard so much of that in the debates over the past few days. The Prime Minister wants what all other European leaders want: the stabilising of the eurozone. Yet he will have no influence over that process.

One can say that the EU is at a crossroads—except that, as has been observed, the EU is always at a crossroads. This time, however, the forks of the crossroad are far further apart than ever before. On the one side, there is the possibility of the disintegration of the eurozone. Having looked at the scenarios in detail, I cannot see any which would not be catastrophic if this course were followed. Some have argued for what has been called a velvet divorce, whereby the eurozone could be progressively uncoupled. However, as in real life, there are very few velvet divorces and I could not see a scenario in which that could be achieved. Whatever one thinks of the eurozone—I have certainly had mixed feelings about the euro from the beginning—its disintegration would be catastrophic for Europe as a whole, and certainly for the UK as well.

There is only one other path. I think the path that Europe will certainly try to follow is a move towards federalism, and in a fairly strong sense of that term. Fiscal union is being forced on the eurozone, more or less, by the markets but it would have to go along with the ECB becoming a lender of last resort. We have a good understanding of the financial apparatus that it would presume, although we do not know whether there is enough money around to back it. These moves in turn would have to be accompanied by greater political co-ordination.

From these there follows the need for a process of democratisation and a reshaping of the institutions and procedures of the EU. Therefore, in thinking of the future of the EU and in charting, as I have been doing over the past three months, the enormous number of debates going on outside this country in the member states of the European Union, we are not talking about evolution. We are talking about a sort of revolution. We are talking about the end of the Monnet method of slow accumulation. We are talking about big transitions over a short period towards a more integrated eurozone that would, in the end, drag in most of the rest of the European Union. Jörg Asmussen, who is a German board member at the ECB and, incidentally, someone who has had a lot of influence over Angela Merkel, yesterday called for just such a programme. I think he gave his speech in anticipation of the meeting today. He argued that eurozone members should join in a,

“banking union, fiscal union and political union”.

Should the eurozone survive in a reasonably robust condition—and like the Government, I cannot see anything else that one can hope for—several other countries, such as Poland, have declared their intention to join it. At that point, British policy would surely have to change. There could be no more ambivalence, no more sitting on the fence and no more wanting the advantages of the EU without the commitments. Should, God forbid, the EU descend into chaos, the UK will be affected just as much as any country that has formally signed up to the euro. If a more federal Europe emerges, and I think that is the most likely outcome, Britain will no longer have the option of semi-detached membership. I think this also applies to the single market. I do not think that the idea that Britain can concentrate on the single market when the rest of Europe has moved to a much more tightly co-ordinated economy can work.

At that point, a momentous decision will have to be made: in or out. In my contribution to the debate on the Queen’s Speech I argued that at such a point there should be a referendum. I think this is the first time ever that there have been voices from all three major parties arguing for the desirability of a referendum. We would have to have a referendum if Europe has moved down a federal path and become a different entity far away from the position it was in when the UK entered it.

If a referendum is held, the results might surprise some of our more vociferous political commentators. I quote from a recent, very interesting study that I commend to anyone interested in opinion in Europe. It is by Michael Bruter and Sarah Harrison and is called How European Do You Feel? but it goes well beyond that. It is the largest study ever carried out across the 27 EU member countries about attitudes towards the European Union, reform and the future. The reason it is so important is that its methodology is far more sophisticated than the surveys that you read in the press from day to day. If you read the results of surveys in the papers of what people think of the European Union, they are sometimes based on a sample of only 200 or 300 people. They do not give you an in-depth understanding. This study uses a range of sophisticated techniques and goes up to 2012. I think noble Lords will agree that the results are quite counterintuitive. They show that European identity is strong across all 27 EU countries, with a majority in this country endorsing the statements about Europe in the study. Far from declining, in 2012, it is getting stronger. It has gone up from just under six out of 10 in their measures to over seven out of 10.

In the United Kingdom, there are some very interesting findings in the survey. Opinion is polarised, but intriguingly so. Younger people are far more positive about the European Union than the older generation. There is, the authors say, a new, younger generation of very committed Europeans in this country. In their conclusion, they say that in the UK there are,

“two publics, one fiercely non-European, and”—

this is important—

“one of the largest proportion of highly ‘Europeanised’ people in the whole of Europe”.

I would welcome the Minister’s comments on any aspects of what I have said, particularly on what plans the Government are making to respond to what is likely to be a quite different Europe from the one in which we have existed in such an ambivalent way until now.

[Lord Lawson of Blaby]

My Lords, it is always a great pleasure to follow the noble Lord, Lord Giddens, as I have done on a number of occasions both inside and outside this House. I will refer to one of the important things he said when I reach the logical point in my own contribution. However, I do say now that he should not confuse being European with accepting everything that the European Union does—or, indeed, the existence of the European Union itself. As many noble Lords on both sides of the House know, my main home is in France. I certainly consider myself a European, but, as noble Lords will discover, I will be critical of what is being put before us today.

[Lord Giddens]

If the noble Lord checks the survey, he will find that it contained a whole range of questions, such as whether respondents agreed with EU policy on Schengen—and more than 90% do. It contained a whole set of questions on actual EU policies, not just on EU identity.

[Lord Lawson of Blaby]

If 90% of people say that they agree with some particular European convention, that is probably a lie. I doubt whether 90% of people know about any European convention.

To come back to the Bill that we are debating, a few days ago an item appeared on the Foreign Office website which read:

“Foreign Office Minister introduces EU Treaty Amendment Bill to the House of Lords … Foreign Office Minister Lord Howell said … ‘A stable and healthy eurozone is important for the UK’s long-term growth and prosperity. This treaty change is firmly in the UK’s national interest’”.

That is the basis for the Bill before us. I have the greatest affection for my noble friend Lord Howell. Indeed, I can hardly blame him for saying that, because it is government policy. But it is, of course, complete nonsense. It is not a stable and healthy eurozone that is important for the UK’s long-term growth and prosperity; it is a stable and healthy European economy which is important for the UK’s long-term growth and prosperity. So long as the eurozone staggers on, we will not have a healthy European economy. That is the problem that we face.

Greece has been mentioned. It has a number of special economic difficulties and also a special political difficulty. Greece is, and always has been, a “phavlocracy”. I owe this term, which is little used, to when I was editor of the Spectator, 45 years ago. I recruited an excellent Athens correspondent, because the colonels had just come in, and he explained that “phavlocracy”—a word the Greeks use—meant “government by corruption”. The high economic cost of that is an additional problem but we are not debating a Greek problem. This is a fundamental problem of the eurozone project. It is not the tired old argument of growth versus austerity, as if somehow you can say, “Let’s have some growth, what a good idea”. It is the particular problem of the eurozone that we need to address.

The European Monetary Union was fundamentally flawed right from the start. It was predictable and indeed it was predicted. I think I was the first Minister to point this out in a speech at Chatham House in January 1989. I analysed the eurozone project and I concluded in these terms. It is a long quotation but it is important to put on record what I said at the time, well before the eurozone came into being. It was a few days before publication of the Delors report on which European monetary union was based, but we all knew what would be in it. As Chancellor of the Exchequer at that time, I concluded in these words:

“Nor would individual countries be able to retain responsibility for fiscal policy. With a single European monetary policy there would need to be central control over the size of budget deficits and, particularly, over their financing. New European institutions would be required, to determine overall Community fiscal policy and agree the distribution of deficits between individual Member States.

The setting up of a European Central Bank or a new European institution to determine Community fiscal policies go to the very heart of nationhood. What organisation would really be the government? It is clear that Economic and Monetary Union implies nothing less than European Government—albeit a federal one—and political union: the United States of Europe. That is simply not on the agenda now, nor will it be for the foreseeable future”.

That is what I said as Chancellor of the Exchequer in January 1989. I elaborated on a number of further occasions, both in speeches and in articles, during the interim period until 1999 when it came into being. Then I gave up. I was seeking to persuade our European friends and partners not to make the huge mistake of going down this hugely damaging route. Once they had done it, I had failed and I gave up.

I was not the only one. My friend Hans Tietmeyer, when he was president of the Bundesbank in 1996, in the more measured terms that central bank governors are inclined to speak, said:

“Monetary union means a restriction on national sovereignty, on national manoeuvring room and the ability to go it alone. Participants lose the instrument of exchange rate adjustment … In a monetary union, countries have to tackle and solve their economic problems and challenges in a similar way and with similar speed. If the countries decide fundamentally different answers, then great problems will arise”.

He could say that again.

So why did this happen when everybody who was informed knew that this was fundamentally flawed? It happened because this was not economic at all; it was entirely political. There were of course some innocent worshippers at the church of Europe who believed that anything that was more Europe must ipso facto be a good thing. But most of the promoters were more sophisticated. Their objective, and they were clear about it, was full-blooded political union—a United States of Europe. That was the view of Jacques Delors and most of those who supported him. They thought that since monetary union and political union have to go together, if you want political union then you have the monetary union and it will inevitably lead to the political union which is the objective. That is a fundamental misreading of history; it is the wrong way around.

The example of Germany in the 19th century is interesting. German unification came in three stages. First, there was the zollverein, the customs union. Then Bismarck and Prussia forged a political union from blood and iron. It was only after they had political union that they had monetary union. That was the sequence. Doing it the other way around simply does not work.

One reason why you must have political union is that, as we all know, there must be transfers from the German taxpayers to the poor Greeks or whoever. However, you cannot make that work—nor does it have credibility—if it is on a sporadic and discretionary basis. You must have a single system of taxation, as there is in any currency union, such as the United Kingdom, which takes more money from the wealthier sections of the economy; and a single system of spending so that there is more spending on, say, social security in the poorer parts of the economy. The transfers become automatic and there is no discretion.

You must also have control of deficits. This simply means that you must have a single Finance Minister at the head of a single finance ministry in a single Government. That is the only way that it can work. Even then, it would, in my judgment, be economically harmful to the European Union. To use the economists’ jargon, which the noble Lord, Lord Giddens, enjoys so much, it would be suboptimal.

There is a great literature about what is known as an optimum currency area. No one quite knows what an optimum currency area is. We all know that you do not get individual cities with their own currency but, equally, you do not have a world currency. That is too big and the first is too small. Where is it right? I think all economists would agree, as would the noble Lord, Lord Giddens—even though he is not an economist, he follows these things—that an area as big as the European Union, with its great size and diversity, is not an optimum currency area. In particular, to help the transfers and so on to work you need wage flexibility, which the United States has but Europe does not. Indeed, it is anathema to the European social model, which is opposed to wage flexibility.

Above all, you need labour mobility. That is what happens in the United States. If one area is not doing too well, people move to another area. However, what do you have in Europe? For cultural and linguistic reasons, when there is 25% unemployment in Spain—indeed, 50% youth unemployment—but little more than 5% in Germany, the Spanish do not move to Germany. They riot in Madrid and call on their Government to do something to help them.

EU: Recent Developments

Lord Giddens Excerpts

Thursday 16th February 2012 Lords Chamber

[Lord Giddens]

My Lords, noble Lords will forgive me if this point has been made but it is very odd that of 39 speakers only two are noble Baronesses. I do not know whether there is something about the European project that is specifically male but, if there is, it perhaps explains part of its failure to appeal to large sectors of the electorate.

In my contribution I want to ask, and attempt to answer, a simple question: where will the jobs come from in the future in European Union countries? Like all simple questions, it is fiendishly difficult to answer. It is not quite up there with, “What is the nature of reality?”; nevertheless, at this point in time it is a crucial issue for the European Union. Once you examine it forensically rather than superficially, it proves to be an extremely difficult issue, but I should like to do my bit in trying to think it through. To do so, we have to retrace somewhat the origins of the current crisis. Everybody knows that this crisis stems from the famous flaws in the construction of the euro and from what happened in global financial markets. It is important to recognise that second point: many traders acted on the assumption that sovereign debt would always be repaid, and we know that this is much more iffy now than was thought at the time.

However, there is a second strand to the current crisis in European Union countries that has not been examined as much as the crisis in the euro itself, and that is the failure of the Lisbon agenda. Noble Lords will not need reminding that the Lisbon agenda was supposed to make the European economies the most competitive economies in the world by the year 2010, a claim which looks somewhat ironic in light of the happenings today. The Lisbon agenda was supposed to apply to all EU countries but it was actually a crucial part of the eurozone project because the Lisbon agenda was supposed to produce convergence between the very different economies which were part of the eurozone project.

From the beginning, convergence was seen as a key part of the eurozone project. Instead of producing convergence, we had divergence especially between the northern and the southern countries. Baldly put, those countries which reformed were mainly the northern countries; they became successful within the confines of the euro. Those countries that did not reform, but simply borrowed, now experience the sort of epicentre of the crisis that we see.

It is obvious that austerity programmes will not bring about growth in and of themselves and that they will not reinstate high levels of employment. Therefore, how can competitiveness be restored in EU economies? I would like to offer a few points about that. First, some aspects of the Lisbon agenda remain relevant. One example is the insider-outsider labour markets, as economists call them, which are particularly pronounced in countries such as Italy, Spain and Greece. The persistence of such strongly protected labour markets is one of the main reasons why youth unemployment is so high in those countries; it is notably very high in all three. However, I do not think that any of the provisions found in EU forward planning at the moment are sufficiently innovative to answer the question which I posed. The Lisbon agenda is not powerful enough; it is not innovative enough; and it is not relevant enough to the contemporary world.

Secondly, the same is true of Europe 2020, which is supposedly the main kind of planning vehicle for job creation in the European Union. It is a kind of road map, but to my mind not an effective one, and nor, I am afraid, is completing the single market. That can make a contribution, but it is nowhere near enough to reinstate the level of job creation that we need in EU countries if we are to compete effectively in what is a very different world from even 10 years ago. I argue that we need a huge effort of imagination on a policy level and on an intellectual level, and we need to rethink some of the existing nostrums that we have about economic growth and job creation.

Thirdly, I argue that, although the European economies will remain service economies, we have to look at reviving manufacture. Looking at Euro 2020, and at existing European plans, we see how inadequate they are. Most of the plans for the revival of manufacturing in the European economies are based on the idea that Europe can develop high-tech economies which can keep European countries ahead of Asian competition. If you look at a concrete example, you can show that this model is quite flawed. An illustration of that would be German pre-eminence in solar technology. The Germans were leading the world in solar technology and in the production of solar panels until relatively recently, but then China entered the market, the price of solar panels fell dramatically and German industry was simply undercut by that process. Therefore, it is not clear that we will be able to preserve a cutting edge that will rejuvenate manufacturing.

For this reason, we in Europe should take seriously the debate that is going on in the US about reshoring. This is the opposite of offshoring; it is the drawing back of industries from countries to which they have been lost. This is one of many examples that I would look to for innovative thinking. As a practising social scientist, one principle I have always applied is that a current trend will always at some point turn into its opposite. There is a cogent argument for this in respect of offshoring, and American economists have done a lot of recent work on it. Why is it happening? Wage rates are rising in Chinese manufacturing centres; real wages in the United States and in EU countries are falling; the price of oil looks set to stay high because of potential disruptions to the global supply chain; and there are problems sustaining patents in countries that do not have effective legal systems.

The Boston Consulting Group in the US has done an intensive study of American industries and recognises something like nine industrial clusters where there are already signs of manufacture returning to the US economy. The clusters are not the ones that one would predict. For example, they include furniture manufacture and other mundane branches of industry. I offer this not as a solution to the question of where jobs will come from but as an example of the need to use our imagination and think differently from the ways in which we have thought until now.

A rethinking of the processes of job creation and competitiveness in EU economies should be part of a root-and-branch rethinking of the European project. I admire the noble Lord, Lord Willoughby de Broke, as a tennis player and fellow member of the parliamentary tennis team. I do not completely agree with his view of the European Union. I am pro-European, and believe that by coming together, countries have more power in a fractured, globalised world than they could possibly have individually. However, pro-Europeans should recognise that the critics make very important points, and we should rethink the European project in relation to them. The European Union is too slow-moving and bureaucratic. It simultaneously lacks leadership, capacity and democratic participation. If we pro-Europeans cannot address these fundamental shortcomings, Europe may become what many people fear: a theme park for affluent Chinese tourists. This is surely a vision to avoid.

Turkey

Lord Giddens Excerpts

Thursday 13th January 2011 Lords Chamber

[Lord Giddens]

My Lords, Turkey is Turkey.

I join the long queue of noble Lords in congratulating the noble Baroness, Lady Hussein-Ece, on having initiated this debate, and the somewhat shorter queue of noble Lords congratulating the noble Lord, Lord Sharkey, on his truly excellent maiden speech.

I shall concentrate my comments on the thorny issue of Turkey's potential accession to the EU. As so many other noble Lords have already talked on that topic, I will try to zoom in well below my six minutes. I should declare an interest as a former member of the Ahtisaari commission on the EU and Turkey and pay tribute to the work of my colleagues on the commission, which has deservedly been very influential.

At first sight, the quest for Turkey to join the EU seems like “Mission Impossible”. That is how many people on both sides have come to see it. I am pleased to see from this debate that that view is not shared by Members of your Lordships' House; nor is it shared by me. The problems in the way are well known and have been alluded to by other noble Lords. First, there is the stuttering nature of the accession process, with many chapters of the acquis being frozen. Secondly, there is the hostile attitudes of some of Europe's key leaders, who have been alluded to in the debate. Thirdly, there is the seemingly intractable issue of Cyprus, for which the EU must accept a high percentage of blame, having allowed Cyprus to enter the EU before a constitutional settlement was reached. Fourthly, there is the consequent cooling of public opinion on both sides. A survey in 2008 showed that only 28 per cent of EU citizens were in favour of Turkey joining the EU, down from 44 per cent a couple of years earlier. A poll in Turkey in 2010 showed that only 38 per cent of the population supported entry into the EU, down from 73 per cent in 2004.

The end of a dream, then? Like other noble Lords, I do not think so. The structural ties that bind the EU and Turkey are very strong. Consider what might happen if the EU and Turkey continued to drift apart. As other noble Lords have said, Europe would be defining itself as a Christian community, not the cosmopolitan body which in fact it is, as millions of Muslims are already part of the Union. Turkey might enter into alliance with authoritarian states, possibly succumbing to rising Islamic radicalism. A prosperous, democratic and secular Turkey is in everyone's interests.

The vicious circle that exists can be broken, but it is obvious that creative thinking will be needed at this point. I make three quick remarks on that. Cyprus, as other noble Lords have mentioned, remains a prime sticking point, but there are a lot of interesting ideas around. I mention in particular the 11-point plan proposed by the International Crisis Group, which is a promising way forward. Secondly—again, as others have noted—the pace of reform in Turkey needs to be stepped up again following the so-called golden era of transformation in 2000 to 2005, but it is worth recognising that the AKP has made more progress with the Kurdish problem than any previous Government.

Thirdly, the EU is itself in crisis, as we know, and its future is opaque. However, that situation should encourage experimentation. I agree with those who say that the EU should work with Turkey outside the framework of the accession process and that foreign policy and energy security are two key areas where it is obvious that that could be successful. I do not think that that would compromise the acquis; it would strengthen it. The case of Nabucco has already been mentioned.

I therefore join other noble Lords and the British Government in strongly endorsing the case for keeping Turkey on track for membership of the European Union.

EU: Defence Pact with Russia

Lord Giddens Excerpts

Thursday 18th November 2010 Lords Chamber

Asked By

[Lord Giddens]

To ask Her Majesty’s Government what is their assessment of a possible defence pact between the European Union and Russia.

[The Minister of State, Foreign and Commonwealth Office (Lord Howell of Guildford)]

My Lords, Her Majesty’s Government believe that increased engagement between the EU and Russia is a positive development. There are several strands of discussion on developing and enhancing security and stability in the Euro-Atlantic area, including in the Organisation for Security and Co-operation in Europe—the OSCE—and the NATO-Russia Council. There is, however, no proposal for an actual defence pact between the EU and Russia, and we do not consider such a pact either desirable or likely.

[Lord Giddens]

I thank the Minister for that Answer and for the positive note that he struck—at least, at the beginning. Does he agree that collaboration to contain international terrorism could be one basis for future further collaboration between the EU and Russia?

[Lord Howell of Guildford]

Yes, I certainly do. I think that these issues will come up at the NATO summit, which is beginning on Friday, and indeed we look forward at that summit to the possibility—indeed, the probability—of a text that will reflect a new era of co-operation and engagement between the whole of NATO and Russia. Therefore, the problem that the noble Lord has referred to is very relevant and it will be at the centre of our discussions.

Latin America

Lord Giddens Excerpts

Thursday 24th June 2010 Lords Chamber

[Lord Giddens]

My Lords, I join the queue of other noble Lords in congratulating the noble Viscount, Lord Montgomery, on instigating this debate and on all the work that he does to improve the relationship between the UK and Latin America. I especially congratulate my noble friend Lord Liddle on his wonderful maiden speech, demonstrating such intellectual power and coverage. He does not hang around, as he has only been formally inducted into your Lordships’ House for three days. Perhaps I may say, given his impetuous nature, “Why did you wait so long?”.

I have known and worked with my noble friend for many years and I can vouch for his collegiality and for the power of his intellect. He has enormous in-depth knowledge of British politics and of the European Union—qualities on display in his maiden speech—having served in the European Trade Commission and having been for some years adviser on the European Union to the former Prime Minister Tony Blair. He has also written widely in those areas. He will be a marvellous addition to your Lordships’ House, and I hope that your Lordships will join me in offering him a very warm welcome.

I shall talk about climate change policy in Latin America with especial reference to Brazil. Climate change poses massive threats to the Latin American subcontinent. To take one example, rapid tropical glacier retreat is observed in the Andes, with enormous implications for future water supply for the countries affected. Brazil is a front-line country for climate change. Even in the short term, it faces significant adverse changes in its ecosystems. As the right reverend Prelate rightly observed and discussed in a most interesting way, it is home to much of the Amazon basin, one of the world’s greatest natural resources, but one under threat should periods of prolonged drought become more common—and they seem to be becoming more common, especially given the big drought of about four years ago. Deforestation in the Amazon is a major source of humanly created carbon emissions.

Brazil is an extremely interesting country in terms of climate change policy. It has quite a different energy profile from most other countries—not only in the developing but in the developed world. Forty per cent of its energy, and twice that proportion of its electricity—more than 80 per cent—come from renewable sources. Virtually no other country in the world has a profile like that. It famously launched an ethanol programme in 1975 as a response to worries about energy security. More than half the cars in the country are flexi-fuel—they can run on 100 per cent ethanol or petrol, or a mixture of the two. The use of biomass for energy production, involving wood pulp and other sources, is highly advanced in Brazil. It therefore has a very interesting and almost unique energy profile.

President Lula introduced a comprehensive national climate change programme earlier this year. It was an ambitious set of policies. It marks the first time that a large developing country has set itself stringent carbon reduction targets, although they are voluntary rather than legally binding. The stated target is to cut emissions by between 36 per cent and 38 per cent by 2020, which propels the country right to the vanguard in world society. It is a target beyond that offered, for example, by the European Union. Crucially, Brazil’s mitigation activities will be quantifiable and verifiable, making them open to international scrutiny—something that the other large developing countries, India and China, have so far not put into practice.

Brazil therefore has the opportunity dramatically to influence international negotiations on carbon reduction. It was one of the five countries that made up the so-called BASIC group that created the Copenhagen accord following the conference in Copenhagen last December. The others were the United States, China, India and South Africa. The large developing countries are often seen as blocking effective international policy on the control of carbon emissions, but Brazil shows otherwise.

The success of the country in meeting its targets will depend significantly on how far it can effectively tackle land use and deforestation. These count for the large bulk of its greenhouse gas emissions. Brazil has a distinctly patchy record in this respect, but there are signs of progress. The country is involved in a number of bilateral relations with other states in which deforestation is a vital issue, such as in Indonesia. It has also signed up to a climate policy dialogue with the United States.

Hillary Clinton’s interesting speech in Quito earlier this month marked a significant shift in the United States’s policies towards Latin America. She spoke of creating what she called a community of the Americas. It is entirely appropriate that a climate change strategy should be a key part of this new approach, and in such a dialogue the US has at least as much to learn from Brazil as the other way around.