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New Zealand has a distinct opportunity to carve out a leadership position in climate change and establish itself as the centre for carbon trading in the Asia Pacific region, according to a report presented to the Prime Minister, Minister of Finance and Minister for Climate Change Issues and Energy today by the Carbon Market Working Group.
However, carbon trading globally is moving ahead apace, with the support of governments and private sector participants across market sectors. If New Zealand does not act soon to establish a market here, we will relinquish that opportunity to Australia or an Asian market.
CEOs from companies as diverse as Air New Zealand, 42 Below, Fonterra, McKinsey, Infratil, the New Zealand Institute, the New Zealand Rugby Union and PricewaterhouseCoopers, energy companies Vector, Meridian and Contact, brokers ABN AMRO and Goldman Sachs JBWere, and a number of government agency observers, joined forces in December 2006 to evaluate the feasibility of establishing the carbon market for the Asia Pacific region in New Zealand.
Their enquiry determined that New Zealand is a natural owner for a carbon market, due to this country's international clean, green image, the integrity and relative flexibility of our markets, our access to technology, and our status as a signatory to the Kyoto Protocol.
“We all share a commitment to New Zealand as a place to do business, and a determination to see New Zealand gaining from the clusters of productivity and expertise that will grow around this market,” said Air New Zealand CEO and Carbon Market Working Group member Rob Fyfe.
The Working Group asserts that New Zealand can be a leader in carbon trading, which is fast shaping up to be the new international currency, and has proven its capacity to overcome issues of scale and distance to be a leader in a number of fields, especially those that rely on state-of-the-art technology for their success.
“ New Zealand can and should be the centre for carbon trading in the Asia Pacific region. If we sit back and wait for other countries to seize the initiative, we will lose the opportunity forever to attract an international pool of liquidity, and all the associated economic benefits that derive from healthy markets,” said NZX CEO and Carbon Market Working Group member Mark Weldon.
Work will now focus on the capital structure and operations of the New Zealand carbon market, with a view to commencing operations in 2008.
“The window will only remain open for a very short time. We've done our homework. This is big, it's tangible and we can do it,” said Weldon.
NOTE: The Working Group expressly excluded from its terms of reference both the science of climate change and any debate around the optimum design of a climate change policy framework in New Zealand.
