It was the agreement that everyone wanted, yet that no one much likes. This year’s annual United Nations climate-change conference in Lima, Peru, finally concluded in the early hours of Sunday morning, more than 24 hours after the scheduled close, after fierce argument in the final days. Negotiators from 196 countries patched together a compromise that keeps the world on course to a new global climate agreement in Paris next year; but almost everyone was left unhappy with some provision or another.

Many critics of the deal, however, have missed the point. The Lima deal is weak in many respects. But it also represents a fundamental breakthrough for shaping a comprehensive global climate regime.

The Lima conference had two goals. The first was to adopt an outline of the text of the 2015 Paris agreement. This goal was achieved – but only by creating a huge 37-page document containing every possible option that countries may want to see in next year’s deal. Delegates did not attempt to negotiate between the various options, taking to heart the old maxim “Why do today what you can put off until tomorrow?”

That negotiation has been left to the five sessions of talks scheduled for 2015, starting in February. Given the divergence among the positions included in the Lima text, arriving at a draft fit for signing in Paris next December will be a huge task.

The second goal was to agree on the terms under which countries will devise their national commitments – officially, their “intended nationally determined contributions” (INDCs) – in 2015. Here, the compromises were sharply felt.
Developing countries wanted the INDCs to include plans for adaptation to climate change as well as emissions cuts, and they wanted developed countries to include financial support for poorer countries. Instead, no commitments to new money were made, and the inclusion of adaptation plans will be optional, not compulsory.

Meanwhile, developed countries wanted all countries to provide standardized information on their emissions targets and plans, to ensure transparency and comparability. The key elements were agreed on, but only in the form of guidance, not as requirements. Likewise, the proposal by the European Union and the United States that countries’ plans be subject to some kind of assessment was dropped from the final text.

But the aggregate effect of all countries’ plans will be calculated, allowing evaluation next year of whether the world has done enough to limit average global warming to the agreed ceiling of 2º Celsius. It almost certainly will have not.
For many of the agreement’s critics, particularly those in the environmental movement, these compromises made the Lima deal an excessively “bottom-up” agreement. Countries have too much latitude to make whatever commitments they want, relatively unconstrained by a common set of “top-down” rules imposed by the agreement. Such critics worry that this will make it harder to persuade countries to cut emissions further when it becomes clear that their collective efforts are not enough, and that it may even allow some countries to use irregular accounting methods.

But this overlooks the Lima agreement’s greatest accomplishment: It ends the longstanding division of the world into only two kinds of countries, developed and developing. Ever since the original UN Framework Convention on Climate Change was signed in 1992, countries’ obligations have been defined according to their level of development in that year. The rich so-called “Annex 1” countries have had compulsory obligations, while poorer “non-Annex 1” countries merely have been required to make voluntary efforts.

Over the last 22 years, that binary distinction has looked increasingly obsolete, as the larger developing countries, such as China and Brazil, have emerged as economic superpowers and major greenhouse-gas emitters. For this reason, the developed world has long wanted to replace the “firewall” between the two historic groupings with a form of differentiation that better reflects the contemporary world. But the developing countries – including major powers like China – have insisted that it remain.

No longer. The Lima agreement creates obligations for countries without regard for the distinction between Annex 1 and non-Annex 1. Rather, it uses a new phrase drawn from the recent agreement between the US and China: countries’ responsibilities will be based on “common but differentiated responsibilities and respective capabilities in light of different national circumstances.” The firewall has been breached.

In theory, the Lima agreement on INDCs does not determine the shape of the long-term Paris agreement. So another fierce battle on this issue can be expected next year. But the vast majority of developing countries – including China and Brazil – are happy with the new regime. So it is impossible to imagine the binary model being restored – and those countries that opposed the change know it, which is why the final two days in Lima were so fiercely fought.
The Lima conference has shown just how hard the negotiations in Paris next year will be, despite recent optimism about global progress. But one highly significant decision has now effectively been made. Abandoning the rigid distinction between developed and developing countries paves the way toward an agreement that all countries, including the US and China, can sign.

This article is published in collaboration with Project Syndicate. Publication does not imply endorsement of views by the World Economic Forum.

To keep up with Forum:Agenda subscribe to our weekly newsletter.

Author: Michael Jacobs is Visiting Professor at the Grantham Research Institute on Climate Change and the Environment at the London School of Economics. 

Image: Splinters of ice peel off from one of the sides of the Perito Moreno glacier in a process of a unexpected rupture during the southern hemisphere’s winter months, near the city of El Calafate in the Patagonian province of Santa Cruz, southern Argentina, July 7, 2008. REUTERS/Andres Forza.