Mark Twain supposedly made the famous remark that everyone talks about the weather but nobody does anything about it. Some 20,000 participants gathered 13-24 November in the Dutch capital The Hague to understand how the human species may, inadvertently, be causing global climate change and how we might come to grips with its consequences. This Sixth Conference of Parties to the United Nations Framework Convention on Climate Change (COP-6) concluded unsuccessfully, with the Americans and the Europeans unable to agree on a plan of action to cut emissions of greenhouse gases (GHGs) that are largely blamed for global warming. The "G77 and China", as the countries of the South are collectively known, had very little say.

The global community reached a historic agreement on a Protocol for reducing atmospheric GHGs in December 1997 at Kyoto, Japan. The Kyoto Protocol contains emission reduction targets for each industrialised country to meet and a timetable for doing so. As a group, the industrialised "Annex I" countries, have agreed to reduce emissions by a total of 5.2 percent below 1990 levels within the first commitment period of 2008-12. Non-Annex I countries do not have binding obligations at present.

COP-6 was meant to resolve how much flexibility Annex I countries would be allowed in meeting their individual Kyoto targets without directly reducing their emissions, including setting rules on crediting countries for removing carbon from the atmosphere through planting trees (sinks). Other goals of the Conference were to agree on how to monitor countries' compliance with their commitments and to set up accounting methods for national emissions and emissions reductions. Agreement was also expected on the creation of an Adaptation Fund as well as capacity building and transfer of technology to help vulnerable developing countries cope with the adverse impacts of climate change. An agreement at The Hague would have gone a long way to readying the Kyoto Protocol for ratification by both Annex I and non-Annex I countries. At the end it was the flexibility that turned out to be the most contentious.

The Kyoto Protocol includes three "Kyoto Mechanisms" designed to allow Annex I countries considerable flexibility to supplement domestic actions to fulfil their reduction commitments:

Emissions Trading, that allows a country to trade reductions made beyond its commitment; Joint Implementation, where investors in one Annex I country can get credit for emissions reduced by a clean energy project in another; and, the Clean Development Mechanism (CDM) allowing for joint implementation of projects in non-Annex I developing countries. CDM projects have the additional requirement of also meeting sustainable development needs of the host country.

Going into COP-6, the United States favoured complete flexibility in the extent to which sinks and the Kyoto Mechanisms could be used to meet committed reduction targets in the interests of pursuing least-cost compliance options. The members of the European Union and many environmental groups, however, wanted strict limits on the use of sinks and Mechanisms so that countries would be forced to take substantial domestic action to reduce emissions. The main argument was that greater flexibility would allow for large loopholes and result in postponement of crucial investments needed to make renewable energy systems competitive with fossil fuels-the only realistic way global emissions can contract to 50 percent of current levels by the end of the century. The negotiations fell apart because the Americans and the Europeans were not able to sufficiently narrow the differences in their positions.

Even though Nepal is not a substantial contributor to climate change and may not suffer its worst immediate impacts, it is still very important for us to fully engage with the issues for a number of reasons. Every impact makes the already difficult task of sustainable development that much harder.

Agricultural productivity and forests are expected to decline in tropical and sub-tropical regions throughout the world as a result of global warming due to varying precipitation, pest outbreaks, and exacerbation of El Nino effects. This will negatively affect farmers both in the tarai and the middle hills of Nepal. Vector-borne infectious diseases, like malaria and encephalitis, will likely be more widespread and move north into the population centres of the middle hills. Accelerated melting of glaciers will result in increased frequency of Glacial Lake Outburst Floods (GLOFs), washing away roads, bridges, hydropower plants, and farms and settlements along glacier-fed rivers. Intense rainfall events are expected to be more frequent, increasing flood damage. While the expected 15-95 cm sea level rise by the end of the century will not directly affect Nepal, the pressures put on our neighbours will also result in stress on our borders. Bangladesh is expected to lose as much as 17 percent of its land to inundation by 2100 if it cannot build dikes-this translates to a loss of as much as half of its rice-growing areas.

Nepal needs to substantially increase its capability to adapt to the effects of climate change. We need to be able to forecast the weather, including El Nino effects, and inform our farmers better, manage floods more effectively, install systems to provide early warning of GLOFs, and strengthen public health.

Nepal can also attract investment into clean energy projects in the transportation, industrial, and domestic sectors by making use of the Clean Development Mechanisms. The country is naturally suited to use its own renewable sources like hydropower and solar energy to meet its energy needs in place of fossil fuels, like coal and petroleum that need to be imported and which cause serious local air pollution. However, even with the high petroleum prices today, it is still cheaper to drive cars and trucks than to run electric vehicles, trolley buses, ropeways, and electric trains powered by hydropower. It is cheaper to cook with kerosene and LPG than with electricity. By giving credit for the saved carbon to the investor, who can then use it towards meeting his country's Kyoto targets, the CDM encourages Annex I investment in Nepali projects that use clean energy even if they may be more capital expensive.

Developing countries, as a whole, were largely sidelined at COP-6. They remain concerned, however, that the richer countries have not left them sufficient 'environmental space' for their own future economic growth. Since it is expected that developing country emissions could surpass that of Annex I countries in as little as 10 years, it is clear that there will very soon have to be negotiations to reduce emissions beyond the first commitment period that will also include all countries. One suggestion, initially made by environmentalists from India 10 years ago, gained a lot of currency at COP-6 (not in the official plenary sessions but in the well-attended side events)-that future negotiations be based on the premise that every human should have equal entitlement to the environment. Countries would then be able to trade the portion of their entitlements that they did not use. The Kyoto negotiations in contrast started with countries' 1990 levels of emissions and negotiated reductions using that as a baseline.

It has recently been reported that the Americans and Europeans have worked to resolve their differences since The Hague and that an agreement might be hammered out before Christmas. If this happens, the Kyoto Protocol may indeed move fairly quickly towards ratification. Nepal needs to build up its ability to manage the impacts of climate change by participating in technology transfer and accessing the Adaptation Fund. It also needs to attract investments into clean energy and infrastructure projects under the CDM. In the interests of global equity, Nepal should support per capita entitlements as the basis for negotiating emission reductions in future commitment periods.

Bikash Pandey is an energy expert and director at Winrock-REPSO Nepal.