The Kyoto Protocol

Global warming has become one of the most complicated problems the world faces. It can cause major changes in nature, ecosystems or social systems. In this case, industrialized countries decided to cooperate to solve this serious problem. The "Kyoto Protocol" is an international agreement on the United Nations Framework Convention on Climate Change. The goal is to reduce the emissions of carbon dioxide and other five greenhouse gases by countries that have ratified the agreement, or to do emissions trading when achieving or maintaining the targets set by each country.

The Kyoto Protocol sets out legally binding targets and schedules to reduce greenhouse gas emissions from developed countries that have ratified the Kyoto Protocol. Therefore, from an economic or market perspective, it is necessary to distinguish between a compulsory market and a voluntary market. A typical feature of both markets is trading with emissions certificates. Countries that do not fulfill Kyoto's emission reduction obligation can purchase CER and ERU to participate in emissions trading and compensate for the shortfall in the treaty. The national and national groups can also develop a local emission reduction plan that imposes mandatory carbon emissions targets on entities within the border. If institutional rules permit, mandatory entities can purchase CERs and ERUs through emissions trading in order to compensate for all or part of the reduced gaps.

Respecting the emission targets of the Kyoto Protocol is a great price for Canada. But how much is economic cost? According to the Canadian Chamber of Commerce and Industry, by 2010, the implementation of the Kyoto Protocol will cost approximately $ 30 billion, equivalent to 5% of Canada's GDP (Montreal Economic Research Institute). The Liberal Party Cabinet estimated in 2002 that unemployment of 200,000 people and a 5% reduction in Canada's GDP are inevitable (Böhringer). By the 2050's, Canada's climate change cost could increase from $ 5 billion a year in 2020 to $ 43 billion a year from $ 21 billion a year (National Environmental and Economic Roundtable). This cost depends on several factors, including global emissions increase, Canadian economy and population increase. However, the global slowdown that leads to a reduction in climate change will reduce the long-term cost of Canada