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Last Updated: Thursday, 30 September, 2004, 15:47 GMT 16:47 UK
Kyoto 'won't hit' Russian economy
Factory in northern Russia
Some fear Kyoto could hurt the Russian economy
Russian economic growth is unlikely to suffer because of government support for the Kyoto Protocol on climate change, a leading analyst has said.

Some economic advisers had warned that Russia could face economic crisis if it had to cut greenhouse gas emissions.

But Russia has to cut emissions from levels set at the height of Soviet output, Dafne Ter-Sakarian, of the Economist Intelligence Unit, said.

This makes it unlikely that Kyoto will hurt the economy in the short term.

Russia's economy shrank following the collapse of the Soviet Union in 1991.

Emissions targets

The Kyoto Protocol sets targets for greenhouse gas emissions, which many scientists believe cause global warming and climate change.

Industry is still very wasteful - it could be of concern, but not for the next five to 10 years
Dafne Ter-Sakarian, Economist Intelligence Unit

Under the Kyoto Protocol - established in 1997 - industrialised countries have committed to cut their combined emissions to 5% below 1990 levels by 2008 - 2012.

"The measurements were taken at the height of Soviet output, so there is a lot of slack. It's not going to affect growth in the short term," said Ms Ter-Sakarian, the Economist Intelligence Unit's senior Eastern European analyst.

"However, in the long term it could be different. Environmental regulations are not strict in Russia, and industry is still very wasteful. It could be of concern, but not for the next five to 10 years," she added.

Kyoto fears

Russia accounts for 17% of world emissions and President Vladimir Putin's government has now sent the Protocol to parliament - the Duma - for ratification.

Since the US - the world's biggest producer of greenhouse gases - pulled out three years ago, the treaty has been dependent on Russian ratification.

President Putin had earlier made his support for Kyoto known, but divisions had emerged among his aides, amid fears that it could hurt the country's economic growth.

The president's economic adviser, Andrei Illarionov, was reported by Russia's Interfax news agency as having described the government's backing of Kyoto as a "forced decision" which would "concern each of our citizens".

Business hopes

Russia's business leaders were sanguine about their prospects under Kyoto, Ms Ter-Sakarian said.

"It hasn't been the thing business people have been talking about. Business is interested in the World Trade Organisation (WTO) and the terms of Russia's accession," she told BBC NewsOnline.

If Russia finds it hard to reach its target of doubling GDP by 2010, it will be for reasons other than Kyoto, she said.

"The GDP target is not going be achieved for other reasons. Structural reform is proceeding slowly. State companies are very poorly managed, productivity is very low," said Ms Ter-Sakarian.

She added that government approval for Kyoto could be seen as "payback" for European Union support over Russia's accession to the WTO.




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