Countries should impose windfall taxes on fossil fuel companies and divert the money to vulnerable nations suffering worsening losses from the climate crisis, the United Nations secretary general has urged.
António Guterres said that “polluters must pay” for the escalating damage caused by heatwaves, floods, drought and other climate impacts, and demanded that it is “high time to put fossil fuel producers, investors and enablers on notice.”
“Today, I am calling on all developed economies to tax the windfall profits of fossil fuel companies,” Guterres said in a speech to the UN general assembly on Tuesday. “Those funds should be re-directed in two ways – to countries suffering loss and damage caused by the climate crisis and to people struggling with rising food and energy prices.”
Guterres’s appeal came in his most urgent, and bleakest, speech to date on the state of the planet, and the will of governments to change course.
His first words were: “Our world is in big trouble.”
“Let’s have no illusions. We are in rough seas. A winter of global discontent is on the horizon, a cost-of-living crisis is raging, trust is crumbling, inequalities are exploding and our planet is burning,” he told the assembly. “We have a duty to act and yet we are gridlocked in colossal global dysfunction. The international community is not ready or willing to tackle the big dramatic challenges of our age.”
The lacerating speech, delivered at the UN headquarters in New York, echoes calls from activists, and the European Union, to tax major oil and gas firms currently enjoying record profits in the wake of Russia’s invasion of Ukraine. In July, Exxon announced it had made a record quarterly profit of $17.8bn, while Chevron unveiled its own three-month record profit, of $11.6bn. BP, meanwhile, made a $8.5bn profit in the same period.
Under Guterres’s proposal, revenue from the taxes would flow to predominately developing countries suffering “loss and damage” from global heating, to be invested in early warning systems, mopping up from disasters and other initiatives to build resilience. Vulnerable countries are poised to leverage the UN general assembly week to ask rich nations for a “climate-related and justice-based” global tax to pay for loss and damage.
Guterres has previously accused governments of having an “addiction” to fossil fuels and has called new investments in oil, coal and gas “moral and economic madness”.
But his speech on Tuesday was particularly pointed, delivered on the grand dais of the general assembly and following the secretary general’s recent visit to Pakistan, where floods from what he called “a monsoon on steroids” have submerged a third of the country and displaced millions of people.
“Our planet is burning”, Guterres said, calling on world leaders to to end their “suicidal war against nature”.
“The climate crisis is the defining issue of our time,” he added. “It must be the first priority of every government and multilateral organization. And yet climate action is being put on the back burner – despite overwhelming public support around the world.”
“We have a rendezvous with climate disaster … The hottest summers of today may be the coolest summers of tomorrow. Once-in-a-lifetime climate shocks may soon become once-a-year events. And with every climate disaster, we know that women and girls are the most affected. The climate crisis is a case study in moral and economic injustice.”
Governments must stage an “intervention” to break their addiction to fossil fuels, Guterres said, by targeting not only the extractive companies themselves but the entire infrastructure of businesses that support them.
“That includes the banks, private equity, asset managers and other financial institutions that continue to invest and underwrite carbon pollution,” said the secretary general.
“And it includes the massive public relations machine raking in billions to shield the fossil fuel industry from scrutiny. Just as they did for the tobacco industry decades before, lobbyists and spin doctors have spewed harmful misinformation. Fossil fuel interests need to spend less time averting a PR disaster – and more time averting a planetary one.”
Guterres said it is “high time to move beyond endless discussions” and deliver finance for vulnerable countries and for wealthy nations to double adaption funding by 2025, as they promised to do at UN climate talks in Scotland last year. A further round of talks, known as Cop27, will take place in Egypt in November, in which loss and damage is set to be a central issue.
Although governments have agreed to restrain global heating to 1.5C above pre-industrial times, almost every country is lagging in their efforts to cut greenhouse gas emissions quickly enough to avoid this level of heating and therefore avert catastrophic climate impacts.
Emissions have already rebounded to pre-pandemic levels and an analysis this week showed there are plenty of known fossil fuel reserves in the world still left to burn – enough to unleash 3.5tn tons of greenhouse gases, which would smash the carbon budget before we get to 1.5C seven times over.