EU pledges billions for post-Kyoto climate deal

European Commissioner for Environment Stavros Dimas addresses a news conference on EU climate and energy policy at the EC headquarters in Brussels May 29, 2009.

BRUSSELS (Reuters) - Europe could pay poor countries up to 15 billion euros ($22 billion) a year by 2020 to persuade them to help battle climate change, the European Union's executive arm said on Thursday.

Developing countries say industrialized nations should shoulder most of the cost of tackling a problem they caused in the first place, creating a stumbling block in negotiations ahead of a climate meeting in Copenhagen in December.

Africa has warned it will veto any deal that is not generous enough, and the 27-country European Union is trying to calculate a fair payment to break the deadlock.

"Now we must break the impasse in the Copenhagen negotiations," EU Environment Commissioner Stavros Dimas told reporters. "We know climate change forces additional costs on developing countries."

Dimas' team of experts estimates the developing world will face costs of around 100 billion euros a year by 2020 to cut emissions from industry and to help deal with droughts and crop failures worsened by climate change.

Taxes on global shipping, aviation and industry could help, leaving a gap of 22-55 billion euros to be filled from the public purse. The EU could contribute 2-15 billion euros of that, the Commission said.

But environmentalists said the figure was too low.

"The EU is trying to get away with leaving a tip rather than paying its share of the bill to protect the planet's climate," Greenpeace campaigner Joris den Blanken said.

DELICATE BALANCE

The United States might pay the equivalent of 13.3 billion euros a year, according to the same formula, and Japan up to 4.5 billion, EU calculations show.

Dimas said he was paying careful attention to the EU's poorer states, some of whom argue they have citizens just as poor as in the developing world.

Romania's GDP per capita, for example, is roughly the same as that of Beijing.

"Of course there are voices in the EU saying we should do more, but there are also voices saying this is too much money at a time of economic crisis," he said.

Swedish environment minister Andreas Carlgren, who will play a leading role in the negotiations, told Reuters he had no fears the funding pledge would be whittled down by European leaders.

The Commission had previously indicated the EU might pay as much as 24 billion euros, but retracted the number after slashing billions off its budget for paying for emissions cuts in poor countries.

Local businesses should finance their own energy-saving measures because such investments can ultimately pay for themselves, it argued in a recent internal policy document.

Oxfam International warned that much of the climate funding would simply be drained from existing pledges of overseas aid.

"This would rob tomorrow's hospitals and schools in developing countries to pay for them to tackle climate change today," said Oxfam campaigner Elise Ford.

But Dimas rejected the charge. "This will not come at the expense of official development assistance," he said.

(Editing by Dale Hudson and James Jukwey)