1. Graciela Chichilnisky Columbia University May 8 2008

2.  A global market mechanism must create economic incentives for Sustainable Development  ‘Price signals’ and market solutions  Encouraging human activity that creates wealth and welfare  And is harmonious with the environment

3.  A Successful Global Market Mechanism: The ‘Carbon Market’ of the Kyoto Protocol

4. ◦ Carbon Price signal - rewards carbon reduction & penalizes excessive emissions ◦ Self funded - requires no donations to execute ◦ Reduces the gap between the poor and the rich nations – the Global Divide (Article IV of 1992 Climate Convention) ◦ In 2006 CDM executed $9 billion in transfers for productive investment in developing nations reducing 30% EU annual emissions

5. A successful Global Market Mechanism must satisfy these four operating principles: ◦ 1. Foster Sustainable development ◦ 2. Be Self funded - requires no donations to execute ◦ 3. Reduce the gap between the poor and the rich nations – the Global Divide ◦ 4. Transfer productive resources to lowest income communities

6.  Aggregates the services of large numbers of watersheds across the world, bundled into one global financial asset: global watershed services  Public-Private corporation owns rights to watershed services with strict covenants. Sells bonds and equity to be self funded  Public - Private corporation owns and profits from the savings created by using ecosystem services rather than artificial plants to capture and filtrate water destined to cities >1 million population  Corporation, land & resources owned by local communities  Covenants to restrict and manage residential, commercial and agricultural use of watersheds  Financial asset (bonds, equity of corporation) sold in the global capital markets – Water Hedge Funds – IPOs and secondary markets.

7.  Aggregates the services of large numbers of forests across the world, bundled into one global financial asset: global prospecting services  Public-Private corporation owns rights to forest biodiversity services with strict covenants. Sells bonds and equity to be self funded  Public - Private corporation owns and profits from bio prospecting services (Costa Rica’s example)  Corporation, land & resources owned by local communities  Covenants to restrict and manage residential, commercial and agricultural use of forests  Financial asset (bonds, equity of corporation) sold in the global capital markets – Forest Hedge Funds – IPOs and secondary markets.

8.  Digital Data Base to avoid permanent loss of verbally transmitted indigenous knowledge  Indigenous knowledge threatened by the segmentation of traditional communities & encroachment of industrial societies.  Data Base records original source & ensures licensing revenues  Replacing patents by compulsory licenses  Knowledge owned by the originating sources – Public Private Corporation sells knowledge services to private sector.  Medicinal knowledge alone represents $100 billion in annual sales for pharmaceutical companies  Data base development encourages digital training and job creation for indigenous youngsters, mentored by communities elders  Bonds and Shares in Public - Private corporation are sold in global capital markets, IPOs.  Knowledge owned by communities, Public – Private corporation owns rights to sell services from indigenous knowledge.

9.  Creation of property rights for the global spectrum  Owned by each nation within its territory  Create Private-Public corporation(s) to exploit the services of the global spectrum  Owned as appropriate by local communities, with bonds and shares sold in global capital markets  Developing nations (e.g. Latin America) are the largest expansion market for wireless services in the world today

10.  Chichilnisky, G: Development and Global Finance: the case for an International Bank for Environmental Settlements UNDP and UNESCO, New York 1996, in ww.chichilnisky.com - publications