Subsidy WatchIssue 36, February 2010

a lone chair sits on the beach; in the background, a storm gathers over the sea; three strikes of lightening hit the ocean

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  • A storm brews over UK offshore wind subsidies

    On 8 January, the Crown Estate, the body which manages Britain's sovereign lands, announced the names of the companies who have successfully bid for the right to build giant offshore wind farms in nine zones established around the UK. The farms will be large enough to generate 32.2 gigawatts (GW) of electricity per year and are intended to meet to meet 25 per cent of the country's electricity needs by 2020.

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Also in this issue:

Analysis

  • China agrees to eliminate ‘famous brand’ subsidies to end WTO dispute

    The People's Republic of China has agreed to end dozens of controversial subsidies under its World Top Brand, Famous Export Brand and China Name Brand programs that the United States claimed were supporting Chinese exports of a variety of goods, ranging from electronic appliances to apparel and agricultural products.

    The agreement reached between China and the United States was announced on 18 December by U.S. Trade Representative Ron Kirk and appears to put an end to one of several disputes between the two countries at the World Trade Organization (WTO).

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Commentary

  • Forget subsidies: just give me cash

    By Hafiz Noor Shams

    In spite of opposition that saw the streets of Kuala Lumpur filled with pro-fuel subsidy groups during the Abdullah administration, efforts to liberalize Malaysia's fuel subsidy regime have gone a long way. Several arguments, including one that criticizes the untargeted and blanket nature of the policy, have gained tremendous traction. The fact that it benefits those who do not need or deserve the subsidy is clearly one of the main motivators behind the reform of the policy, the other big drivers probably being cost and the waste of revenues that could be spent elsewhere.

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News

  • Fossil-fuel subsidies round-up: January 2010

    Following announcements that fossil-fuel subsidies will be phased out by the G-20, the Asian-Pacific Economic Cooperation (APEC) and a number of independent countries, including Iran, Nigeria and Bahrain, Subsidy Watch will be highlighting the most interesting news stories that touch on this theme each month...

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  • India struggles to cap subsidy budget

    The Indian government is reportedly considering the partial reform of fertilizer subsidies in an effort to reign back its fiscal deficit. According to The Times of India, the proposal is thought to be relatively low-risk, as many farmers in India still use urea to fertilize their crops.

    Government officials have stated they do not expect the change to reduce India's subsidy burden significantly - rather, the aim is to prevent it from increasing. India's announcement that it will try to cap its subsidies to state-run fuel retailers can be seen in the same light.

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Studies

  • Earth Policy Institute reveals food-cost of U.S. biofuels policy

    On 21 January, the Earth Policy Institute published a data highlight on their website about the impact of United States biofuels production on world food supplies. Originally part of the larger work, Plan B 4.0: Mobilizing to Save Civilization, which stresses more generally the importance of acting to ensure world food supplies, the analysis starkly illustrates the cost of U.S. biofuels in terms of foregone food.

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  • German Federal Environment Agency analyses environmentally harmful subsidies

    This month, Germany's Federal Environment Agency has published an English translation of Environmentally Harmful Subsidies in Germany, a 2008 report that had previously only been available in German.

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  • GTZ's International Fuel Prices 2009 – Full Edition now available

    The German Technical Cooperation (GTZ) has announced the release of the full edition of International Fuel Prices 2009.

    The report provides an overview of the retail prices of gasoline and diesel in more than 170 countries, discusses pricing policies, presents case studies on the impact of high and volatile fuel prices in 2007 to 2008 in developing countries and provides access to numerous additional resources.

    The full document is 114 pages, with over 450 graphs and figures.

    It is available for free download on www.gtz.de/fuelprices

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