Towards a Global Market-Based Measure for the Aviation Industry

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Abstract

The aviation industry is vital for economic growth, world trade, and is a major employer. Nearly $2.4 trillion in global GDP, 35% of world trade by value and 58.1 million jobs are supported by the industry. However, with these benefits comes an impact on the environment. In 2013, aviation produced 705 million tonnes of carbon dioxide, approximately 2% of anthropogenic CO2-emissions. With air traffic projected to grow by 4-5% per annum in the coming decades, this raises the question of how sustainable growth can be achieved in the aviation sector and the need for regulatory measures. In 2013 the International Civil Aviation Organization (ICAO) adopted a Resolution in which it was decided to develop a global market-based measure (MBM). From 2020 onwards this measure - a global levy, global emissions trading, or global mandatory offsetting - would regulate carbon dioxide emissions from international aviation. However whether the measure will in fact be implemented depends for a large share on ICAO’s next General Assembly in 2016, where the 191 Member States will vote on adopting the measure. Their decision will greatly depend upon whether the global market-based measure matches their interests and agenda. Therefore the design of the global MBM is crucial in ensuring adoption and implementation. In order to reach political consensus by 2016, this thesis has focused on how a robust global market-based measure can be designed by showing the design process to arrive at the robust global market-based measure, and applying this design process. The following four principles of robust design were defined: (i) legal feasibility, (ii) political viability, (iii) purposefulness, and (iv) sturdiness.