Research On Resource Rent Extraction From The CDM Projects

With the harm of global warming growing on, the whole world are getting together in acceleration on solving the climate issues. In Dec.1992, the was adopted, which mainly comprise three develop mechanism:IET, JI and CDM. Among these three mechanism, CDM is the most closely related to the developing countries, it aims to help the developed countries fulfill their commitment of emission reduction at lower cost, and promote the sustainable development of the developing countries. As the primary goal of investors is profit maximization, the majority of the CDM projects are of low cost and low sustainability (LCLS) ones at present. While the high sustainable ones take a very small proportion, which is harm to the sustainable development in developing countries. Meanwhile, it reduces the opportunities for developing countries to achieve the sustainable development by their low cost advantage. As the largest host country of CDM project, China is facing more sever problems. To solve these problems, we can impose resource rents to raise the cost of LCLS CDM projects and promote the development of high sustainability ones. The essay analyzes the current status of CDM development which caused by the profit maximization motion of investors, concludes that we can balance the development of various types of CDM project by imposing resource rents with a type-by-type scheme. The essay also estimates the specific situation of China's CDM development, points out the defects of tax regulation on CDM projects, then rectify and improve them to get proper policy for balanced development of different types of CDM projects, which will improve the sustainability of CDM projects in order to fulfill the objective of sustainable development.