The EU ETS and carbon market : success or failure and should Malta participate in this market

Abstract

For the past 150 years, society has been responsible for causing global warming by polluting the world's atmosphere with greenhouse gas emissions than any other known time period. As of a result, this brought forth the International Climate Change Legislation of 1997, better known as the Kyoto Protocol; a legally binding agreement to reduce emissions by 80% to 90% below 1990 levels by 2050, and later in 2005 the establishment of the first largest carbon market under the EU ETS policy. Since its inauguration, the EU ETS and carbon market have been under constant debate between those who support its initiative and consider it as the solution against climate change and those who claim it to be a failure of green economy and that another course of action should be sought, such as,taxation. The purpose of this research is to determine if the EU ETS and carbon market are the appropriate method of tackling climate change and whether Malta should participate in this market and possibly profit from it in the future, thereby, further enhancing itself as the Financial Centre of the Mediterranean. To achieve the aims of the study, a Qualitative approach was conducted using Grounded Theory and an Interview approach, where some of the answers sought in the latter were based on the context of the study and literature whilst conceding the interviewee the freedom to expand and discuss openly. The general findings have demonstrated similar views concurring on a general good perception of the EU ETS and carbon market, accordingly erasing any doubts that scientists, economists and many more have confuted and hence corroborating it to be a great opportunity for Malta's financial role.