Ending fuel subsidies can help climate fight, says UN

Scrapping subsidies on fossil fuels could cut global greenhouse-gas emissions by 6% and benefit the world economy, Reuters reported a United Nations report as saying.

Fuel subsidies account for 0.7% of world gross domestic product, the report said. If they were abolished, the world economy would be boosted 0.1%, the UN Environment Programme (UNEP) report estimated.

Subsidies are biggest in Russia, it said, where energy subsidies amount to nearly US$40 billion each year. Iran, China, Saudi Arabia, India, Indonesia, Ukraine and Egypt also each have fuel subsidies of over US$10 billion, the report added.

The study, published during a 160-nation UN climate meeting in Ghana, said that even though subsidies on oil, gas or coal are designed to help the poor, they usually benefit the wealthy more than poor people.

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