Black market CFCs

Apparently, much of the contraband CFCs both in the United States and Europe emanate from production facilities in China and Russia. The World Bank has launched a special program targeted at ending CFC production at Russian facilities, and the Russian government has recently instituted an export licensing system for CFCs to help control illicit shipments [15] [16]. The situation appears to be more problematic in China, which can still legally produce CFCs for consumption in the developing world. As it now stands, China is apparently the biggest source of material for the CFC black market in developed countries [17].

Even more troubling than black market trade in developed nations is an unexpectedly rapid rise in the use of CFCs and other ozone-depleting chemicals in some developing nations. The Montreal Protocol permits increases in production and use of ozone-depleting chemicals in developing nations until 1999, when production levels are to be frozen at 1995-97 levels; thereafter, production of ozone-destroying chemicals must be cut progressively until it ends in 2010. However, from 1986-95, production of CFCs rose nearly 2.5 times in the developing world, while consumption rose nearly 40 percent [18]. Most of this growth has taken place in a few rapidly industrializing nations: Brazil, India, Mexico, and particularly China. For example, China increased its production of halons – typically used as fire retardants – from 4,000 metric tons in 1991 to more than 10,000 metric tons in 1995 [19]. (See Backsliding: halon production is rising again.) This increase is particularly worrisome because halons destroy 3 to 10 times more ozone than CFCs and were specifically targeted for early phaseout (1994) in developed countries. Recent measurements show that concentrations of halons continue to rise in the atmosphere, offsetting some of the progress attained through declining CFC use [20].

Backsliding: Halon Production is Rising Again

Annual production of halons, 1986-95

Source: Sebastian Oberthür, Production and Consumption of Ozone-Depleting Substances, 1986-1995 (Deutsche Gesellschaft Für Technische Zusammenarbeit, Bonn, Germany, 1997), p. 30.

Note: Ozone-depleting potential (ODP) tons is a measure by which ozone-depleting substances are weighted according to their ability to destroy ozone.

The international community has already directed considerable attention to helping developing countries switch from CFCs before they become too dependent on them. The Multilateral Fund, which was set up under the Montreal Protocol to help pay for new technologies, equipment conversion projects, and training in developing nations, has so far contributed to some 1,800 separate projects in 106 countries at a cost of US$565 million. When complete, these projects will phase out the equivalent of more than 80,000 metric tons of CFCs [21]. A typical example is Venezuela’s Plasticos Molanca plastic foam factory, which used Multilateral Fund money to pay for 80 percent of its conversion from the use of CFCs to butane as a foam-blowing agent [22]. Similar projects, aided by strong government commitment and substantial private investment, have allowed some developing nations to proceed quickly toward total phaseout.

A variety of actions on the part of both industrialized and developing countries could help complete the move away from ozone-destroying substances. Tackling the black market will require better tracking of trade in CFCs. Recognizing this need, the nations that signed the Montreal Protocol recently amended the treaty to establish a licensing system for all CFC exports and imports. Making this licensing system work, however, will require concerted efforts on the part of those nations that actively trade these substances. These efforts will require better training of customs agents, closer interagency and international collaboration to detect and follow up on illegal activity, and stricter penalties for those caught trafficking in black market CFCs.

Developed nations can help the developing world by continuing to aggressively fund conversion projects through the Multilateral Fund. The United Nations Environment Programme (UNEP) estimates that the US$466 million that developed countries have agreed to add to the fund over the next several years should be sufficient to allow developing nations to meet the 1999 deadline to freeze production levels of ozone-destroying chemicals [23]. But additional funds, as well as increased transfer of CFC-free technologies, will be needed in the years after 2000 to complete the phaseout [24].

Other steps could hasten the healing of the ozone layer. Developed nations could encourage faster phaseout of their own remaining CFC use by requiring retirement or retrofit of CFC-using machinery. In addition, more rapid elimination of halon production in the developing world and the destruction of some or all of the existing halon stocks still in industrialized countries would significantly lower ozone loss [25].

References and notes

15. Op. cit. 10.

16. Op. cit. 13.

17. Op. cit. 10.

18. Op. cit. 1, pp. vi, 35.

19. United Nations Environment Programme (UNEP), Plan for Halon Phaseout in China, Working paper submitted to the Executive Committee of the Multilateral Fund for the Implementation of the Montreal Protocol 20th meeting, Montreal, Canada, October 16-18, 1996, p. 8, Table 1-1.

20. J. Butler, S. Montzka, and J. Lobert, “Growth and Distribution of Halons in the Atmosphere,” Journal of Geophysical Research: Atmospheres, Vol. 103, No. 1 (1998), p. 1503.

21. Sheng Shuo Lang, Deputy Chief Officer, Multilateral Fund for the Implementation of the Montreal Protocol, Montreal, Canada, February 1997 (personal communication).

22. United Nations Environment Programme (UNEP), OzonAction Programme, “Plasticos Molanca: A Multilateral Fund Phaseout Project,” OzonAction, Special Supplement No. 3 (UNEP, Nairobi, 1995), p. 9.

23. Op. cit. 21.

24. United Nations Environment Programme (UNEP), June 1996 Report of the Technology and Economic Assessment Panel of the Montreal Protocol on Substances That Deplete the Ozone Layer (UNEP, Nairobi, 1996), pp. 17-19.

25. United Nations Environment Programme (UNEP), Report of the Ninth Meeting of the Parties to the Montreal Protocol on Substances That Deplete the Ozone Layer (UNEP, Nairobi, 1995), Item 21.