Derailing the negotiation process in the Mexican resort town, the world's two biggest emitters of greenhouse gases have been locked in a conflict over transparency when it comes to carbon dioxide reductions under the Copenhagen Accord. The non-binding declaration was patched together at the end of the failed U.N. conference in Denmark last year.
Washington wants to introduce outside monitoring of the voluntary reduction pledges into a process called Measurement, Reporting and Verification. The United States is concerned that the likes of India and China don't live up to their commitments. Backed by several other emerging economies, Beijing said it won't open up to foreign control. This seemingly minor conflict has been simmering since Copenhagen and it could lead the negotiations into disaster, observers say.
A second unresolved conflict concerns the Kyoto Protocol, a climate protection treaty that runs out in 2012. It binds rich nations to emissions reductions but doesn't affect the United States, which hasn't ratified it, nor China, classified as a developing country. Japan and other rich countries want a new treaty that binds all the major emitters. Poor nations want Kyoto to survive.
Delegates are becoming increasingly frustrated with the United States, which has threatened to block progress on issues such as deforestation and adaptation if the transparency issue isn't resolved.
They claim Washington has little clout demanding action from emerging countries given America's massive per-capita emissions and its domestic political inaction: Neither has Washington ratified Kyoto nor has it passed, as for example the European Union has, policies with binding greenhouse gas emissions reductions. The climate bill, despite strong support from U.S. President Barack Obama, crumbled in the U.S. Senate.
While China has boosted its national climate protection efforts and invests massively in renewables, its economy, along with its emission levels, is rising so fast that it's clear the world's largest exporter will have to change.
While the summit is to end Friday, talks are expected to last well into the weekend in a bid to increase chances that any sort of agreement materializes. If Cancun fails, the U.N. process will be questioned, with nations likely to pursue other venues for climate protection.
This could result in "a sort of zombie conference, where there won't actually be anybody able to be at a senior enough level to take any serious decisions at all," Britain's Energy and Climate Change Secretary Chris Huhne was quoted as saying by The Independent newspaper.
Observers have indicated that the EU, the only global player with binding commitments to CO2 reductions, could pair up with India and China in a multinational climate scheme. Such a move would increase pressure on the United States to follow suit.