The European Union has called for developing nations to make greater efforts in cutting their growing greenhouse gas emissions and wants these nations to rely much less on carbon offset schemes. Carbon offsets where developed nations effectively fund cuts in emissions in developing countries through investment in principly new technology has spawned a growing trade in carbon offsets that is now approaching globally hundreds of billions of dollars. However, these schemes have not prevented the growth of greenhouse gases in the developing world and there are critics that believe that carbon offsets will not help curtail greenhouse gas emissions while monitoring and enforcement of schemes is weak in the developing world. Developing countries have consistently rejected such limits, claiming they have a right to catch up to developing countries and in effect have the right to pollute. The Kyoto Protocol has allowed richer countries to meet binding targets on greenhouse gas using carbon offsets but critics has argued that offsets are another form of development aid. The EU has been the largest buyer of offsets and its trading scheme is the most advanced. Targets for greenhouse gas emissions have been set and all EU nations are now tasked to achieve them. Carbon offset schemes ate based on the principle of cap and trade which sets a limit on greenhouse gas emissions and allow participating countries and companies to trade emissions permits within that cap. Developing countries have consistently rejected such limits, claiming they have a right to catch up to developing countries and in effect have the right to pollute. The EU statement will put it at odds with the UN which has stood behind the developing world. The EU stance is likely to harden if there is not universal adoption of greenhouse gas limits and a system that can regulate carbon credits and this will eventually require caps to enforce the reduction of emissions in developing countries. Developing countries do need to do more as the evidence suggests that climate change will only increase poverty.