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Should there be a climate agreement at COP21?

Martin Bureau | AFP | Getty Images

Since last week, representatives from 195 countries have gathered in Paris to negotiate a deal to reduce carbon emissions and minimize the impact of global warming at the 21st Conference of Parties summit, or "COP21".

The World Meteorological Organization said in November 2015 is going to be the hottest year on record. Next year could be hotter still due to the El Nino weather patterns.

The underlying cause of warmer temperatures is the high percentage of carbon dioxide (CO2) emissions into the atmosphere, brought by excessive burning of fossil fuels, according to the U.S. Environmental Protection Agency.

Fossil fuels are derived from the fossils of once living organisms and include coal, oil, and natural gas - which are major sources of energy.

China and the United States account for almost half of the world's CO2 emissions.

According to Bank of America Merrill Lynch, climate change and the carbon-intensive economy are "causing unprecedented damage to financial stability via physical, liability and transition risks" as well as "up to 5 [million] deaths a year."

The bank said in a note that weather-related losses have hit $4 trillion over the past 30 years and have averaged $200 billion per annum in the last decade.

"Without action, the global mean cost of climate change could rise to 1-5 [percent] of GDP/year - with emerging markets and the poor to be hit hardest," the bank wrote, adding global investment portfolios could lose up to 45 percent of their value by 2020.

One of the sticking points in reaching a deal at COP21 is bringing developing nations such as India, where a significant portion of its population still live without access to electricity, to the negotiating table.

Indian Prime Minister Narendra Modi said prosperous nations should take the initiative for carbon emission reduction and allow developing nations room for growth.

Last week Simon Baptist, regional director for Asia at the Economist Intelligence Unit, told CNBC's "Street Signs Asia" that it is unlikely that a treaty will be reached at the end of this week.

"Even if people did sign up to an internationally binding agreement, those things aren't actually binding and countries can just leave them as Canada did, if they want to, halfway through," he said. "Or they can just not sign up, as the U.S. never did."

Baptist added to address climate change, countries have to adopt policies that are in their own interest and will be a lot more effective than an international agreement as it incentivizes governments to adhere to them.

As the talks in Paris continue, for this week's Trader Poll, tell us why there should be a climate agreement.

-- CNBC's Jenny Cosgrave contributed to this report.

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