October 20, 2007—Developing countries are on track to become, eventually, the biggest contributors to global warming and climate change, but they won’t modify their rapidly growing carbon appetite unless developed nations show more will in curbing their own.
That was one of the major themes of a seminar “Low Carbon, High Hopes: Making Climate Action Work for Development” held Friday, October 19, during the Annual Meetings of the World Bank Group and the International Monetary Fund.
The seminar brought together four panelists representing major forces in the international movement to stop or at least slow down climate change, which, many scientists say, could cause major, irreversible damage to the planet by the second half of the century. The burning of fossil fuels, agriculture, and deforestation have been identified as the chief man-made causes of climate change.
The seminar speakers were Heidemarie Wieczorek-Zeul, the German Minister for Economic Cooperation and Development; Yvo de Boer, Executive Secretary of the UN Framework Convention on Climate Change; Valli Moosa, President of the World Conservation Union, and Jon Williams, Head of Group Sustainable Development for HSBC Holding, a worldwide banking and financial services organization.
‘Without Movement by the U.S., It’s Not Going to Happen’
Citing the growing force of the Group of 77 – the largest bloc of developing nations in the UN – Moosa said: “Let’s not hold up some kind of irrational hope that the G77 is going to move quickly toward new [climate change] targets without meaningful movement of the U.S…. It’s not going to happen.”
De Boer said “we’re at a critical moment in time to make investment decisions” regarding the estimated US$20 trillion that the world’s economies are projected to spend on energy between now and 2030. The issue, he said, is whether that spending will result in 50 percent more greenhouse gas emissions – the scenario without major mitigation of greenhouse gases – or 50 percent less.
The UN’s Intergovernmental Panel on Climate Change – co-winner of the 2007 Nobel Peace Prize with Al Gore – says emissions must be cut by 50 percent by 2050 to avoid disastrous levels of climate change.
De Boer said the UN Climate Change Conference to be held in Bali, Indonesia, in December will be all-important for establishing a timetable on the specifics of what needs to be done to hit the “50 minus” emission targets. Both developed and developing nations will be represented at the Bali conference, but pressure will be on the U.S. and other Western countries to take the lead in mitigation.
‘Why Wouldn’t We Want to Make Money Out of This?’
Banker Williams said huge spending on energy – driven by growth in the developing as well as developed countries – presents huge opportunities for investors. Speaking of his own bank, which has 10,000 offices in 83 countries, “Why wouldn’t we want to make some money out of this?”
Williams said that between now and 2020 an estimated 270 billion euros will be spent on wind power, 300 billion euros on solar, 123 billion euros on biofuels and 120 billion euros on energy efficiency. “Why wouldn’t we want to have a few billion in those assets?” he said.
Minister Wieczorek-Zeul, who has been a major force in initiatives by the European Union to mitigate greenhouse gas emissions produced by its member countries, said her advisers have warned that climate change will become “the most immediate security risk in this century.”
She said the World Bank “has to become much more courageous” in tackling climate change issues. “That is one of the major tasks of the World Bank.”
She and other panelists applauded the World Bank Group for action it’s taken against climate change, which include committing US$1.4 billion in 2007 to support renewable energy and energy efficiency on 63 projects in 32 countries. The spending was a 67 percent increase above the previous year.
Panelists Agree Mitigation Would Have Small Impact
Wieczorek-Zeul sits on the Development Committee of the World Bank Group and IMF, which builds inter-governmental consensus on major development issues, and is part of the Annual Meetings in Washington.
While mitigation of greenhouse gases – which have been identified as the major cause of climate change – would require billions of dollars annually in new investments, all the panelists agreed the cost would be a small fraction of the world’s gross domestic product. The IPCC estimates that stabilizing greenhouse gas emissions at an acceptable level would reduce the world’s GDP by anywhere from 1 to 3 percent, depending on the stringency of controls.
In summing up his comments, De Boer seemed to be speaking for all the panelists when he said:
“There are three critical mistakes we could make. The first is to assume that climate change is an environmental issue that economists can afford to ignore. The second is to assume that established funds and throwing money at the problem is enough to solve it. The third is to assume that a climate friendly future could be built without looking at tax and investment policies in developing countries.”