NEW YORK/BEIJING/ADDIS ABABA/OSLO/JOHANNESBURG: Rapid technology innovation and infrastructure investment means governments and businesses now don't have to choose between economic growth or carbon reduction.
A new report released today from the Global Commission on the Economy and Climate (GCEC), says US$90 trillion will be invested in infrastructure in the world's cities, agriculture and energy systems by 2030. As a result it says the world has an "unprecedented opportunity" to drive investment in low-carbon growth, bringing multiple benefits including jobs, health, business productivity and quality of life.
The report is the result of a year-long study by leading research institutes from Brazil, China, Ethiopia, India, South Korea, the U.K and U.S., advised by a panel of leading economists chaired by Nicholas Stern.
Former president of Mexico and GCEC chairman Felipe Calderón said the report debunks the idea that the world must choose between fighting climate change or growing the world's economy.
"Today's report details compelling evidence on how technological change is driving new opportunities to improve growth, create jobs, boost company profits and spur economic development. The report sends a clear message to government and private sector leaders: we can improve the economy and tackle climate change at the same time."
The commission calculates that if its recommendations are fully implemented the world could achieve up to 90 percent of an emissions reduction target needed to avoid dangerous climate change. The report has been published just one week before the UN Climate Summit in New York.
"The decisions we make now will determine the future of our economy and our climate," said Stern, who is co-chairman of the GCEC. "If we choose low-carbon investment we can generate strong, high-quality growth – not just in the future, but now. But if we continue down the high-carbon route, climate change will bring severe risks to long-term prosperity."
The report finds that building better connected cities based on mass public transport can save over US$3 trillion in investment costs by 2030. At the same time restoring just 12 percent of the world's degraded lands can feed another 200 million people and raise farmers' incomes by $40 billion a year.
With over half of new electricity generation over the next 15 years likely to be from renewable energy, phasing out the US$600 billion currently spent on subsidies for fossil fuels (compared to $100 billion on renewable energy) will help to improve energy efficiency and make funds available for poverty reduction says the GCEC.
"Major companies, smart investors and a new generation of entrepreneurs are already demonstrating how markets can drive low-carbon growth," said Jeremy Oppenheim, global programme director of the New Climate Economy project. "But inconsistent policy in many countries is now creating uncertainty, hurting investment and job creation. Businesses and investors need clearer market signals."
According to Caio Koch-Weser, vice chairman of Deutsche Bank: "The financial sector has a major leadership and business opportunity to accelerate environmentally and socially responsible investments which boost income and spread wealth."
The GCEC was established by Colombia, Ethiopia, Indonesia, Norway, South Korea, Sweden and the U.K. as an independent initiative to examine how countries can achieve economic growth while dealing with the risks posed by climate change.