The decision by China and the United States to jointly ratify the Paris Agreement on climate change on the eve of the Chinese-hosted G20 Leaders Summit earlier this month, was simply great news. It is a huge signal from the world’s two largest economies that the low-carbon transition is not just environmentally necessary, but now lies at the heart of their future prosperity. The news out of China is even bigger than meets the eye.
SAVING our planet from the worst effects of climate change won’t be cheap. A new report from the United Nations says that the world will need to mobilize $90 trillion in public and private capital over the next 15 years. As a point of comparison, global gross domestic product in 2015 was $73 trillion. But there is no question that the world needs to ramp up its transition to a low-carbon, environmentally sustainable and resilient economy, and to do so rapidly. The question is, how do we pay for it, given the limited availability of government funding, particularly in developing countries?
With cities and societies nowadays seeking high quality life tinged with efficient delivery of public services and infrastructure, they also want environmentally and economically efficient mass transit systems. The World Economic Forum estimates that to meet the needs of a growing world population $6.9 trillion in investment is required. In addition, to this, $3.2 trillion will be required to green those investments to keep within a maximum 2 degrees Celcius temperature rise. Across the world, a quiet revolution is underway in public policy and private institutional innovations for a more sustainable global financial system.
Los líderes del G20 reunidos bajo presidencia china en Hangzhou han discutido, entre otras cosas, qué medidas habría que tomar para que el sistema financiero sea capaz de facilitar un desarrollo que sea sostenible. No se trata de un dato baladí: por un lado, la implicación de este foro es imprescindible para una tarea que requiere coordinar importantísimos cambios que no han hecho sino comenzar; y, por otro, el hecho de que sea China quien haya de dar un nuevo impulso al debate sobre las finanzas verdes de forma permanente puede marcar el inicio de una nueva etapa en el sistema financiero global. Un primer paso lo constituye el compromiso de los ministros de Finanzas y gobernadores de bancos centrales de tomar medidas para aumentar el peso del componente verde en las finanzas y la propuesta de medidas que lo acompañan.
by Erik Solheim
The global economy is in transition. Anywhere you look in the world, you can see this. From private companies embracing clean technology and clean energy, to countries putting sustainable growth at the center of national planning, the drive is toward inclusivity and the green - both are urgently needed. Such changes have been heralded both by the Paris Agreement on climate change and the adoption of the United Nation's 2030 Agenda for Sustainable Development last year. These are superb ambitions and the right direction for our future.
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