Economic growth and the green transition are not contradictory – with the right incentives they can enhance each other.
Climate change is both a consequence of and a multiplier of social inequality and instability – 40 % of the world’s conflicts are climate-related.
The green transition demands cooperation at many levels – both developed and developing countries are responsible, and finance from the private sector as well as the public sector is needed.
Over the past 30 years, the EU’s GDP has increased by almost 60 %. In the same period, its CO2 emissions have decreased by a quarter. This suggests there is no contradiction between economic growth and tackling climate change.
Agencies working in the developing world have similar experiences. In Madagascar, the French Development Agency has worked with vanilla producers to ensure sustainable use of forests and fair working standards. Vanilla farmers have found they can charge a higher price for a product certified as sustainable.
Meanwhile, Nigerian NGO Wecyclers is working with the poorest in society to get rid of their waste by unlocking the value of plastics. Rather than preaching about the environment, Wecyclers has found a solution by enabling poor people to sell their waste to recycling companies.
The Swedish International Development Agency (SIDA) is embracing a “Just Transition approach by linking climate-positive policies to its work fighting social inequality. In Africa, SIDA is helping countries transform their public transport systems from dirty, diesel minivans to electric buses. This means fewer jobs for drivers, so SIDA is providing vocational training to help them find new work.
The impacts of climate change are both a consequence of and a multiplier of social inequality and instability. Weather-related disasters hit the poorest hardest, displacing populations and provoking competition for scarce resources. Up to 40 % of violent conflicts around the world today have their origin in climate-related events. Hurricane Matthew caused a lot of damage in the Caribbean and Florida but hardly any loss of life. By contrast, the storm killed over 1,000 people in Haiti and caused massive damage to critical infrastructure. Why? Extreme inequality drives Haiti’s poor to cut down their trees for fuel, increasing the risk of devastating landslides during hurricanes.
The opposite is also true – less social inequality and poverty can combat the effects of climate change. If you can afford a concrete house and home insurance instead of an uninsured tin shack, you will be far more resilient in the face of disaster. There is a global dimension to inequality and climate change, eloquently put by Young Leader Val Amiel Vestil. ‘The least wealthy countries like the Philippines are the most vulnerable, but the wealthiest countries are the most responsible for climate change. If that doesn’t spell inequality, I don’t know what will,’ he said.
It will not be possible to reach the climate goals the world set itself in Paris without working multilaterally. ‘It’s blindingly obvious that you cannot address climate change on your own,’ said Christian Leffler, Deputy Secretary-General for Economic and Global Issues, European External Action Service. Developed countries have to look hard at their own records. Since 1990, the UK’s CO2 emissions have gone down 50 % but emissions generated to produce the UK’s imports have gone up by the same amount.
‘We will not reach our climate goals by focusing only on the poor countries of the world,’ said Carin Jämtin, Director-General of SIDA, adding. ‘We need to focus on ourselves at the same time.’ Governments and development banks have a role to lead the way for private finance to follow. SIDA has organised 17 institutional investors – pension funds, banks, insurers – to work together to invest in climate change adaptation and mitigation measures. The Development Bank of Southern Africa is supporting entrepreneurs and community-based businesses that are focusing on the green transition.
‘The moment you create the proper incentive, people’s mindsets change and they become the engine for the solution’, said Olawale Adebiyi, Chief Executive Officer, Wecyclers, Nigeria.