This year is the year for global action, says the World Economic Forum (WEF). If politicians, the private sector and international organisations fail to act on climate change and sustainable development in 2015, the opportunity to create low-carbon growth and reduce poverty will be lost. This was the message from world leaders, delivered at the 45th WEF Annual Meeting in Davos-Klosters.
Davos, Switzerland, the venue for the 45th WEF Annual Meeting (photo courtesy WEF)
The world is at a critical crossroads. The third International Conference on Financing for Development in Addis Ababa next July is expected to result in a new roadmap to support sustainable development. The UN Summit in New York in September will adopt the post-2015 development agenda and the Sustainable Development Goals. In Paris in December, 196 countries will meet to agree on a new climate change agreement.
“With these (events) we can set our life and world on course for a better future,” said Ban Ki-moon, Secretary-General, United Nations, New York. “I am very encouraged. The climate summit last September has created new political momentum. It was a far-reaching leadership decision to cut greenhouse gas emissions by 20 per cent by 2040.”
Ki-moon noted that sustainable development and climate change are “two sides of one coin” – climate action will also contribute to the Sustainable Development Goals, agreed to by world leaders at the Rio+20 UN Conference on Sustainable Development in 2012. However, success will depend on growth, which is associated with pollution and more emissions.
“Growth must be more inclusive and green,” he said. “By 2030 the world will make a massive investment in infrastructure, cities and agriculture. If this spending is directed towards low-carbon growth, we will be on our way to climate-resilient societies.”
The UN Secretary-General reminded participants that leadership is needed if growth and infrastructure are to be considered together. “I urge you to choose wisely and to invest in the low-carbon pathway,” he said.
Jim Yong Kim, President, The World Bank, Washington DC; Co-Chair of the World Economic Forum Annual Meeting 2015, said it is important to get the maths right. “With an aggressive move towards clean transport and greater energy efficiency policies, we could [boost] the global economy by up to $1.8 trillion to $2.6 trillion per year,” he said.
Yong Kim noted that it is important to get the incentives right. “We have to include the private sector in a way that we have never done before. We need to make growth robust [and make it] have an effect on poverty,” he said.
Many developing countries are “leapfrogging” with new technologies to combat climate change, said Paul Kagame, President of Rwanda. He described simple initiatives, such as reducing deforestation by providing cooking stoves and involving women and young people in climate change and sustainable development. “You have to begin at home in terms of land management and use of resources,” he said. “It is important to involve everybody. As we look forward to development, we are not making a choice between environment and prosperity; we are trying to combine both.”
Energy subsidies have wide-ranging negative consequences on growth, sustainable development and climate change. A. Michael Spence, William R Berkley Professor in Economics and Business, NYU Stern School of Business, Italy, said it is a “catastrophic policy” that produces distorted economies. Subsidies for producers and consumers come at a high cost. Fortunately, Spence noted, they are in the process of disappearing.
“We have a choice between an energy-efficient, low-carbon path or an energy-intensive, high-carbon path that will end catastrophically,” he said.
“The good news is that you don’t pay much of a price in terms of growth by getting on the energy-efficient, low-carbon growth path.” However, it will take a great deal of “commitment and creativity” to get there, he added.
Paul Polman, Chief Executive Officer, Unilever, United Kingdom, urged business leaders to pursue growth and job creation, but to make it sustainable. “Translate commitment into action in your companies,” he said. “We have an opportunity to show politicians that there are solutions and that they are better from an economic and sustainable point of view. We are talking about a new moral framework. Do you want to be the one that misses this opportunity?”
More than 2,500 participants are taking part at the 45th World Economic Forum Annual Meeting in Davos-Klosters, Switzerland from January 21 to 24, 2015.
Click here for UN Secretary-General Ban Ki-Moon's thoughts ahead of the session.
Report courtesy World Economic Forum