Global Climate Collaboration Needed More Than Ever, Davos Leader says (Caixin)
While the pandemic and geopolitical conflicts are adding headwinds to global cooperation, they also provide a reminder of how the world is intertwined and needs to work together more than ever, the head of the World Economic Forum’s climate action taskforce said in an interview. The effects of the pandemic and the war in Ukraine on rising food prices and supply chain disruptions have highlighted the world’s interdependence, said Gim Huay Neo, managing director of the WEF’s Center for Nature and Climate. There is no choice but to work with each other and to harness each other's strengths and capabilities to respond to a common challenge, Neo said in an interview with Caixin ahead of the organization’s 2022 meeting in Davos, Switzerland. “We will be as strong as the weakest link,” said Neo, a former executive of the Singapore state-owned investment company Temasek. She now leads the WEF’s initiative to accelerate climate action and environmental sustainability. The WEF will hold a rare springtime version of its annual gathering at the Swiss ski resort Davos this month after organizers postponed the meeting from its traditional January slot due to virus concerns. More than 2,000 business executives, political leaders and experts are expected to gather for the event after a two-year hiatus due to the Covid-19 pandemic. Lots will be on this year’s agenda as the world struggles to get back on its feet after the pandemic while the war in Ukraine brings new uncertainties and risks. Participants are expected to hold discussions on global cooperation, economic rebalancing, climate change and industrial transformation, among other topics. In a much more complex and volatile environment, challenges facing businesses and governments are no longer how to manage continuity but how to better manage disruptions, Neo said. How countries can push forward energy transition while staying focused on the long-term climate goals of net zero carbon emissions, and how to build a more resilient food system and more sustainable supply chains are expected to be the hottest topics, she said. While global crises pose immediate challenges such as rising prices of food and energy as well as global growth disruptions, governments need to find pathways that will allow them to stay the course of the long-term ambition, said Neo. Actions against climate change are at the top of those long-term commitments and are becoming increasingly urgent. A recent report warned that the likelihood of crossing a key global warming threshold has risen significantly. Global average temperatures now have a 50-50 chance of temporarily rising above 1.5 degrees Celsius compared with pre-industrial levels within five years, according to the World Meteorological Organization. The 1.5 degrees Celsius threshold was set by the 2015 Paris Agreement to limit global warming. “We want to call for speed; we want to call for scale,” Neo said. “We also want to call for the most cost-effective measures that can be deployed to address these challenges.” Some of the measures may require more structural changes and investments in infrastructure, she said. “We need to foster the sense of collective responsibility and also call on leadership across all sectors to contribute toward the climate,” Neo said. As the world’s largest emitter, China has made ambitious pledges to peak carbon emission by 2030 and reach carbon neutrality by 2060. But Beijing’s recent moves to support the coal industry to address energy security have sparked concerns over the country’s decarbonization progress. Coal remains the main source of energy for the world’s second-largest economy. A supply shortage last year triggered China’s worst power crisis in decades and led to shutdowns of factories and rationing of electricity in several cities. China is not the only country grappling with the challenges of the transition to net zero, and that reflects the need for balance between immediate issues while staying focused on long-term costs, Neo said. Governments should try to work toward a pathway where immediate risks are addressed by measures that harm the environment as little as possible while continuing investing in infrastructure solutions and services that can be nature positive or climate positive, she said. The financial market and the private sector can play bigger roles in promoting climate transition. It is important for industries to realize that such commitments can bring new business opportunities, Neo said. Her previous Temasek experiences focused on climate change strategy, sustainability and enterprise development. Companies need to see the green transition as something that can be very proactive for building their businesses for the future as opposed to taking a very defensive compliance perspective, Neo said. “They have to take a bit of a long-term generational view toward navigating their business through current challenges,” she said. For burgeoning green finance markets like China, proper standards, disclosures and metrics to guide financial institutions in reviewing their protocols are needed to make the financial tools more effective in benefiting long-term green transitions, Neo said. This is an area where a lot of global collaboration and sharing of best practices are needed, Neo said. Despite all the disruptions and frictions, Neo said she expected the WEF to provide a platform for more conversation about partnership. “We need to think about connecting the dots between public and private sectors, between geographies across communities, and even across generations,” she said.
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