World leaders gathered at the World Economic Forum (WEF) annual meeting in Davos, Switzerland last week amid a war raging in Ukraine, dwindling food supply, worsening climate events, and a world recovering from a global pandemic.
The conference, which took place in person for the first time since the start of Covid-19 restrictions in 2020, had faced a strong pushback, given how many attendees were stipulated to arrive in the Alpine resort town by way of private jet, tarnishing the event’s eco-credentials. The organisers have responded by saying that Davos is carbon-neutral, with emissions from the group’s activities being fully offset by supporting environmental projects in Switzerland and elsewhere since 2017.
As many as a third of the panel discussions this year were related to global warming, compared to last year’s which centered mostly on healthcare. Eco-Business revisits statements from policymakers on how they will come together to address the energy transition, the impacts of supply chain disruptions, food shortages, and eco-anxiety, and dives into whether what they say matters.
1. Climate leaders on the global energy crisis
Fatih Birol, executive director, International Energy Agency
“It is important that [the world’s] response to invasion and the resulting energy crisis do not lock in an energy future that will contribute to warming beyond 1.5°C , where we might lose our chance to meet climate goals.”
John Kerry, US special envoy for climate
“I am absolutely convinced we will get to a low-carbon or no-carbon economy on this planet. I cannot tell you I am convinced that we will get there in time, [but] we will do what the scientists told us we must do four years ago [at the Paris Agreement].”
The science around climate change has not changed much since the Paris Agreement in 2015, or the Glasgow Climate Pact in 2021. Limiting global warming to 1.5°C above pre-industrial times remains key to avoiding the worst impacts of climate change. Scientists say the best bet to keep under that temperature limit is to peak emissions by 2025, and halve emissions by 2030. Given current trajectories, the world is heading for an overshoot.
Meanwhile, fossil fuel demand is still soaring, with coal-fired power generation reaching an all-time high in 2021. Russia’s invasion of Ukraine, which has resulted in trade and political fallouts, has created massive volatility in hydrocarbon prices, and spurred some countries to bring forward their domestic renewable energy targets. However, major fossil fuel exporters, such as the United States (for oil and gas) and Australia (for coal) are still looking at windfall profits from filling short-term energy needs.
At one of the Davos sessions, US special envoy for climate Kerry said that Ukraine’s invasion is now being used as a lever to highlight the need for energy security. “Nobody doubts that there are challenges to meet current energy demands, but that does not mean that we should drill a lot more, pump a lot more or build more infrastructure to make up for what Russia is cutting us out from,” said Kerry.
2. Asia’s biggest polluters reaffirm climate commitments…while reiterating realities
Xie Zhenhua, China special envoy for climate change
“To achieve the Paris Agreement goals, I think we should work towards a low carbon and circular economy approach… Our focus is to build a system based on renewable energy and try to move away from fossil fuels.”
Chinese special envoy for climate change Xie reaffirmed China’s promise to do what is needed to meet the goals of the Paris Agreement, despite the nation, already the world’s largest emitter, doubling down on coal to combat the energy crisis. China set strict decarbonisation goals last year, but these targets were relaxed and coal production ramped up amid high energy prices and electricity shortages recently. It has said it would only cut down on coal from 2026 onwards.
At Davos, China pledged to plant and conserve 70 billion trees by 2030 to suck up more carbon emissions, though experts said it should not be a distraction from reducing emissions, nor a threat to existing biodiversity.
Hardeep Singh Puri, India minister of petroleum and natural gas
“We are a country where 60 million people go to the petrol bunk every morning to fill up. One of the things we need to ensure is that there is no energy shortage, in any form, in a large country, which has a population of 1.4 billion people.”
The world’s second most populous country is also trying to balance development with decarbonisation. It pledges to achieve net-zero emissions by 2070.
On the other hand, India has said it wants to have 450 gigawatts of solar and wind power by 2030. This week, it announced plans to reduce power output from coal plants, but not shut them down. Coal, oil and solid biomass make up over 80 per cent of India’s current energy needs.
At Davos, there were also developments on the private front. Indian firms will soon join the Alliance of CEO Climate Action Leaders, a WEF-led initiative to spur heads of corporates to do more against global warming.
The WEF said in a statement that the India chapter will “bring together the government, businesses and other key stakeholders” to deliver India’s 2070 net-zero target, set last autumn. With the major polluter’s entry, firms in the alliance now generate more emissions in a year than the European Union.
3. Food shortages amid conflict and climate change
Rajiv Shah, president of The Rockefeller Foundation
“Food and its availability, quantity and quality are critical to the maintenance of the planet’s stability. My biggest concern, frankly, is that we are just starting a food crisis that is far worse than the one from 2007 to 2009. By the time we get to August, September, October this year, commonly known as ‘the hunger season’… the consequences of this food crisis in terms of global instability, mass migration, famine in certain parts of the world [will be upon us].”
The “hunger season” traditionally refers to a specific period after crops are planted, and before they can be harvested. The Russia-Ukraine crisis has limited exports of key commodities such as wheat, corn and sunflower oil from the region, resulting in shortages and price hikes at an inopportune time when the world enters a season of food supply depletion. Some countries have instated export bans to keep domestic supply up and prices down, such as Indonesia, which banned the export of palm oil for four weeks in April and May.
Extreme weather across regions in Africa, Australia and most notably India has further impacted crop yield. India still has a wheat export ban in place, after a severe heatwave singed harvests. Meanwhile, neighbouring Sri Lanka is facing both a food crisis and an economic crisis, widely believed to be caused by bad government decisions, among which is an abrupt switch to organic farming which may cut crop output by 50 per cent this year.
David Beasley, executive director of the United Nations World Food Programme, said at Davos that what the world is witnessing now is a case of “taking food from the hungry to give to the starving”. The programme estimates that 325 million people are facing acute food insecurity.
The food price spike that started in 2007 is believed to be a contributing factor to the Arab Spring, a series of popular uprisings across the Middle East that toppled several governments.
Elizabeth Wathuti, founder of youth environmental group Green Generation Initiative
“The reason why young people are anxious is not because of the fact that science says that things are going to be catastrophic. It’s because what people are doing and what we see leaders are doing are still far away from what science says we must do.”
The latest reports by the Intergovernmental Panel on Climate Change (IPCC), a network of scientists under the UN, took a deep dive into how global warming affects mental health. Issues it looked into include grief over lost natural history, trauma from extreme weather events, and learning about climate change itself.
Eco-anxiety is a rising trend among youths who experience worry and guilt over their role in fighting or contributing to climate change.
There may be a disconnect between how young people and the older generation view the climate crisis, said David Dao of the WEF initiative Zurich Hub on a panel focused on eco-anxiety.
“Countries and investors expect a return [when investing in nature]. They are not for free.” On the other hand, young people look at the crisis as an existential and a moral crisis, and there is a “discrepancy” between how the two sides think, he said.
5. Standardising ESG efforts
Marc Benioff, chief executive of Salesforce
“We need a new form of environmental capitalism wherein all companies commit to net-zero and start relying exclusively on renewable energy sources.”
Laura Cha, chair of Hong Kong Exchanges and Clearing Limited
“In order for disclosures to be meaningful, we need to have harmonised standards.”
Standardisation has been a core tenet of private sector sustainability initiatives, to put firms on a level playing field and avoid greenwashing. As it stands, there are more than 600 ESG ratings in use today, making it hard for firms’ credentials to be compared.
On the net-zero front, only a fifth of the world’s 2,000 largest public companies have set targets. Studies have found that most Asia Pacific firms have no credible targets, and claims by the world’s 25 biggest firms lack integrity.
At this year’s conference, key business leaders called for more harmonised ESG standards, acknowledging that the private sector needs to have better climate disclosures.
More of Eco-Business’ coverage of the WEF Annual Meeting:
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