Hello, and welcome to Making cop 26 Count, a podcast series based on the finvest 2030 webinar hosted by David Nussbaum and supported by ICAST, One Young World of Chartered Accountants worldwide. This episode is part one of David's roundtable discussion with Claire Sarah navies. And when you were they take a deeper dive into the implications of cop 26.
00:35
Now, I want to turn to some of the questions we've been having coming in, that they they cover a whole range of things, of course, but several of them come more from a macro perspective, we've we've been looking a bit more at the sort of micro economics, what about the macro economic picture? And particularly the money involved in doing all this? So you know, is work being done to quantify the costs, if we fail to meet the Paris targets? And use all the money that's going into the fossil fuel industry in subsidies? Could that be used to accelerate, adjust transition? And thinking about developing countries? For example? Isn't this going to be a huge overload of borrowing in countries which may already be facing quite pressured? macro economic environments? And so on? So I'm just checking in throughout Yeah. So thinking about this, this macro picture, and you know, as accountants ought to think about where's the money coming from? And where's it going into? And how's it being managed? Who would like to sort of give us some perspective on that, that those macro pictures or questions?
02:00
Okay, I guess from my perspective, it's, it's not letting us hide behind that. And you know, that there is definitely the ability to meet these we need to be well see, from the funding perspective, governments will be able to, to fund it. And it will be significantly easier for a global North developed countries to be able to enact these changes in their own countries, but they need to also have that global citizenship approach of recognise and rule. But certainly, from fundamental for me, it's a let's not hide behind the iniquity of pay to be funded. It needs to happen and it can happen.
02:45
And like what we're all saying, oh, sorry, no, go ahead. I was just gonna say, I think what we've all kind of touched on too is wealth. government has a role to play in this, the reality is that the private sector, and then really, each individual is going to have to, like there is a price to enable this to happen. And as you said, clear, it's got to happen. And we will just get got to get on board with it. I sometimes wish someone would come out and be a bit more honest and transparent about this course, because it is going to impact us all. And we all need to be aware of what that is. So that was probably my comment on this costing factors. And maybe as you would know, out of anyone better. So like as you've raised, like the developing countries have, there's such a gap there. And we're asking them to not dig up whatever it what we've all done as developing countries. It's a really hard one in that sense, isn't it?
03:36
Yeah, it is. And I think that was also one of the things that I know developing countries were really pushing during Katrina six to sort of take away all of these fossil fuel subsidies, because that money, I don't know the exact amount, but there's trillions of dollars. That has been, that is enforceable subsidies that we can actually take from that to invest in green or cleaner solutions. The other the other thing is that and we have learned with, with COVID, that the money actually is the what is not available is the political world, because we saw governments all over the world. I mean, we already got trillions of dollars in stimulus packages. And a lot of green organisations were actually pushing for the recovery to be green, but there was just like little as little as 0.2% of the money that went into climate priorities. So the money we know it's there. I think what is not available when it comes to climate change, and the climate conversation is that political will from governments to actually invest the money in cleaner solutions. So I think yeah, the money is there and we can find it, but we just need to get up, hold our governments accountable for elections and elect people who are passionate, or at least who are interested in climate change and to government so that they can put it into legislation and they can actually do the invest in cleaner solutions. I think that's what I would be interested in what we need to do in that sense.
05:18
Yeah, we certainly saw plenty of money becoming available to tackle the pandemic, you know, when, as you pointed out to neighbours, but maybe it's Can I just follow up on that? I mean, if we think about countries like Ghana, where tackling poverty is such a crucial priority. How do we persuade people that that should be done in conjunction with tackling climate change? That's one of the questions that sort of cop when, you know, people might feel that that's all very well for people with nice lifestyles, as Sarah was pointing out in her presentation, but, you know, we can't be bothered with that. We just need to focus on poverty. Hang on to that.
06:00
Yeah. And that's actually a very good question. I'm interested in one. And that's what I also normally always tell my colleagues as well, they say, you know, in Ghana, people are struggling to find a three square meal, you know, they don't even have what to eat. So talking to them about climate change, or the environment is just not their priority is not just as like a muscle loss of needs. But I think there's also an opportunity to on entry points that I think what needs to be done, actually, it's a sell this as a development opportunity. And we do know that there is the core benefits of climate change. So countries are not all countries like Ghana, developing countries are not going to stop building infrastructure, they are not going to stop pursuing development, but how can they pursue this development sustainably? And how does this like climate change, bring the opportunity. So when it comes to transition to renewables, the jobs that can be created the core benefits of the transition, like impacts on health, reduction of air pollution, all of these are benefits that comes with a transition. And I think this is how we should be selling that to developing countries. Because at the end of the day, we also want to catch up with walls, we also want to reduce poverty in our countries. But that can be done whilst pursuing sustainable development. And I think this is where the conversation or the discussion as should be, should be called. And this is how we can get the buy in from governments when it comes to climate change.
07:32
I would like to add to that I completely agree with what he was saying. I think on top of that, we need to fundamentally change our paradigm, or how we think about development, particularly low carbon development, I think all countries are going to have very different path. As you said, it's probably not going to make sense in the case of some developing countries to expect that the way they get to low carbon development is by going the same route as what the wealthier countries have done. At the end of the day, that is an immense opportunity for many of these countries to leapfrog the process and to develop the low carbon energy systems in fundamentally different ways. To give you an example, it might not always make sense, there are a lot of these countries to build out your main grid ad infinitum to reach 100% of a population, it could actually make more sense to have distributed solar mini grids. And also, you know, for example, there's already been business models of pay as you go solar on the village level. There are a lot of innovative thinkers and solutions out there to come back to me this point, can we make the financing available to enable these solutions? Some of these countries have some of the greatest again, from an energy perspective, solar and wind resource potential. The solutions are there. They don't have to follow the same track as rich countries. The problem is whether or not we can create a system that incentivizes these solutions to come into play. I think right now we're not doing that.