Illustrative image (Photo: AFP) Warmer temperatures are altering weather phenomena and disruptingthe balance of nature, directly affecting human activities.
The devastation caused by extreme weather disasters like typhoons,floods, and heat waves is worsening in many nations.
And the economic damage caused by climate change is alsoincreasing in line with global temperatures. Major storms destroy crops,costing billions of dollars, while rebuilding after each storm and floodrequires a huge amount of money. The more extreme the climate, the more itdamages economies.
It is a positive sign that many countries have joined the fightfor net zero emissions by 2050.
Many people worry that it is unrealistic given the standard pacewe have already set.
However, an expert in the industry believes we are capable ofachieving the target of net zero by the set time.
"We would reduce our emissions by 50% in this decade, not in20 years. So, in the next seven years, cut by half. Then, by 2050, we will havereached net zero. That sounds like a lot, but the fact is it is entirelydoable," Christiana Figueres, co-founder of Global Optimism and formerexecutive secretary of the United Nations Framework Convention on ClimateChange, said at a session at the 16th Asian Financial Forum held in Hong Kongearlier this month.
"We have the capital, we have the technologies, and we knowwhat policies work. The question now is how to align these three."
In the latest move, the US passed the Inflation ReductionAct of 2022 after leaving the 2015 Paris Agreement in 2017.
The Act is a climate change and healthcare spending bill worth 740billion USD, of which 400 billion USD is spent on energy security and climatechange programmes over the next ten years.
She also stressed that it is time for businesses to change theirmindset and understand the risks and opportunities of sustainabledevelopment.
In fact, many enterprises worldwide have been focusing on greengrowth in the past few years and using decarbonisation as a strategy to attractconsumers and investors.
The conflict between Russia - Ukraine has led to a spike in fossilfuel prices but also helped increase countries’ energy independence more thanever, Figueres added.
Consumers are also increasingly aware of climate change.More and more people prefer environmentally friendly products and chooseproducers that have environmental commitments.
Therefore, "we need to call all financial sector institutionsto move their lending or their investment portfolios from dirty energy to cleanenergy, clean products, and clean services to secure the value of theirassets," said Figueres.
Financing’s role in decarbonising the Asia region
Asia is one of the most vulnerable regions to climatechange.
A report from the International Monetary Fund (IMF) said thatemerging markets and developing economies must invest at least 1 trillion USD inenergy infrastructure by 2030 and 3 trillion USD to 6 trillion USD across allsectors per year by 2050 to mitigate climate change by substantially reducinggreenhouse gas emissions.
According to Figueres, Asian regulators are actually moving aheadof businesses and financial institutions, which is different from many otherparts of the world.
Asia’s energy demand has grown strongly in the past four decadesdue to high economic levels and increased urbanisation and industrialisation.
"So that actually means energy is at the heart of both theliability and the opportunity for the region," Figueres said.
At the moment, fossil fuels are still the main fuel source in theregion. "That is the Achilles heel of the Asia region and its financialsector."
"I must say decarbonising the energy sector in Asia is key tosustaining and increasing Asian competitiveness, and the key to decarbonisingis whatever decisions are made in the financial sector."
And Hong Kong, as Asia’s premier financial centre, could rise toplay a key role in supporting at least the Asian banking sector to reduceclimate change’s risks and take advantage of the growth opportunities, theexpert said./.
VNA