3.23 AM Wednesday, 24 July 2024
  • City Fajr Shuruq Duhr Asr Magrib Isha
  • Dubai 04:16 05:39 12:28 15:52 19:12 20:35
24 July 2024

Action on Climate and Trade initiative aims to help developing countries meet climate goals: WEF

Published
By WAM

Action on climate change requires major economic investment and developing countries will now get support through the newly-launched Action on Climate and Trade (ACT) initiative, the World Economic Forum (WEF) said in an article on Thursday.

Launched by the World Economic Forum, the World Trade Organisation (WTO) and the World Bank Group, the scheme aims to help participating countries, including least-developed countries, to use trade to meet their climate targets.

“These three institutions are going to leverage their analytical and capacity-building programmes to deliver participating developing economies with analysis specific to their trade flows to support their climate mitigation and adaptation goals,” the article quoted Kimberley Botwright, Head of Sustainable Trade at the World Economic Forum, as saying during the initiative's launch.

“ACT will also drive public-private dialogue around this analysis to help stakeholders define and take actions to use trade for climate mitigation and adaptation. More concretely, ACT will start with one pilot economy and then we hope to scale work in the months to come.”

Initiatives like ACT are vital to help developing countries achieve their national adaptation climate plans and nationally-determined contributions (NDCs) as outlined under the Paris Agreement. After all, it is often the lowest income countries who are the most impacted by global warming but only account for one-tenth of emissions.

“For developing countries, trade can help address many challenges and opportunities related to climate change. Developing countries are in a unique position – they’re seeking to achieve their development goals, including through trade, while simultaneously adapting to climate and contributing to its mitigation,” explained Mona Haddad, the World Bank Group’s Global Director for Trade, Investment and Competitiveness.

Vulnerable populations in developing economies often suffer disproportionately damaging outcomes in terms of health, food insecurity and livelihood, among others, and there is only a narrow window of opportunity to put mitigating and adaptation policies in place.

“Urgent action is needed to meet climate goals. Many companies are undertaking supply chain decarbonisation and looking to green trade. Developing countries must be empowered to identify new opportunities and shape a future net-zero global economy,” Sean Doherty, Head of International Trade and Investment at WEF, said in a statement.

  • Tailored trade analysis on climate change

ACT will use the expertise of the three participating organisations to provide participating economies with tailored trade analysis so they can plan for the impact of climate change on trade, leverage opportunities for climate action and trade growth, and identify areas of collaboration with partners in a bid to reach net zero.

“Emerging markets has abundant availability of cheap, affordable renewable energy that can be built out. That can be a basis for a competitive position in the future, especially if we are driving a change - as we need to do - towards a greener economy. Then this is a significant opportunity,” Terje Pilskog, the CEO of Scatec, said during the launch panel.

Domestic stakeholders will be involved in the analysis through public-private dialogues in an inclusive bottom-up model that mirrors the structure of the Paris Agreement, where climate efforts are determined by countries according to their priorities, interests and challenges – with Egypt likely to join the pilot phase of the ACT initiative.

“The climate crisis is calling for rapid and effective collective action using every tool in the toolbox. Trade policy offers WTO members, including developing members, a wide variety of options to enhance their climate change adaptation and mitigation strategies,” Aik Hoe Lim, Trade and Environment Division Director at the WTO, said in a statement.

“This new pilot initiative by the World Bank Group, the World Economic Forum and the WTO Secretariat will focus on supporting developing nations to leverage trade to improve their climate resilience and decarbonisation plans in a way that is aligned with their specific needs and local circumstances.”

  • Trade, investment to support climate action

The World Economic Forum believes that business supply chains, in particular, can be an important driver of sustainability and that trade can support efforts to reduce emissions through climate-friendly technologies.

Communities associated with the Forum have identified 25 technologies and accompanying services that trade policy-makers should prioritise to accelerate emissions reductions. These sit across five areas found in many countries’ climate action plans and comprise Refrigerants; Energy supply; Buildings; Transport; and Carbon capture and storage.

Governmental and private sector organisations can therefore ensure that global trade and investment supports action to reduce emissions by making climate-friendly technologies available, although collaboration will be crucial in achieving this aim.

"When we scale the flow of green investment, we need to scale the flow of private capital. Public capital will not be enough to address the climate ambitions that we have," added Rami Rafih, Managing Director and Partner at Boston Consulting Group (BCG), during the initiative's launch panel.