A new report released by the World Economic Forum shows that climate change is arguably the most pressing threat to the world economy. And with the world population set to increase from 7 billion to 9 billion by 2050, the report suggests that greening the economy is the only viable way to accommodate this growth. To this end, the Green Investment Report lays out a plan where a $700 billion investment in the global economy towards things like renewable energy and efficiency measures would go a long way towards curbing climate change.
The report was compiled by the Green Growth Action Alliance, a public/private group that was launched at the G-20 meeting in Mexico last year. The report comes in anticipation of the annual World Economic Forum meeting in Davos, Switzerland this week where government and business leaders will discuss the effects of climate change on the global economy.
Currently, infrastructure spending is expected to hit $5 trillion each year without any consideration of climate change. The report suggests that an additional $700 billion investment may successfully address climate change through promoting cleaner energy production and energy efficiency in the building, industry and transportation sectors. Not all of that money would have to come from the private sector. The report indicates that an increase of $36 billion in the current $96 billion spent globally on reducing climate change could spur an additional $570 billion of private investment.
World governments are still bickering about who should pay for reducing greenhouse gas emissions. In last year’s climate negotiations in Qatar, the best the attending nations could do was agree to make a pact to limit climate change that would only go into effect in 2020. But studies have shown that acting now to limit further global warming to within 2 degrees Celsius would be much cheaper and may even spur economic growth.