Many of the solutions that await us in the post-pandemic economic recovery involve accelerating the transition to a new decarbonized economy. Either we seize the opportunity to resume business, putting the global economy on a path towards a “net zero” world, that is, zeroing net emissions, or we will be trapped in a fossil system from which it will be impossible to escape. This is where we find ourselves now.
My conviction in this regard does not stem from an ideology provided by experts in the world of sustainability, but rather from a set of premises organized in research that had the collaboration of more than 200 representatives of central banks around the world, finance ministers of the G-20 and academics from 53 countries. The research, conducted by a group of renowned economists, which includes Nobel Prize winner Joseph Stiglitz, among others, was published on Tuesday (5) by the “Oxford Review of Economic Policy” and can be considered a historic milestone.
The authors fear that the world is at risk of jumping “from the Covid frying pan into the climate fire.” This is because, in trying to stimulate businesses to recover from the fatal recession, financial and government stimulus fails to consider climate risks and greenhouse gas (GHG) emissions. The tragedy would be consolidated, given that there is a global consensus in the scientific community that exceeding the 2°C temperature limit would cause irreversible environmental changes, which could lead to mass disasters, millions of deaths and a poorer world for all.
We had a break in the awakening of the population's awareness of climate change, which was beginning to occur, and lost prominence to the necessary prioritization of Covid-19. On the other hand, the pandemic gave people a taste of what a new normal would be in a slower, cleaner world with conscious consumption. We were forced to realize that, while technology allows us to have this new normal, with a reduction in corporate commuting, for example, on the other hand, the mandatory shutdown made us more aware of how we eat, by producing our own meals at home. The empty roads and the absence of human crowds brought back cleaner air and wildlife.
Furthermore, due to the pandemic, GHG emissions in 2020 will fall more than in any other year since the beginning of the historical series. But we know that to achieve the ideal of net zero by 2050, this indicator would have to be repeated year after year and no one wants to repeat the difficult and painful experience of being stuck at home and deprived of social contact to achieve this result.
We are fully aware that when mobility restrictions are lifted and factories resume production at the same pace as before, we run the risk of returning to the same pace we were in. But the crisis caused by Covid-19 could mark a turning point in the progress of climate change, if there is common sense on the part of political, business and financial institution leaders. After all, the crisis brings immense learning, with suffering, so that we know how to discard what is harmful and what is necessary to leverage a new normal.
The crisis has shown that governments can intervene decisively when the scale of an emergency is clear and public support is present. State intervention was crucial both in halting the increase in the infection rate, in effectively combating the virus, and in maintaining and recovering the most vulnerable. Likewise, the partnership between companies and financial institutions provided support to the State, whether for the construction of field hospitals or in the donation of equipment, which helped to prevent the health systems from being further overwhelmed.
Therefore, governments, companies and banks need to be clear that the climate emergency is like the Covid-19 emergency. But it does not arrive like a tsunami. It develops in slow motion and can be more lethal. Both have similarities in the externalities that precede them, the need for international cooperation, scientific basis, resilience, and priority actions by political and business leaders, as well as social mobilization.
In the aforementioned study, the world's leading financial thinkers agree on one thing: we must generate resources and drive post-pandemic recovery by reducing carbon emissions. Fiscal recovery programs that include climate risk analyses, that encompass positive and relevant social impacts in favor of reducing inequalities, and also forms of large-scale policies that do not shy away from the focus on reducing emissions, are more than necessary, they are urgent.
The major contributors who thought about the correlation between the post-pandemic world and climate change suggested five items that should be well positioned to contribute to the joint achievement of climate goals:
1. investment in clean physical infrastructure;
2. improvement of the efficiency of civil construction;
3. investments in education and training to address immediate unemployment and structural unemployment from decarbonization;
4. investment in natural capital for the resilience and regeneration of ecosystems;
5. clean investment in research and development.
In the national context, the five items fit perfectly into our urgent needs and must be accompanied by a sudden and exponential change in the universalization of basic sanitation. Only with this change will we finally leave the 19th century and move straight into the 21st century and the decade of implementation.
More of the same is not possible. We emerge with the certainty that we must be more resilient, and the new normal requires a joint effort to direct scarce resources towards effective changes in our social, environmental and economic levels. Thinking about this aspect, the tasks that lie ahead, and given the uncertainties in future waves of pandemics, it has never been so emblematic to say that the way out of the crisis is green. It has to be.
Article originally published in Globe.
