The boldest actions needed to curb global warming
Last week we discussed that without significant action taken to address climate change and if we continue to operate in an emissions-intensive global economy, Southeast Asia will suffer climate-induced economic losses. climate change of about $28 trillion in present value by 2070, by Deloitte estimates. This is in a scenario where average global temperatures rise more than 3 degrees Celsius above pre-industrial levels by the end of the century.
At the 2021 United Nations Climate Change Conference, scientists revealed that Earth is on track to warm by around 2.5 degrees Celsius, a full degree above the climate target. common in the world.
In contrast to Deloitte’s modeling, our researchers found that rapid decarbonization that would limit global average warming to 1.5 degrees Celsius by 2050 could generate economic gains of around $12.5 trillion in value. for Southeast Asia’s economy by 2070. This would be equivalent to adding twice the 2019 value of Indonesia’s economy to Southeast Asia in 2070 alone.
What must we do to realize this future?
Deloitte has developed a four-phase approach, starting with bold climate action from 2021 to 2030. During this time, governments, regulators, businesses, industries and consumers must push even harder to create the conditions market that would pave the way for faster growth. , greater decarbonization. We need to see transformations in supply chains and significant investments in sustainable technologies. These would lay the groundwork for the larger changes that are needed to limit global average warming to 1.5 degrees Celsius, but immediately industries in the region would be better off.
From 2030 to 2040, there should be coordinated change among stakeholders. This is when we will see the toughest changes in industrial policy, energy systems and consumer behavior. At this point, businesses and economies will begin to see the consequences of their actions in the first phase. For the region, the ongoing structural changes would bring modest economic benefits compared to those recorded during the initial phase.
This phase will be followed by the turning point, from 2040 to 2050, which would be the decade when we avoid a “locked-in” trajectory of higher emissions and when we realize the economic dividends of technological progress. By this time, the decarbonization of high-emission industries should be nearly complete and the cost of new low-emission technologies would decrease. The bold actions taken in the first two phases will now materialize in steadily increasing economic gains across the region, thanks to the direct economic benefits of decarbonization and the avoided costs of runaway climate change.
Finally, after 2050, Southeast Asia is expected to have a low-emissions future. The region’s economy would be close to net zero emissions, and interconnected low-emission systems spanning energy, mobility, manufacturing, and global food and land use would keep global average warming to around 1.5 degrees Celsius.
Reaching this future state is a formidable undertaking, but there are so many ways to do it, and there is an entire planet to mobilize. As a global network, at Deloitte we are committed to achieving net zero emissions by 2030, and at Deloitte Philippines we have strengthened and expanded our climate and sustainability advisory capabilities to better support other organizations in their efforts to be part of the climate solution. The greatest challenge we face now demands the boldest actions. Let’s start working. INQ
Deloitte Asia Pacific has published a number of reports on the economic impact of climate change on specific territories in the region. (You can find all reports here: https://www2.deloitte.com/global/en/pages/about-deloitte/articles/asia-pacific-turning-point.html)
This article reflects the personal opinion of the author and not the official position of the Management Association of the Philippines or MAP. The author is a Fellow of MAP and Managing Partner and CEO of Deloitte Philippines. Comments to [email protected] and [email protected]
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