Clean energy behind 10% of global growth in 2023, and it’s early days: Tharman
For big push on collaboration, focus on the benefits that can be gained by taking climate action early
INVESTMENTS in the transition to a clean economy make up the largest investment and growth opportunity over the last 50 years, said President Tharman Shanmugaratnam on Wednesday (Jun 5).
And the growth benefits of some of these investments can be immediate.
He cited how the clean energy sector alone contributed 10 per cent to global growth last year.
“What that means for jobs, all the ripple effects that brings, 10 per cent of global growth. And that’s still at the early stage of the journey. This is the largest investment growth and job creation opportunity we’ve seen in a long time,” said Tharman, who was speaking at a forum organised by the Indo-Pacific Economic Framework for Prosperity (IPEF).
IPEF is an economic initiative launched by US President Joe Biden in 2022, and several South-east Asian countries – Brunei, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam – are some of its participants.
To mobilise the capital needed to tackle the climate crisis, Tharman said that the global community needs to move away from pointing fingers at parties most responsible for the climate crisis and getting them to pay, to one of collaboration.
A NEWSLETTER FOR YOU
Friday, 12.30 pm
ESG Insights
An exclusive weekly report on the latest environmental, social and governance issues.
“How do we collaborate to invest for a return?... How do we get those with more resources to invest more and not think of it as a distribution of a burden? It’s not about burden-sharing. It’s about how we invest together for a return, for an economic return and for a social return,” he added.
“So we’ve got to bring every source of investment capital together, all the way from early stage, growth capital, venture capital, commercial banks, public money, philanthropic money, different risk and return preferences, you’ve got to bring them together.”
To bring about this change in mindset towards more collaboration, Tharman said that there was a need to focus on the benefits that can be accrued by taking climate action early.
SEE ALSO
Current discussions on the climate crisis tend to focus on targets in 2050 or 2100, which he said are “too distant” for the everyday person.
Instead, the focus should be on the benefits that can come about now and the next few years.
“How do we lower pollution in cities, which ordinary people really appreciate? How do we just make life more liveable by not having so much heat? All the benefits that come today and talk about that. That’s the political narrative we should talk about,” said Tharman.
“That’s what changes minds and develops a political constituency to support the types of measures we need to take, including carbon pricing, intelligent subsidy strategies, retraining, skills upgrading for workers so they can move out of industries that are too polluting towards the new industries.”
South-east Asian markets, being a core part of IPEF, can show that it’s a region of opportunities, and that there is willingness among its governments to move and bring together all stakeholders “without too much difficulty”, said Tharman.
Copyright SPH Media. All rights reserved.
