Name: One thing I can change: Invest in emerging economies
Uploaded: 2023-08-25T12:50:15.566Z
Duration: 267.2

OTIC-Invest in emerging economies_V2.mp4

OTIC-Invest in emerging economies_V2.vtt

English

{{00:00:00}}
As an investor, one thing you can
change in order to reduce climate

{{00:00:05}}
destruction and chaos by 2030 is
to begin investing in emerging

{{00:00:09}}
economies and their climate solutions.

{{00:00:21}}
Why start with emerging
economies rather than your own?

{{00:00:24}}
Well, most finance today flows into
developed economies, and so that

{{00:00:29}}
financing will continue to expand.

{{00:00:32}}
But one of the areas that is
most overlooked is emerging

{{00:00:34}}
economies, where the majority of
the world's emissions now reside.

{{00:00:38}}
The question of how we get to net
zero by 2050 will be decided within

{{00:00:42}}
these emerging economies and the
places that need to move the fastest.

{{00:00:47}}
Are many of these different areas that
are still looking to balance development

{{00:00:51}}
and environmental consideration,

{{00:00:56}}
what investing developing countries means
and the practical steps you would need

{{00:01:00}}
to take really gets down to the types
of projects around not only providing

{{00:01:06}}
clean energy, but also providing the
necessary services that countries

{{00:01:11}}
and citizens will need in order to be
resilient in the face of climate change.

{{00:01:15}}
And to ensure improving living standards
so infrastructure is central as is energy

{{00:01:21}}
is mentioned, but also a number of other
support services that provide for a

{{00:01:26}}
healthy and flourishing society to think
about what has to happen practically to

{{00:01:30}}
make these countries investable really
looks at a variety of different risks

{{00:01:35}}
and how we address them and offset them.

{{00:01:37}}
And so some of those risks
begin with currency risks.

{{00:01:40}}
We know that there's volatility
in different currency markets.

{{00:01:44}}
We know political risks can be a
concern, especially as countries

{{00:01:48}}
have different legal systems.

{{00:01:49}}
We also know, though, that the scale
and scope of the projects themselves

{{00:01:54}}
need to offer a return that is
commensurate with the risks being taken.

{{00:01:57}}
So this is where elements of
blended finance and other de

{{00:02:01}}
risking measures can really bring
private finance into the space.

{{00:02:05}}
that presently has been mostly occupied
by development financial institutions.

{{00:02:12}}
How can smaller scale investors make
a difference in emerging economies is

{{00:02:17}}
such an important topic because there
are so many small investors and it's

{{00:02:21}}
critical that all of them realize that
nobody is too small to make a difference.

{{00:02:25}}
When it comes to providing funding
and financing for clean energy,

{{00:02:30}}
many products as well as structures
exist that allow one to take a

{{00:02:35}}
piece of a deal that allow one to.

{{00:02:37}}
Get involved in something where high
leverage can really drive change.

{{00:02:42}}
And so whether we're talking about smaller
amounts or we're talking about a piece

{{00:02:45}}
of a larger project, there are many ways
that make this more accessible, even

{{00:02:49}}
for the smallest of retail investors.

{{00:02:52}}
One of the areas of perhaps
lowest hanging fruit that I

{{00:02:55}}
would say for smaller investors.

{{00:02:57}}
is around power generation.

{{00:03:00}}
Right now, we're at a point where we
can produce clean energy at rates that

{{00:03:04}}
are not only competitive, but in many
cases better than with fossil fuels.

{{00:03:08}}
These are places where energy
is absolutely necessary to meet

{{00:03:11}}
a growing demand, a growing and
improving standard of living.

{{00:03:15}}
and one where the continual
production of that energy is going

{{00:03:19}}
to be the catalyst to that society.

{{00:03:21}}
So we'll see energy demand only
continue to grow, but we also will

{{00:03:25}}
see a real opportunity to build and,
and provide this energy in a way that

{{00:03:30}}
is catalytic and flows throughout
that entire emerging economy.

{{00:03:36}}
If investors start acting immediately,
I would say it's not really possible for

{{00:03:41}}
us to stop global warming by 2030, but we
can get ourselves onto a trajectory that

{{00:03:48}}
will bring both net zero into reality
by 2050 and keep the levels of warming

{{00:03:53}}
to what we see as a scientifically safe
level below one and a half degrees.

{{00:03:58}}
Will this be a very
ambitious and tall order?

{{00:04:01}}
Absolutely.

{{00:04:02}}
But given that the climate
system is also complex.

{{00:04:05}}
We know that the actions we take today
will have outsized impact in the future.

{{00:04:09}}
So the time tact is not in 2030 or 2050,
but today both to hit our decarbonization

{{00:04:15}}
goals for 2030 and get to that safe
trajectory that we need to be at for 2050.

As an investor, one thing you can
change in order to reduce climate

destruction and chaos by 2030 is
to begin investing in emerging

Why start with emerging
economies rather than your own?

Well, most finance today flows into
developed economies, and so that

But one of the areas that is
most overlooked is emerging

economies, where the majority of
the world's emissions now reside.

The question of how we get to net
zero by 2050 will be decided within

these emerging economies and the
places that need to move the fastest.

Are many of these different areas that
are still looking to balance development

what investing developing countries means
and the practical steps you would need

to take really gets down to the types
of projects around not only providing

clean energy, but also providing the
necessary services that countries

and citizens will need in order to be
resilient in the face of climate change.

And to ensure improving living standards
so infrastructure is central as is energy

is mentioned, but also a number of other
support services that provide for a

healthy and flourishing society to think
about what has to happen practically to

make these countries investable really
looks at a variety of different risks

And so some of those risks
begin with currency risks.

We know that there's volatility
in different currency markets.

We know political risks can be a
concern, especially as countries

We also know, though, that the scale
and scope of the projects themselves

need to offer a return that is
commensurate with the risks being taken.

So this is where elements of
blended finance and other de

risking measures can really bring
private finance into the space.

that presently has been mostly occupied
by development financial institutions.

How can smaller scale investors make
a difference in emerging economies is

such an important topic because there
are so many small investors and it's

critical that all of them realize that
nobody is too small to make a difference.

When it comes to providing funding
and financing for clean energy,

many products as well as structures
exist that allow one to take a

Get involved in something where high
leverage can really drive change.

And so whether we're talking about smaller
amounts or we're talking about a piece

of a larger project, there are many ways
that make this more accessible, even

One of the areas of perhaps
lowest hanging fruit that I

Right now, we're at a point where we
can produce clean energy at rates that

are not only competitive, but in many
cases better than with fossil fuels.

These are places where energy
is absolutely necessary to meet

a growing demand, a growing and
improving standard of living.

and one where the continual
production of that energy is going

So we'll see energy demand only
continue to grow, but we also will

see a real opportunity to build and,
and provide this energy in a way that

is catalytic and flows throughout
that entire emerging economy.

If investors start acting immediately,
I would say it's not really possible for

us to stop global warming by 2030, but we
can get ourselves onto a trajectory that

will bring both net zero into reality
by 2050 and keep the levels of warming

to what we see as a scientifically safe
level below one and a half degrees.

Will this be a very
ambitious and tall order?

But given that the climate
system is also complex.

We know that the actions we take today
will have outsized impact in the future.

So the time tact is not in 2030 or 2050,
but today both to hit our decarbonization

goals for 2030 and get to that safe
trajectory that we need to be at for 2050.

One thing I can change

Best Practice

How and where money is invested will have a crucial impact on whether we manage to reduce emissions by 2030 and keep the temperatures under 1.5º. In fact COP28 - the big UN climate conference later this year - will focus on heavily on finance.

Climate investing has been mostly in developed economies so far, but the highest emissions currently come from emerging economies.

Listen to David Carlin, head of climate risk for the UN's Environment Programme Finance Initiative (UNEP FI), as he explains why you should consider investing in new economies and why immediate action is crucial for a global and equitable sustainable future.