2023 is a critical year for the implementation of the Paris Agreement
Kevin Li, Researcher, CarbonCare InnoLab
The year 2022 was ended up with two international environmental negotiations, namely the 27th United Nations Climate Change Conference (COP27) and the 15th United Nations Biodiversity Conference (COP15). After the success of a new loss and damage fund established to protect vulnerable countries over the Sharm El Sheikh Implementation Plan, COP15 also approved the Kunming-Montreal Global Biodiversity Framework. Countries agreed to restore and protect 30% of the earth's land, coastal and marine ecosystem by 2030. Developed countries must also invest 30 billion U.S. dollars annually to protect the biodiversity in developing countries before 2030. Although the framework is not binding, all countries have agreed to turn it into a programme of action, comparable to the "Paris Agreement" on biodiversity.
Since the dual issues of climate change and biodiversity reached consensus in 2022, and began to accelerate the pace of action, 2023 has become a critical year for implementation. Governments and business communities around the world hold high the two major tasks of climate and biodiversity actions at the same time, and promise to accelerate action. It is time for us to track whether countries fulfil their commitments.
The world's political and business leaders talk about climate action, which may be suspected of greenwashing
In addition to continuous tracking of greenhouse gas emissions and renewable energy deployment, scientists and the public need to understand the latest trends. The speeches of world leaders at some global conferences have become an important indicator of progress in climate action. The annual meeting of the World Economic Forum (WEF) in Davos, Switzerland and the Abu Dhabi Sustainability Week (ADSW), which are being held this week, happen to be the first inventory of this year.
It just so happened that HKSAR’s Financial Secretary, Mr. Paul Chan Mo-po, also went to Switzerland to attend the WEF annual meeting, who vowed to introduce Hong Kong's development opportunities to the outside world and to tell a good "Hong Kong story". The theme of this year's WEF annual conference is "Strengthening Cooperation in a Fragmented World", which poses a difficult question for global political and business leaders. At the same time, the Global Risk Report was published on the eve of the WEF annual meeting, pointing out the top ten global risks. The top three risks are related to climate change, and seven of the top ten risks are also related to climate. But geopolitical risks are overshadowing the global Climate and biodiversity processes. It is not known whether Paul Chan, who acts as the main financial official in Hong Kong, took Hong Kong as an example and took the opportunity to offer advice on addressing climate risks, proving that Hong Kong can make substantial contributions to global climate action.
In fact, as the first global political and business event at the beginning of each year, the WEF annual meeting is naturally shaping the political and economic agenda of the year. Civil society and think tanks from various countries are taking the opportunity to speak out on different issues, hoping to influence the agenda. Although climate issues have become the focus of WEF after years of advocacy work, climate work must be the focus of civil society’s inspection. Even today, political and business leaders are talking about climate action and how to ensure energy security through the energy transition of various countries, but the actual impact of reducing emissions has yet to be tested. It is suspected that this is just a public relations and greenwashing gimmick, which will damage the credibility of climate action. Not to mention that many political and business leaders went to the meeting venue by private jets with high carbon emissions.
COP28 President's conflict of interests casts shadow over meeting
On the other hand, the United Arab Emirates (UAE), the host of the 2023 United Nations Climate Change Conference (COP28), is also hosting the Abu Dhabi Sustainability Week this week, kicking off the UAE's leadership in this year's climate negotiation process. The event overlaps with the annual meeting of the World Economic Forum, and the intention is obviously to facilitate political and business leaders to participate in the two meetings at the same time. However, before the start of the event, the UAE announced the appointment of Dr. Sultan bin Ahmed Al Jaber, the country's minister of Industry and Advanced Technology and Chief Executive Officer of the Abu Dhabi National Oil Company (ADNOC), as the President of COP28, which aroused criticism from the outside world. Its oil interests are in dispute. He is the chairman of Masdar, the country's largest state-owned renewable energy investment company, which promotes the country's renewable energy development. He is also the country's special climate envoy to participate in the COP negotiations, so he is familiar with the climate negotiation procedures. However, the issue of conflict of interest has been obscured by the COP28 process.
Back to the Abu Dhabi Sustainability Week. It continued with some of the discussions at COP27 last year, focusing on issues such as promoting just energy transition, technological innovation, climate financing, and inclusion of women and youth in climate process and energy transition, and specifically the technologies such as green hydrogen and nuclear energy. In addition, it also co-hosts the annual meeting with the International Renewable Energy Association (IRENA) to promote the massive uptake of solar and wind energy in developing countries, and promotes women's participation in the development of renewable energy.
The two conferences simultaneously outline the agenda that political and business leaders care about and advocate this year, and are also in line with the keynote of COP27 last year. However, as Dr. Sultan Al Jaber pointed out in his speech at the opening of Abu Dhabi Sustainability Week, “we are still far off track.” The pace of reducing emissions in line of 1.5 degrees’ target also means that renewable energy generation capacity should be tripled in 2030. In addition, he emphasized that 2023 is the first year of global stocktaking since the adoption of the Paris Agreement, and expressed his attitude of attaching importance to it. These statements are encouraging.
Climate finance still fails to catch up with demand
However, we are worried the so-called accelerated pace of emission reduction may mean that the oil interests represented by Dr. Sultan Al Jaber will continue to regard natural gas as a so-called "pragmatic" energy transition solution, and nuclear energy companies will also take the opportunity to continue to promote the risky nuclear power technology. These high-cost, high-risk energy technologies will only make the progress of reducing emissions further off track.
In addition, this year we will continue to follow up another important topic of COP27, which is climate financing. Whether in Davos or Abu Dhabi, the current climate finance discussion still lacks fresh perspectives. US climate envoy and former Secretary of State, Mr. John Kerry, talked about the key role of the private finance in climate financing in Abu Dhabi, and announced plans for an Energy Transition Accelerator led by himself and two private foundations. The WEF, together with 45 private philanthropies, announced a commitment of a total of 3 trillion US dollars to support climate and biodiversity projects. However, according to WEF statistics, in 2021 major private philanthropic foundations have pledged to support climate funds of US$810 billion, but only 2% are actually used for emission reduction projects, which is unacceptable.
Hong Kong has the conditions to become a role model for city climate action
As for governments’ commitments, it seems that everyone is waiting for the first Loss and Damage funding arrangement meeting in March since it was announced, or June's climate finance summit led by the presidents of Barbados and France. Government representatives of other countries are keeping silent. However, the two meetings did not re-emphasize the leading role of the government in climate financing. In particular, the COP27 meeting demanded developed countries to invest US$100 billion in annual climate financing, which has not met the targets, and most of it is allocated in the form of loans. In addition, the implementation mechanism of the loss and damage fund expected by all walks of life is still to be formulated. It seems that this year’s climate finance negotiation will still be in a state of see-saw or even stalemate.
Finally, looking forward to 2023, we still have many important meetings on the agenda, including the UN Water Conference, the G7 Leaders Summit, the UN Bonn Climate Conference, the G20 Leaders Summit, the 78th UN General Assembly and Sustainable Development Goals (SDGs) summit, and this year's COP28, are major milestones in the climate process this year. We expect that in the above-mentioned agenda, countries around the world should work together to achieve more progress and goals in climate financing, whether it is funds for mitigation and adaptation, creation of carbon markets, or loss and damage funds.
As for Hong Kong as a financial city, it is also worthy of our attention to how the city plays a key role in those global, inter-city climate alliances, such as the Glasgow Net Zero Financial Alliance (GFANZ), which was established at COP26, and the C40 Cities Climate Leadership Alliance (C40), the International Council for Local Environmental Initiatives (ICLEI) and the Global Covenant of Mayors for Climate and Energy (GCoM). In particular, Mr. Tse Chin Wan, the HKSAR Secretary for the Environmental and Ecology, has just been elected as the vice chairman of the C40 Steering Committee. We hope that Hong Kong can lead by example and use its advantages in finance and innovative technology to jointly accelerate the implementation of climate actions in cities around the world. We also hope that Mr. Paul Chan, who participated in the WEF annual meeting, will catch up with the international trend and continue to commit funds in climate finance in the budget to be announced in February, explicitly demonstrating Hong Kong's ambition in climate action.