Economic Growth and Climate Action — A Formula for a Low Carbon World #Auspol

As Chief Operating Officer and Managing Director, Sri Mulyani Indrawati is responsible for the institution’s operations in all regions and networks covering the thematic areas of human development; sustainable development; poverty reduction and economic management; and financial and private sector development. In addition she oversees other administrative vice presidencies and functions, including the Integrity Vice Presidency, Sanctions Board Secretariat and the Office of Evaluation and Suspension. 
Ms. Indrawati joined the World Bank in June 2010. Previously she served as Indonesia’s minister of finance in addition to being the coordinating minister of economic affairs. During that time she guided the economic policy for one of the largest countries in Southeast Asia, and one of the biggest states in the world, navigating successfully the global economic crisis, implementing key reforms, fighting corruption, and earning the respect of her peers across the world. She is credited with helping to steer Indonesia through the challenging but successful transition from autocracy to democracy.

Most people now realize the cost of inaction to deal with climate change is far higher than the cost of action. The challenge is mustering the political will to make smart policy choices.
A new report by the Global Commission on the Economy and Climate, of which I am a member, shows climate action delivers local development benefits as well as emissions reductions. In fact, smart policy choices can deliver economic, health and climate benefits for developed and developing countries alike.
Multilateral Development Banks like the World Bank Group can play a crucial role in helping countries follow a transition to low carbon growth by using scarce government resources smartly and leveraging much larger, long-term private investments.
The report makes key recommendations for turning hurdles to reduce greenhouse gas emissions into areas of growth. Among them:
Focus on cities:
Urban areas should implement low-carbon strategies by 2020 and prioritize better planning and investment in public transport, building efficiency, and better waste management.

Protect forests and increase agricultural productivity: Bring together forest countries, developed economies and the private sector to halt deforestation by 2030 and restore degraded farmland. This would enhance agricultural resilience, strengthen food security, and improve livelihoods for agrarian and forest communities.

Invest in clean energy: We can only provide clean energy for all if we reduce the cost, and we need to use energy more efficiently.

Not all recommendations will work for all countries. Policy options should suit each country’s specific needs, under a comprehensive strategy. And implementing these actions will come with challenges, including large up-front costs and long-term financing of 15 to 25 years.
Clearly, the opportunities and benefits, including for future generations, outweigh the downside.

The report finds, for example, that comprehensive investments into low-carbon urban developments could save around $17 trillion globally by 2050. And investments in energy efficiency could boost cumulative economic output globally by $18 trillion by 2035. The report also finds that businesses are already driving a growing $5.5 trillion global market for low-carbon goods and services.
Most importantly, if implemented, the recommendations could achieve almost all emission reductions that are needed to keep global temperatures from rising less than the critical 2°C by 2030.
But the key to success is cooperation between governments, cities, communities, development banks and the private sector. We need to leverage existing partnerships and resources, whether domestic or multilateral.
There is a lot of international momentum for climate action leading up to COP 21, the critical climate talks in Paris end of this year. At the UN Climate Summit in 2014, more than 73 countries and 1,000 companies and investors signaled their support for action through pricing carbon to drive investments in a cleaner economy. In June the G7 recognized the need for deep emission cuts. Multilateral banks can play a key role in achieving policy changes and shifting resources to low-carbon investments.
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