Cities are at the forefront of the climate change battle and making them more environmentally friendly in emerging markets may offer a $29.4tn investment opportunity, according to a report. The bulk of investment needs, estimated at $24.7tn through to 2030, will be in the construction of new buildings or retrofits of existing structures, according to a report from the International Finance Corp, a sister organisation of the World Bank. Other areas of green investment include electric vehicles, water and wastewater management and infrastructure.
The East Asia Pacific region, which includes countries like China, Indonesia and the Philippines, will probably attract the largest amount of green capital. Latin America and the Caribbean will take a remote second place.“Efforts to successfully limit global warming hinge on cities,” according to the report. “More than half the global population lives in urban areas and this share will continue to rise over the next 30 years.Crucially, cities consume much of the world’s energy and produce more than 70% of global carbon emissions.”
National governments have diverged and dithered on their commitments to tackle climate change, even as scientists warn the world must invest $2.4tn in clean energy every year through 2035 and cut coal-fired power to almost nothing by 2050 to avoid catastrophic damage. The decisions made by city regulators can have a direct and immediate impact on people, perhaps more so than national or international policies, according to IFC.Investment in urban infrastructure for developing countries is typically funded by the public sector, but the sheer scale will require financing from private sources, according to the report. Almost 9,400 cities have committed to over 20,000 actions alongside the private sector in areas including energy, water, transport, industry, and buildings, IFC said.
Sources and photo-credits: Bloomberg, Gulf Times