The global economy could see US$26 trillion in growth over the next twelve years by burning a lot less carbon, a coalition of former heads of state, ministers and CEOs said.
The growth would come from matching new infrastructure needs with low-carbon options, the Global Commission on the Economy and Climate said in their fourth major report, Unlocking the Inclusive Growth Story of the 21st Century, published Sept. 5.
“It’s a shockingly high number, but at the same time if you look at the size of the economy it’s not shockingly high,” report co-author Jan Corfee-Morlot said in an interview with Corporate Knights. “It’s going to be less than a few percent.”
The commission is making the case that putting climate chance concerns into economic growth models won’t cost much more than business-as-usual and actually produces new sources of wealth.
Similar research published by the OECD in May 2017 said the world will need US$6.3 trillion to meet its infrastructure needs between 2016 to 2030 and that it would cost an extra US$0.6 trillion to make those projects climate compatible.
The combined investment would increase GDP in G20 countries by up to 2.8 percent in 2050, the Investing in Climate, Investing in Growth report said.
The OECD’s figures on growth isn’t cumulative like the Global Commission’s, Corfee-Morlot said. But it did include economic gains from avoiding climate change impacts, which the commission didn’t have the expertise to include, she said.
In the commission’s model, benefits in 2030 include avoiding 700,000 premature deaths from air pollution, US$2.8 trillion in revenues from carbon pricing and savings from fossil fuel subsides, 65 million new jobs, higher GDP growth and an increase in female employment, their report says.
Compared to past reports, the commission examined investments needed to ensure a ‘just transition’ – a phrase that covers job loss concerns for fossil fuel-dependent industries, Corfee-Morlot said.
“That has been, until now, been largely overlooked in the climate change space,” she said.
The commission’s 38 members include former Mexican president Felipe Calderon, former Nigerian finance minister Ngozi Okonjo-Iweala and Unilever CEO Paul Polman.
The fact the commission’s political members are out of office allows them to influence current leaders while remaining independent, Corfee-Morlot said.
“It’s not politically tied to G7 or G20 countries which means we can be a bit bolder and clearer on some of the messages,” she said.