As social inequalities and social disruptions expand due to the pandemic and wars in selected countries, humanity faces a prolonged humanitarian crisis. With the world more polarized than some years back, the focus on social innovation is expected to slow down. OECD 2018 estimates of a $6.9 trillion yearly budget until 2030 to meet the UN environmental and developmental goals 1 will increase as we progress further. However, the sustainable debt market shows resilience in terms of issuance. The Sustainable Debt market (Green, Social and Sustainability Bonds) totaled $1.7 trillion last year according to Climate Bonds Initiative. The middle Road came out with a module and read on Sustainable Finance. Download the publication on Sustainable Finance here.
Green bonds remain the dominant theme measuring ~63.5 percent of the total sustainable debt market. Development markets accounted for 80 percent of the green debt market with Europe having a lion share of 48 percent. The social bond market gained the maximum in percent increase among all the bonds, with social label growing by 1107 percent with the addition of pandemic bonds within the social debt arsenal in 2020. Among the countries, China was second to Supranational in the social bond category. In 2020, China came out with its green bond guidelines to facilitate standardization. One significant aspect is infrastructure, with transport theme the third-largest market within the green label. Asian Development Bank estimates that with 250 million people living below the poverty line, developing Asia will require about $26 trillion of climate-adjusted infrastructure investments by 2030. Climate finance will certainly play a key role in addressing these concerns.
As of 2020, 28 countries have communicated low emission development strategies to the UNFCCC. One of the major policy initiatives is to either subside low emission or energy efficient products while tax products or activities that add greenhouse emissions to discourage their consumption and production.
Refer to the educational video of externalities to under positive and negative externalities. Although revenues due to carbon entanglement remain high for many regions i.e. revenues as a percent of fossil fuel extraction, carbon pricing is still applied to only 20 percent of all carbon emissions. 1 Refer to the upcoming tutorial on externalities under Online Learning.
Copenhagen, the capital of Denmark found the use of greener spaces saves EUR 940 million to cope with heavy downpours in comparison to relying on grey infrastructure. 1 Nature-based solutions are a panacea for not only conserving marine and coastal ecosystems but for also developing greener cities. Singapore is an excellent example of using nature-based solutions as part of a long-term strategy in implementing climate change. In Singapore, a third of the island is covered by trees enabling social change and impact for the environment and citizens. As part of its 2030 Green Plan, Singapore plans to invest 50 percent more (200 hectares) of land for nature parks as part of its biodiversity drive. The fact that every household will live within 10 minutes of walk to a park, has numerous positive externalities example healthier life, lower healthcare costs, better wellbeing, more productivity at work, etc. The country is increasingly deploying circular economy solutions and by 2030, expects to reduce waste to landfills by 30 percent. Many ground-breaking initiatives like expanding the cycling network to 1320 km and raising the share of public transportation to 75 percent by 2030 can serve as a beacon for other countries in implementing and understanding impact evaluation to foster a greener tomorrow.
Singapore’s mind-blowing thought leadership initiatives show how a small country despite having limited natural resources, can define the paradigm in leading the way for a better world.
Financing Climate Futures Rethinking Infrastructure
SUSTAINABLE DEBT GLOBAL STATE OF THE MARKET 2020 | Climate Bonds Initiative
Singapore Green Plan 2030 | https://www.youtube.com/watch?v=oNFeOl7pW9s&t=7s