At the G20 India Second Development Working Group (DWG) side event, co-hosted by the Ministry of External Affairs, Research and Information System for Developing Countries (RIS), and The Energy and Resources Institute (TERI) in Kumarakom, Kerala, experts underscored the unique challenges faced by developing countries, particularly the enormous costs of green transitions, and the need to adhere to the principles of equity in just transition.
In her opening remarks, Eenam Gambhir, DWG Co-Chair, emphasised the urgent need for a new vision of green development, one that is emerging from the Global South. “To realise a world where growth and sustainability can be next to each other without trade-offs, we need a radically different international enabling environment and policy support system that is adaptive, [which] takes into account the diverse needs of the developing countries, creating financing solutions catering to their needs and their conditions; proactive, which doesn’t wait for old industries to die down, but rather invests in industries of tomorrow today to ensure a smoother transition; and responsive to the evolving needs of the vulnerable communities and presents solutions to their capacity, while respecting their policy space.”
Giuseppe de Simone, Strategic Planning Officer, United Nations Industrial Development Organization, noted that Just Green Transitions (JGT) have been identified as a transformative transition needed in the proposed G20 Action Plan by India’s G20 Presidency, and he emphasised the need for change in the “way we grow, we produce, and we consume.” Calling for a systemic transformation, he said, “It will be a mix of disruptive and marginal gains. But we need to radically change the way we do things. We need an economy-wide transformation and this will generate winners and losers. So, we need it to be just.”
Noting that job creation, and retention, and JGT are critical for all countries, including the G20, de Simone said, “We need to make sure that jobs are preserved, skills are developed and the workforce is ready for the transition and the losers are supported.” He emphasised the need to include everyone in this global shift and said it is crucial to make sure that knowledge is shared, funding is provided, and that everyone has access to technology and capacity.
At the discussion on ‘Just Green Transitions – A Comprehensive, Integrated Approach’, Avinash Persaud, Special Envoy to the Prime Minister of Barbados on Investment and Financial Services Member, IHLEG on Climate Finance, highlighted the cost factor that holds back many developing countries from embarking on a green transition. “In environments where transitions are costly, we need external solutions. We need to lower the cost of capital when investing in these projects, so that it is as profitable as investing in Germany as it is in India, Vietnam, Indonesia, and South Africa,” he said.
In order to guarantee an international rate of return on investments in transition projects, he suggested the creation of a Just Green Transition Finance Investment Trust with significant capital and liquidity.
Manjeev Singh Puri, Former Ambassador and Distinguished Fellow, TERI, observed, “Global GDP savings rate is about 20 trillion USD, while the requirements for greening in the developing world today is about 5-6 trillion USD.” Puri emphasised that equity lies at the heart of just transition.
According to Sattva co-founder and partner Rathish Balakrishnan, it will be essential to upskill the current workforce, think entrepreneurially, adopt a fair model that empowers women, and credential the informal workforce in a way that is globally recognised, digitally scalable, and allows them to take advantage of opportunities in the new economy. “Where we live, how we move, what we eat and what we buy — these four choices have to transform and create newer models for us that will create skill, capacity, and requirement,” said Mr Balakrishnan.
While every transition will be country-specific, Sunaina Kumar, Senior Fellow at ORF and Executive Director at Think20 India Secretariat, who moderated the discussion, noted that there are common obstacles facing developing countries that prevent them from realising a just transition. These obstacles span areas of finance, technology, and capacity building. “To get past these challenges, global cooperation will be necessary,” she said.
Source: Outlook Planet