Realpolitik threatens global CO2 deal

OREANDA-NEWS. Growing geopolitical competition among nations is likely to weaken the chances of a strong global climate deal being agreed at this year's Paris summit, according to the World Economic Forum (WEF).

Rising nationalist sentiment and declining trust among global participants are undermining the international community's ability to act decisively on issues such as climate change, the WEF said in its Global Risks 2015 report, released today.

"The frozen relationship between Russia and the West seems to be transporting the world back to a time when geopolitics took primacy," the report said. Revelations about data fraud and leaks as well as cyber espionage have critically undermined global trust, it said.

Multi-stakeholder collaboration is one of the most effective ways to address global risks and build resilience, but co-operation is being undermined by a resurgence of interlinked economic and geopolitical power plays, the WEF said. Failing to implement common solutions in areas such as climate change could significantly undermine future global growth, it said.

The WEF's annual report analyses the top risks faced by the world over the next 10 years. It is based on a survey of around 900 business, academia and public sector leaders, conducted in July-September 2014.

"A serious breakthrough in the environmental negotiations requires trust because countries have to do something together at a cost," WEF managing board managing director Espen Barth Eide said at the launch of the report. Geo-strategic competition takes away that trust, he said.

The recent oil price decline further diminishes the prospect for a strong global climate deal because it increases the relative cost of alternative energy, which will undermine recent attempts to shift from fossil fuels to renewables, Eide said.

The WEF report identified interstate conflict with regional consequences as the top global risk over the next 10 years in terms of likelihood — and the fourth most serious in terms of impact.

More environmental risks are cited as among the top risks than economic ones, reflecting respondents' perception that existing preparations to cope with climate change and extreme weather are woefully inadequate.

Three of the 10 global risks most likely to materialise over the next decade are environmental, with extreme weather events rated as second only to interstate conflict, according to the WEF. Failure of climate-change adaptation is rated as seventh most likely, while water crises comes eight.

But in terms of impact, looming water crises are seen as the top risk, with the failure of climate-change adaptation assigned fifth place. Biodiversity loss and ecosystem collapse are rated as having the tenth most severe repercussions.

Climate change's expected negative impact on the ability to grow food and access water could prompt sudden and uncontrolled population migrations, the report pointed out. The number of refugees worldwide from environmental or conflict-related causes reached its highest level last year since World War 2.

The US National Intelligence Council identified the nexus of food, water, energy and climate change as one of four overarching "megatrends" that will shape the world in 2030. WEF survey respondents perceived these megatrends to be related also to other risks, including large-scale involuntary migration.

Major biodiversity loss and ecosystem collapse was assessed as high impact by respondents, but below average in terms of likelihood, which seems to reflect a misperception. The World Bank estimates that 75pc of the world's poor, or 870mn people, make a living from ecosystems, including tourism and the goods they produce, while 350mn are affected by the loss of coral reefs.

"Increasingly, decision makers are realising that biodiversity loss is not a second-order issue but is intricately linked to economic development, food challenges and water security," the WEF report said.

Climate change is already manifesting in rising sea levels, receding glaciers, warmer oceans and the increasing frequency of weather extremes. And yet governments and businesses remain woefully underprepared, because they exercise reactive risk-management rather than a preventative and proactive strategy, the report said.

On a more hopeful note, the coming year offers the international community unprecedented opportunities for much-needed collective action to address key global risks such as climate change, the report said. This year's UN Framework Convention on Climate Change (UNFCCC) conference in Paris, France, alongside other global summits on disaster risk reduction and finance for sustainable development, is "a once-in-a-generation opportunity" to align climate change with these other goals,the WEF said.

If governments could find common ground on these issues, it would encourage sustainable growth and poverty reduction by catalysing private-sector finance and scaling low-carbon investment, according to the WEF.

But if they continue to value narrow short-term concerns above the prospect of longer-term global prosperity and environmental security, the opportunity will be missed. "More vulnerable populations will be consigned to the negative spiral of poverty and environmental degradation," the report said.

So 2015 offers an opportunity the world cannot afford to miss, the WEF concluded.