Why the current COVID crisis is terrible news
In my bare opinion the current crisis is terrible news for the fight against climate change, for (at least) the following reasons:
1 - There has been no concerted, "global" management of the virus spread. Up until 1.5 weeks ago (or less) each government was pushing forward a different, nationalistic narrative on how to handle the health and economic emergency. This would probably be applicable - as it has been until now - to the fight against global warming and (more generally) the pernicious effects of climate change. Even the Paris Agreement now looks more like a vague agenda than an operational toolset of policies to be applied and actions to be taken, and I would imagine more countries renegating their commitments and withdrawing from the Agreement in the upcoming future...
2 - This is also because, when the health crisis will be over, no political leader would dare to impose his/her citizens a "green renaissance" agenda. Massive unemployment, booming bankruptcies, depression and stagnation risks will demand for economic growth, whatever it takes. Production will have to restart, and quickly. Cheap oil might do the rest.
3 - Even those players (businesses, governments, wanna-be entrepreneurs) willing to invest in the green economy (here cheap oil might send powerful signals for the future, hopefully...) will probably crash against a massive cleantech credit crunch. Investors will have prorompent incentives to buy discounted assets; the ESG/Sustainable Finance movement will fall short of demonstrating some sort of resilience against financial crises (not entirely because of asset managers' fault); philanthropic/development and other non profit institutions will have plenty of targets to invest on, thus diluting the ESG paradigm.
4 - Some players will definitely increase their market share and long-term stability, by becoming the reference points of their industries (e.g. Tesla, Orsted among the others). This, however, risks of further stifling competition because of a mounting risk aversion and the objective toughness/regulatory impossibility of competing with these companies.
5 - The NIMBY vision and other perception and behavioral fallacies (refer to Kahneman on this) will postpone the perceived urgency of the CC issue. Local and global civil society activist groups will raise their voices. Nonetheless, it will be a scream surrounded by a cacophonic orchestra of other stakeholder groups (e.g. trade unions, corporates...) demanding for more resources, with more pressing arguments. Good luck on that.
Again, global leaders with a long-term, collective welfare vision are badly needed.
Co-founder & CEO @ Vitesy
4 年Interesting point of view Alessandro - perhaps what could drive the change could be a more bottom-up approach rather than top-down. Always optimistic in having faith in people! Cheers!
Climate Policy, Carbon Markets, Climate Finance, Net Zero and Decarbonization Strategies.
4 年True, I believe the crisis shown us why we need to act together and forget growing nationalism etc. Also In regards to fighting climate change it is golden opportunity to move towards a low carbon economy but my fear is it will go on an overdrive and this period will be shot-lived. https://www.aa.com.tr/en/environment/qatar-covid-19-affects-green-campaigns-but-cannot-stop/1771711