John Kerry says ‘we need to ask even more’ of financial institutions on climate change
John Kerry, the U.S. climate ambassador, stated Tuesday that to reach carbon emission goals, there must be an increase in green energy investments or a drastic reduction in fossil fuel investments.
Kerry spoke to an audience at the Council on Foreign Relations. Kerry stated that he was “absolutely certain” that the world would transition to a low-carbon, or no-carbon economy. However, he worries that it won’t happen before it is too late. He stated that financial institutions must get involved.
Kerry stated, “Business as usual…is simply not an option.”
“For every dollar that is invested in low-carbon energy supplies, $1.10 goes into fossil fuels. Kerry said, “Go figure!” “The science and math clearly show that we can’t achieve our targets unless we drastically change this ratio.”
Biden’s administration has set a goal to reduce net greenhouse gas emissions by 50-52% from 2005 levels by 2030. They also aim to reach net-zero emissions in 2050. The goal of the European Union is to reduce greenhouse gas emissions by at least 55% from 1990 levels by 2030.
Kerry stated that climate change is an “existential problem” and that no one country can fix it. He stated that governments cannot solve the problem on their own, and therefore, it is important to have support from both public and private institutions.
Kerry stated that part of what is needed is for the “private sector financial institution to recognize and manage the financial risks of a chaotic, disorderly, but inevitable transition towards net-zero.”
Kerry stated that climate change is a great investment opportunity. However, he warned that not adequately responding to the threat of climate change could cause a disruption in the market.
Kerry also mentioned multilateral development banks, which are institutions that work with borrower and donor countries to aid developing nations in building their economies and reducing poverty.
Kerry stated that MDBs historically have helped to address issues like famines and pandemics and that they should continue to do so in the face of “more frequent and more severe climate-related catastrophes.”
He stated that MDBs must “scale up financing for adaptation and resilience” and assist countries such as Pakistan in obtaining resources after disasters.
He said, “Yes, we are asking a lot from these institutions.” “But that’s why they’re there.”
Kerry’s comments were part of a preparation for the COP27 climate conference, Sharm el-Sheikh (Egypt), in November.