Governments cannot afford climate change projects

21st November 2011

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  • Mitigation ,
  • Central government



Some of the world's biggest economies are not maintaining their investment in tackling climate change due to financial pressures, warns Ernst & Young in the run up to international talks in Durban.

According to an analysis of 10 of the world’s leading economies, governments including the UK, the US and France are spending billions of dollars less than they were before the financial crisis, resulting in a considerable funding gap.

In its report “Durban dynamics: navigating for progress on climate change”, the accountancy firm estimates that, in comparison to spending patterns between 1990-2010, the governments will be spending $22.5 billion less each year on mitigating climate change by 2015.

Furthermore, if the economic crisis engulfing the Eurozone deepens the funding gap will double to $45 billion a year, the research concludes.

“Policymakers head to Durban under storm clouds of fiscal austerity…The enormous projected funding gap revealed by this report suggests continuing economic uncertainty is pushing a low carbon economy further out of reach,” warned Juan Costa Climent, global climate change and sustainability services leader at Ernst & Young.

Ahead of the Durban talks, the report also highlights worries in the private sector that a global agreement is out of politicians’ reach. Of the 300 executives surveyed for the research, 83% agreed a multilateral agreement is needed to tackle climate change, but only 18% said they thought a deal was likely to emerge.

More than three-quarters of the respondents said they felt their government had not been investing enough in a low-carbon economy, while 44% confirmed their firm had increased its investment in sustainability in the last 12 months.

The Ernst & Young research was followed by claims reported in the Guardian that most of the world's leading economies agree that no new global agreement will be reached before 2016. Meanwhile, the Intergovernmental Panel on Climate Change issued research confirming that manmade climate change will result in more extreme weather conditions including heavier rainfall, stronger tropical storms and hotter days.

"For the high emissions scenario, it is likely that the frequency of hot days will increase by a factor of 10 in most regions of the world", confirmed Thomas Stocker co-chair of the IPPC’s Working Group I.

The UN climate change conference 2011 in Durban takes place between 28 November and 9 December.


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