“We are all in this together” this is how “John Kerry” (Special Presidential Envoy for Climate Change) described the climate change crisis in one of his many speeches addressing the COP27 summit held in Sharm el-Sheikh this month in Egypt. He was right, nobody can claim otherwise. We are all in this together in the sunset of the industrial revolution, where the only harvest remaining is the suffering planet, and the sum of USD 7 trillion is required every year to cool down the climate and barely restore the increasing temperature to 1.5 C above the average temperature prevailed in the dawn of the first industrial revolution.
Towards Fair and Equitable Greener Economies
“It is quite unfair to ask the developing and least developed countries, that were subject to centuries of oppression while struggling for their independence, to bear the same amount of commitments promised by the developed first world countries, who managed to drain the planet's resources and damage its atmosphere for as long as they existed.” This is how I commented on Mr. Kerry’s statement, during my participation in the decarburization day at the COP27, a few minutes from his eloquent speech.
Since the COP26 summit held last year in Glasgow, a gentle, yet obvious split between developed and LDCs has defined their contributions to the various commitments towards the global crisis. This split came on the back of the idea of the fair distribution of costs versus rewards accumulated unevenly in the northern part of the world. While the south poor and deprived part is crossing the same road of agony, naked of any resources.
The vibes of the COP26 were still present in the COP27, along with shadows of the failure of the Paris Convention, which failed dramatically to achieve its main goal of cooling off the planet. The failure is shamefully attributed to the lack of will, finance, and the withdrawal of Trump’s administration from the convention. Containing climate change is very costly. It needs funds to adjust to lesser carbon emissions, and make technology, lifestyle, and mindset greener in many ways.
I remember at the COP22 summit held in Marrakech 2016, some of the participants were bragging about having USD 100 billion pledged to stop global warming. Participants were keen to accuse financial markets of being lazy in unlocking these outstanding funds, by regulating green products markets and help to introduce new financial instruments and platforms that can turn these “generous” pledges into reality. This was history, the challenges nowadays are more severe and the efforts should be all summoned to save the planet from imminent danger.
The Balance between Sustainability and Survival
One does not have to look very far in history to understand the viewpoint of developing countries while dealing less seriously with the climate change crisis. You should only get familiar with Maslow’s pyramid of needs, and have a swift look at modern Europe today, in the middle of the Russian-Ukrainian conflict. A single shock in the natural gas supply forced great western nations to take contingency measures to postpone their plans for energy transition (Germany is an example). Emerging countries are not immune to the effect of these recent shocks; they are in the eye of the storm, among other pains of poverty, hunger, and climate change drawbacks.
Developing countries are in the takeoff phase on their development runway. They are simply still "DEVELOPING" and growing steadily! They need the power to survive and energy to feed this goal of basic survival. Coal, fossil oil, and its derivatives are the main source of energy to the manufacturing sector in this world (especially the heavy consumers of energy). Switching to solar, wind, and other renewable sources like green hydrogen is not easy.
The steel industry is responsible for 5% of the global annual carbon emissions. Almost 75% of the global demand for coal (as a source of energy) comes from the steel industry, mostly from blast furnaces, which produce no less than 70% of the global steel production. Egypt (the most populous country in the MENA region) has shut down its last large blast furnace that was barely operating in the Egyptian iron and steel company two years ago. Consequently, Egypt liquidated the firm and the sole vertically integrated Coke-producing firm in Helwan (the area that was once a healing destination, for what it contained from sulfur water springs). As a result, out of the 2 billion tons of steel consumed globally every year, mostly by emerging and developing countries, the slim contribution of Egypt (only 8 million tons a year) has a lower carbon footprint than most of the competitors everywhere else. It is worth mentioning that Egypt is only responsible for 0.6% of the carbon emissions in the world, despite its 104 million consumers and the ambitious 7% targeted growth rate, necessary to keep the country breathing.
Climate Change Risks in the MENA Region
According to the Intergovernmental Panel on Climate Change (IPCC), global average rainfall has reached new record lows over the last three decades. The panel stated in 2014 that human security will be progressively threatened as temperature increases, and has re-asserted the threat of climate-induced conflicts in its 2022 report.
In the Middle East, water scarcity is already a problem. The region is home to 12 out of the world’s 17 most “water-stressed countries” according to the World Resources Institute. The World Bank estimates that climate-related water scarcity will cost Middle Eastern nations between 6 percent and 14 percent of their GDP by 2050, due to water-related impacts on agriculture, health, and incomes.
Climate change threatens every country in the MENA region. Aid groups have warned more than 12 million people in Iraq and Syria are losing access to water, food, and electricity because of rising temperatures and record-low rainfall. Desertification is extensive across the region in Iraq, Syria, Jordan, and Iran. The cost of water in Jordan has increased by 30 percent over the past decade because of the lack of groundwater.
This gives increasing importance to the next COP28 summit that will be held in the UAE. The focus will remain on the MENA region as a host destination and the top suffering nations from climate change. The COP28 shall give more attention to actions rather than pledges, in light of more realistic goals rather than dreams.
Some Climate Change Externalities
Climate change can have a dilapidating impact on security and the fabric of societies by inflaming socioeconomic fractures and eroding the trust in public institutions. The problem is best summed up as interconnected crises that combine to create a domino effect of problems at the local, national, and geopolitical levels. This starts with weakened state institutions and ends with ungoverned spaces in which armed groups and criminal enterprises thrive, prompting the internal displacement of populations and a flee of refugees, that ensures no country in the region and beyond is safe.
Water scarcity and poverty force people to migrate to populous towns and cities seeking jobs, which imposes further costs and pressures on the over-burdened infrastructure. The link between climate crises and social unrest as a result of climate migration has long been established. The drought produced unprecedented poverty, paving the way for migration to the peripheries of Syria’s main cities, which were already burdened by population growth. The influx of refugees and the resulting pressure on poor infrastructure established the deep-rooted grievances that were central to the 2011 uprising.
Steps towards the Way Out
The economist magazine mentioned lately that the USD 1 trillion promised every year for achieving 1.5 Celsius degrees to cool down global warming or to neutralize carbon emissions, is no more realistic, and should be multiplied by three.
Unlocking such huge investments is not an easy task and the rich countries ( governments and private sector entities) along with multilateral entities should be all working together to decarbonize old technologies using the proper means of transition.
Grants and concessional loans should be extended to developing countries to help them decarbonize their industries. Responsible investors must oversubscribe to financial products such as green bonds and green Sukuk issued by these countries to finance that purpose, as part of the moral imperative.
Carbon credit should be regulated to become widely tradable. Rich countries should grant carbon credits to heavy industries in the south, helping them to transfer safely to green producers.
Decarbonized products and those with carbon credit granted to them, should be duly incentivized in the global markets.
In addition to that, a special purpose fund for energy transition should be established in the MENA region, with the participation of the main carbon producers in the world, and this fund shall be one of the products of COP27.
