Global warming tougher than GFC
It will be harder to provide a solution to global warming than dealing with the global financial crisis.
University of Melbourne professor of economics Ross Garnaut told an Australian Institute of Superannuation Trustees breakfast in Melbourne that global warming needed a global solution.
“We won’t have a solution (to global warming) unless the developed countries make concessions,” he said.
“We can’t make things happen working in isolation, but global agreement in this area is very difficult.”
Garnaut said the danger was some countries would do nothing, allowing developed economies to endure all the pain of cutting emissions.
“To get lower emissions you have to have global agreement by all countries,” he said.
“And that agreement has to be a cut of at least 25 per cent, possibly by 2050.”
While Australia and the US have now come onboard for cutting emissions, there will still be problems in the developing world, Garnaut said.
Some of these countries will resist being told what to do in relation to cutting emissions for fear of harming their local economies.
The professor said China will find its own way of cutting emissions and may not sign up to a global initiative, despite possibly meeting a lot of the points in any formal communiqué.
“China will go its own way on cutting emissions,” Garnaut said.
“It has started detailing how it will reduce emissions by 4 per cent per annum." He said the country was putting a lot of money into developing alternative energy sources, such as solar and wind power, but China still had the world’s biggest coal mining program.
“There is a long way to go before China balances its energy programs,” Garnaut said.
The problems of developing countries meeting their industrial energy demands with green power will require funding, and the developed nations will be expected to help.
“We will have to talk about entitlements to emissions with these countries,” he said.
“If we do hold every country to their entitlements, we will do a lot better getting global agreements.”
Recommended for you
Digital advice tools are on the rise, but licensees will need to ensure they still meet adviser obligations or potentially risk a class action if clients lose money from a rogue algorithm.
Shaw and Partners has merged with Sydney wealth manager Kennedy Partners Wealth, while Ord Minnett has hired a private wealth adviser from Morgan Stanley.
Australian investors are more confident than their APAC peers in reaching their financial goals and are targeting annual gains of more than 10 per cent, according to Fidelity International.
Zenith Investment Partners has lost its head of portfolio solutions Steven Tang after 17 years with the firm, the latest in a series of senior exits from the research house.
