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The Middle East moves towards a Smart Cities Future

The Middle East moves towards a Smart Cities Future

In a Press Release, CommScope Reveals Connectivity Trends During GITEX. GITEX is one of the largest regional IT exhibitions and conferences in the MENA and South Asia region that takes place annually in Dubai, the United Arab Emirates at the Dubai World Trade Centre. It was held that the Middle East moves toward a smart cities future.

DUBAI, UNITED ARAB EMIRATES – As data connectivity is becoming the Fourth Utility in cities across the Middle East, businesses and homes across the region are rushing to implement it.  The region is prioritizing innovative technologies that pave the way for the future of smart cities as network operators start the commercial rollout of 5G.

“The Middle East is focused on high speeds, low latency and building connections that support smart city transformation,” said Ehab Kanary, vice president of Enterprise, CommScope.  “With the acquisition of ARRIS and Ruckus Networks, CommScope has the resources of a Fortune 250-sized company that is well placed to drive the future of connectivity in the region.”

Below are three trends that will impact smart cities in the Middle East:

  • City planners must continue to make investments for the long term: Governments in the region are playing a key role in leading and funding smart city projects. City planners must continue to educate themselves about the future possibilities of – and requirements for – smart city infrastructure, consulting with IoT vendors and network connectivity vendors, and working to develop a plan for the long term.
  • Governments and the private sector must join forces: Connectivity is the basic requirement for smart cities, and fiber-fed 5G wireless is the infrastructure that will make it possible. But to enable 5G universally, cities and service providers will have to work together. Shared infrastructure makes 5G a viable business model for both cities and service providers. 
  • As 5G technology spreads, cities will leverage it to become “smarter”: Most people think of 5G as a new wireless service for faster smartphones, but it is also a medium that enables a city to become smarter. Citizens and visitors will demand virtual reality, augmented reality and autonomous vehicle applications also be integrated into city services and capabilities.  In the near future, countries in the Middle East are engaged in projects aimed at improving public services, security and quality of life.

During GITEX Technology Week 2019, CommScope will highlight its latest solutions to enable a smart future for network operators across the region:

  • Fiber for High-Speed and Robust Connectivity: Smart cities will be built on fiber. CommScope will be demonstrating fiber technologies for faster connectivity in buildings, the data center and central office.
  • Ultra-Connected Homes are Becoming a Reality: Consumers are experiencing an increasingly digital life and network operators are seeking ways to unlock the best user experience. CommScope will demonstrate how the company is delivering reliable, high-bandwidth Wi-Fi to every corner of the home and showcase how the smart media device brings connected home technologies together for a unique personalized experience. 
  • Powering Connectivity for Smart Cities: As smart cities add new mobile-connected devices like security cameras and air quality sensors, they must have access to electricity. This is not always an easy task considering devices may be several hundred meters away from a power source. Network operators are using CommScope’s powered fiber cable systems to speed and simplify installation, and power these types of network devices.
  • Digital foundation for Smarter Buildings: As the number of connected devices grows, the location of these devices is becoming more important. CommScope’s automated infrastructure management (AIM) system knows exactly what is connected, how it is connected and where it is located.  The software automatically tracks changes, issues work orders and documents the entire network. It also provides root-cause analysis in the event of failure, helping restore services faster.

Journalists are invited to learn more about these trends and technologies from CommScope’s experts in Hall 7, Stand H7-D43, taking place in Dubai on October 6-10, 2019.

About CommScope:

CommScope (NASDAQ: COMM) and the recently acquired ARRIS and Ruckus Networks are redefining tomorrow by shaping the future of wired and wireless communications. Our combined global team of employees, innovators and technologists have empowered customers in all regions of the world to anticipate what’s next and push the boundaries of what’s possible. Discover more at www.commscope.com.

News Media Contact:
Komal Mishra
+971 43602440
Komal@activedmc.com

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One of the Four Corners of the Arabian Peninsula

One of the Four Corners of the Arabian Peninsula

Despite or in spite of the far from peaceful happenings in one of the four corners of the Arabian peninsula, life carries on unperturbed elsewhere and the following is about what is happening in the opposite corner, i.e.:

One of the Four Corners of the Arabian Peninsula
Energy transition the buzzword, but a fossil future from the Gulf by ET Energy World

Energy ‘transition’ the buzzword, but a fossil future for the Gulf.

ABU DHABI, September 15, 2019  — In the vast air-conditioned halls of an Abu Dhabi conference centre, the world’s much-vaunted transition to clean energy is the buzzword in sessions of a top industry gathering.

But many executives and officials from oil-dependent Gulf states insist that while the change to renewables is essential, fossil fuels remain the future at least for the next few decades, despite the urgent need to fight climate change.

The debate has taken centre stage at this week’s World Energy Congress, with many officials calling for accelerating the process of moving to clean power sources and minimising carbon emissions.

Speakers addressed issues like the role of nuclear, hydrogen gas and other non-conventional sources of energy as a replacement for fossil fuels which currently account for over three-quarters of the world’s energy consumption.

However, delegates from oil-producing countries and particularly those in the Gulf argued that although the transition to clean energy sources must be supported, they will not be able to meet rising demand any time soon.

“For decades to come the world will still rely on oil and gas as the majority source of energy,” said the head of Abu Dhabi Oil Co. Jaber Sultan.

“About $11 trillion of investment in oil and gas is needed to keep up with current projected demand,” over the next two decades, he told the congress which was attended by representatives of 150 nations and over 400 CEOs.

Energy from increasingly competitive renewable sources has quadrupled globally in just a decade, but insatiable demand for energy particularly from developing economies saw power sector emissions rise 10 per cent, a UN report said last week. 

“All energy transitions — including this one — take decades, with many challenges along the road,” the CEO of Saudi energy giant Aramco, Amin Nasser, said at the conference.

Nasser said his country supports the growing contribution of alternatives, but criticised policies adopted by many governments that do not consider “the long-term nature of our business and the need for orderly transition”.

Addicted to oil 

Oil is still the lifeline for the Gulf states, contributing at least 70 per cent of national revenues across the region which has been cushioned by decades of immense profits from the flow of “black gold”.

Gulf nations have invested tens of billions of dollars in clean energy projects, mainly in solar and nuclear.

Dubai has launched the world’s largest solar energy project, with a price tag of $13.6 billion and the capacity to satisfy a quarter of the energy-hungry emirate’s current needs when it comes online in 2030.

But critics say the addiction to oil is a tough one to kick, particularly when supplies remain abundant and the massive investment in infrastructure necessary to switch to renewables is daunting.

“A global shift from dirty fossil fuel to renewable energy is economically, technically and technologically feasible… All that is missing is political will!” said Julien Jreissati from Greenpeace in the Middle East.

He said while the United Arab Emirates has put plans into action, “Saudi Arabia which has always made big announcements regarding their renewable energy ambitions is lagging behind as their projects and targets remain ink on paper.’

“There is no doubt that the world will leave oil behind. The only question remaining is when will this happen?”

Despite important technological advances made in the past decade, renewable energy sources still make up just around 18 per cent and nuclear adds another 6 per cent of the world’s energy mix. 

In the past decade, the adoption of wind and solar energy picked up rapidly as the production cost plummeted to levels close to that of oil and gas.

But the Abu Dhabi conference saw calls for accelerated innovation and “disruptive” technology to speed the transition as the world prepares for global energy demand to peak between 2020 and 2025, according to the World Energy Council.

Estonian President Kersti Kaljulaid said that sustainable and environmentally friendly energy practices must be aligned with national and global economic policies in order to have the required impact.

“It makes more economic sense to apply all green technologies globally, and if this happens we might go to being CO2-free energy users 5 or 10 or 20 years quicker,” she told the conference.

“I prefer that market forces, pushed by smart policymaking and legal space-setting, act quickly and save us all from the alternative.”

Related: Barkindo: Concept of what ‘peak oil’ means has shifted

UN urges organic carbon conservation

UN urges organic carbon conservation

Global warming or climate change is threatening the fate of oases in the Sahara Desert as affected by the noticeable advancing sands along the edges of all habitable spaces in the MENA region.  With almost 90 per cent of its lands being arid and/or semi-arid, the region’s countries must be following the 14th edition of the COP on the fight against desertification. This being held in New Delhi, India, from 2 September through to 13 September, the UN urges soil organic carbon conservation to fight desertification whereby UNCCD’s member countries must proactively prevent land degradation reports Ranjit Devraj in this article below.

UN urges organic carbon conservation
MENA climate map – pinterest.com

[NEW DELHI] Soil organic carbon (SOC) must be proactively conserved to prevent land degradation, says a science-policy interface report released at the 14th Conference of the Parties (CoP14) of the United Nations Convention to Combat Desertification (UNCCD) ongoing (2–13 September) in the Indian capital.

According to the UNCCD, 70 per cent of the world’s forests are now threatened by conversion to cropland and urbanisation — processes that greatly deplete SOC, a measurable component of soil organic matter and key to soil productivity. Particularly at risk are tropical forests, which declined at the rate of 5.5 million hectares annually between 2010 and 2015. 

“This report will help member countries of the Convention identify sustainable land management technologies that are context-specific and also help estimate and monitor SOC for achieving land degradation neutrality and other sustainable development goals (SDGs),” Barron Joseph Orr, lead scientist for the UNCCD, tells SciDev.Net. 

“The UNCCD report on SOC is especially important for South Asia because [of] its many and varied agro-climatic zones, each requiring specific interventions to prevent loss of SOC and retain moisture in the soil to nourish vegetation roots”

Himanshu Thakkar, South Asia Network on Dams, Rivers and People

SOC, according to Orr, has direct relevance to all three Rio conventions: the UNCCD, the Convention on Biological Diversity and the UN Framework Convention on Climate Change
An important component of the global carbon cycle, SOC brings multiple co-benefits which support not only the SDG on building a land degradation-neutral world but also the SDGs on achieving zero hunger, good health and sanitation, climate action and gender equality.

“Because of its multifunctional roles and its sensitivity to land management, SOC is one of the three main global indicators of land degradation neutrality, the other two being land cover and land productivity,” says Ermias Aynekulu, an author of the report. “SOC, made up largely of decomposing animal and plant matter, is key to drought resistance, soil stability and organic crop production.”

The report proposes to encourage parties to the UNCCD to employ sustainable land management technologies to maintain or increase SOC, align SOC monitoring with national land degradation neutrality monitoring and share the guidance offered with farmers and other land managers. 

According to the report, the management of SOC to support land degradation neutrality achievement will be most effective if it promotes the following: gender equality and inclusive development, empowerment of women to invest in natural resources, and capacity building of local institutions.

Emphasis is laid on an accurate assessment of SOC since national capacities to measure and monitor are highly variable. It proposes that efforts be made to enhance the capacity of countries for spatio-temporal measurement and modelling of SOC to address data gaps and limitations in tools and models currently being used.

A spatio-temporal study carried out by EnvirometriX Ltd, Wageningen, the Netherlands, indicates that the greatest loss of SOC over the 2000–2015 period took place in the northern hemisphere followed by Brazil, Central Africa and Indonesia, where large swathes of natural forests have been converted to croplands.

A science policy brief accompanying the report offers ‘decision trees’ to guide efforts to predict change in SOC under different land management practices. It also seeks to support decision-makers to pursue the right interventions in the “right locations at the right time and at the right scale” with the overall goal of land degradation neutrality achievement.

According to Marioldy Sanchez Santivañez, an observer to the UNCCD science-policy interface and forest evaluator for AIDER, a Peruvian NGO, developing and reinforcing capacities for soil sampling and implementing measurement and monitoring, as outlined in the report, “has the potential to contribute greatly to restoring soil carbon in many of the world’s land-degraded areas”. 

Among the simple tools now available to evaluate SOC is the open-access Soil Organic Carbon App  developed by researchers at the International Center for Tropical Agriculture. The app can determine the amount of sequestered SOC and also assess the impact of good conservation practices over time.

Himanshu Thakkar, coordinator of the South Asia Network on Dams, Rivers and People, a Delhi-based NGO, says that retaining SOC is vital for South Asia, a peninsula which is estimated to lose 80 per cent of the rainfall it receives to the sea, leaching away valuable organic carbon and contributing greatly to desertification. “This is an area that [needs] urgent attention since more than 30 per cent of the landmass is now degraded.”

The Indian sub-continent is particularly vulnerable. A study published in May by Science Direct said at least a third of the area around 18 river basins of the Indian sub-continent have become vulnerable to ‘vegetation droughts’, indicating drastic loss of soil moisture.

“The UNCCD report on SOC is especially important for South Asia because [of] its many and varied agro-climatic zones, each requiring specific interventions to prevent loss of SOC and retain moisture in the soil to nourish vegetation roots,” Thakkar tells SciDev.Net. “All that remains is for the governments to pick up the detailed guidelines and decision trees in the report and follow them.”   

This piece was produced by SciDev.Net’s Asia & Pacific desk.

Related topics

Oman is the most improved nation in MENA

Oman is the most improved nation in MENA

Oman is the most improved nation in MENA, moving up eight places to 58th, in the Travel & Tourism Competitiveness Index (TTCI) 2019 prepared by the World Economic Forum (WEF).

Oman most improved nation in MENA in WEF’s Travel and Tourism Survey is an article of the Muscat Daily of September 7, 2019.

Oman is the most improved nation in MENA

Conducted biennially, the survey found that Oman is MENA’s safest country and overall third in the world. Oman ranks third in safety and security due to lower homicides rates (19th in the world), a reliable police force (5th), and low costs of terrorism (7th) and crime (3rd).

Oman also recorded the region’s fastest improvement for its human resources and labour markets (103rd to 65th) and is among the most improved in international openness (116th to 97th), environmental sustainability (109th to 57th) and overall infrastructure (60th to 52nd).

The top 10 countries this year are Spain, France, Germany, Japan, the United States, the United Kingdom, Australia, Italy, Canada and Switzerland. India (40th to 34th) had the greatest improvement over 2017 among the top 25 per cent of all countries ranked in the report.

The Middle East and North Africa (MENA) region significantly improved its T&T competitiveness since the last edition of the TTCI. ‘With 12 of the 15 MENA economies covered by this year’s index increasing their score compared to 2017, the region was able to slightly outpace the global average in competitiveness growth. This is particularly important given that, in the aggregate, T&T accounts for a greater share of regional GDP than in any of the other four regions,’ stated the report.

Consequently, it is no surprise that the Middle East scores above the global and regional averages on indicators related to enabling environment and infrastructure, with particularly high ranks on ICT readiness and business environment. Nevertheless, the subregion does trail the world and North Africa on T&T prioritisation and policy and natural and cultural resources.

This year, eight out of the Middle East’s 11 members improved their TTCI score since 2017. In contrast, the UAE had the Middle East’s largest decline, falling from 29th to 33rd, including the biggest percentage decline in score on the Safety and Security pillar (falling from 2nd to 7th) and Ground and Port Infrastructure (19th to 31st) and the subregion’s only decline on Environmental Sustainability (40th to 41st).

Nevertheless, the country remains in the lead in the Middle East and is MENA’s top TTCI scorer, leading on ICT readiness (4th), air transport (4th) and tourist service infrastructure (22nd).

Each country receives a score in categories from business environment, safety and security, health and hygiene, human resources and labour market and ICT readiness.

A globalised solar-powered future is wholly unrealistic

A globalised solar-powered future is wholly unrealistic

A globalised solar-powered future is wholly unrealistic – and our economy is the reason why is elaborated on by Alf Hornborg, Professor of Human Ecology at Lund University.

Over the past two centuries, millions of dedicated people – revolutionaries, activists, politicians, and theorists – have been unable to curb the disastrous and increasingly globalised trajectory of economic polarisation and ecological degradation. This is perhaps because we are utterly trapped in flawed ways of thinking about technology and economy – as the current discourse on climate change shows.

Rising greenhouse gas emissions are not just generating climate change. They are giving more and more of us climate anxiety. Doomsday scenarios are capturing the headlines at an accelerating rate. Scientists from all over the world tell us that emissions in ten years must be half of what they were ten years ago, or we face apocalypse. Schoolchildren like Greta Thunberg and activist movements like Extinction Rebellion are demanding that we panic. And rightly so. But what should we do to avoid disaster?

Most scientists, politicians, and business leaders tend to put their hope in technological progress. Regardless of ideology, there is a widespread expectation that new technologies will replace fossil fuels by harnessing renewable energy such as solar and wind. Many also trust that there will be technologies for removing carbon dioxide from the atmosphere and for “geoengineering” the Earth’s climate. The common denominator in these visions is the faith that we can save modern civilisation if we shift to new technologies. But “technology” is not a magic wand. It requires a lot of money, which means claims on labour and resources from other areas. We tend to forget this crucial fact.


Read more: Should we engineer the climate? A social scientist and natural scientist discuss


I would argue that the way we take conventional “all-purpose” money for granted is the main reason why we have not understood how advanced technologies are dependent on the appropriation of labour and resources from elsewhere. In making it possible to exchange almost anything – human time, gadgets, ecosystems, whatever – for anything else on the market, people are constantly looking for the best deals, which ultimately means promoting the lowest wages and the cheapest resources in the global South.

It is the logic of money that has created the utterly unsustainable and growth-hungry global society that exists today. To get our globalised economy to respect natural limits, we must set limits to what can be exchanged. Unfortunately, it seems increasingly probable that we shall have to experience something closer to disaster – such as a semi-global harvest failure – before we are prepared to seriously question how money and markets are currently designed.


This article is part of Conversation Insights
The Insights team generates long-form journalism derived from interdisciplinary research. The team is working with academics from different backgrounds who have been engaged in projects aimed at tackling societal and scientific challenges.


Green growth?

Take the ultimate issue we are facing: whether our modern, global, and growing economy can be powered by renewable energy. Among most champions of sustainability, such as advocates of a Green New Deal, there is an unshakeable conviction that the problem of climate change can be solved by engineers.

What generally divides ideological positions is not the faith in technology as such, but which technical solutions to choose, and whether they will require major political change. Those who remain sceptical to the promises of technology – such as advocates of radical downshifting or degrowth – tend to be marginalised from politics and the media. So far, any politician who seriously advocates degrowth is not likely to have a future in politics.

Mainstream optimism about technology is often referred to as ecomodernism. The Ecomodernist Manifesto, a concise statement of this approach published in 2015, asks us to embrace technological progress, which will give us “a good, or even great, Anthropocene”. It argues that the progress of technology has “decoupled” us from the natural world and should be allowed to continue to do so in order to allow the “rewilding” of nature. The growth of cities, industrial agriculture, and nuclear power, it claims, illustrate such decoupling. As if these phenomena did not have ecological footprints beyond their own boundaries.


Read more: An ecomodernist’s manifesto: save wildlife by embracing new tech


Meanwhile, calls for a Green New Deal have been voiced for more than a decade, but in February 2019 it took the form of a resolution to the American House of Representatives. Central to its vision is a large-scale shift to renewable energy sources and massive investments in new infrastructure. This would enable further growth of the economy, it is argued.

A globalised solar-powered future is wholly unrealistic
What will it take for us to seriously consider the roots of our problems? PicsEKa/Shutterstock

Rethinking technology

So the general consensus seems to be that the problem of climate change is just a question of replacing one energy technology with another. But a historical view reveals that the very idea of technology is inextricably intertwined with capital accumulation, unequal exchange and the idea of all-purpose money. And as such, it is not as easy to redesign as we like to think. Shifting the main energy technology is not just a matter of replacing infrastructure – it means transforming the economic world order.

In the 19th century, the industrial revolution gave us the notion that technological progress is simply human ingenuity applied to nature, and that it has nothing to do with the structure of world society. This is the mirror image of the economists’ illusion, that growth has nothing to do with nature and so does not need to reckon with natural limits. Rather than seeing that both technology and economy span the nature-society divide, engineering is thought of as dealing only with nature and economics as dealing only with society.

The steam engine, for instance, is simply considered an ingenious invention for harnessing the chemical energy of coal. I am not denying that this is the case, but steam technology in early industrial Britain was also contingent on capital accumulated on global markets. The steam-driven factories in Manchester would never have been built without the triangular Atlantic trade in slaves, raw cotton, and cotton textiles. Steam technology was not just a matter of ingenious engineering applied to nature – like all complex technology, it was also crucially dependent on global relations of exchange.

Sketch showing a steam engine designed by Boulton & Watt, England, 1784. Wikimedia Commons

This dependence of technology on global social relations is not just a matter of money. In quite a physical sense, the viability of the steam engine relied on the flows of human labour energy and other resources that had been invested in cotton fibre from South Carolina, in the US, coal from Wales and iron from Sweden. Modern technology, then, is a product of the metabolism of world society, not simply the result of uncovering “facts” of nature.

The illusion that we have suffered from since the industrial revolution is that technological change is simply a matter of engineering knowledge, regardless of the patterns of global material flows. This is particularly problematic in that it makes us blind to how such flows tend to be highly uneven.

This is not just true of the days of the British Empire. To this day, technologically advanced areas of the world are net importers of the resources that have been used as inputs in producing their technologies and other commodities, such as land, labour, materials, and energy. Technological progress and capital accumulation are two sides of the same coin. But the material asymmetries in world trade are invisible to mainstream economists, who focus exclusively on flows of money.


Read more: Decolonise science – time to end another imperial era


Ironically, this understanding of technology is not even recognised in Marxist theory, although it claims to be both materialist and committed to social justice. Marxist theory and politics tend toward what opponents refer to as a Promethean faith in technological progress. Its concern with justice focuses on the emancipation of the industrial worker, rather than on the global flows of resources that are embodied in the industrial machine.

This Marxist faith in the magic of technology occasionally takes extreme forms, as in the case of the biologist David Schwartzman, who does not hesitate to predict future human colonisation of the galaxy and Aaron Bastani, who anticipates mining asteroids. In his remarkable book Fully Automated Luxury Communism: A Manifesto, Bastani repeats a widespread claim about the cheapness of solar power that shows how deluded most of us are by the idea of technology.

Nature, he writes, “provides us with virtually free, limitless energy”. This was a frequently voiced conviction already in 1964, when the chemist Farrington Daniels proclaimed that the “most plentiful and cheapest energy is ours for the taking”. More than 50 years later, the dream persists.

The realities

Electricity globally represents about 19% of total energy use – the other major energy drains being transports and industry. In 2017, only 0.7% of global energy use derived from solar power and 1.9% from wind, while 85% relied on fossil fuels. As much as 90% of world energy use derives from fossil sources, and this share is actually increasing. So why is the long-anticipated transition to renewable energy not materialising?

One highly contested issue is the land requirements for harnessing renewable energy. Energy experts like David MacKay and Vaclav Smil have estimated that the “power density” – the watts of energy that can be harnessed per unit of land area – of renewable energy sources is so much lower than that of fossil fuels that to replace fossil with renewable energy would require vastly greater land areas for capturing energy.

In part because of this issue, visions of large-scale solar power projects have long referred to the good use to which they could put unproductive areas like the Sahara desert. But doubts about profitability have discouraged investments. A decade ago, for example, there was much talk about Desertec, a €400 billion project that crumbled as the major investors pulled out, one by one.

Today the world’s largest solar energy project is Ouarzazate Solar Power Station in Morocco. It covers about 25 square kilometres and has cost around US$9 billion to build. It is designed to provide around a million people with electricity, which means that another 35 such projects – that is, US$315 billion of investments – would be required merely to cater to the population of Morocco. We tend not to see that the enormous investments of capital needed for such massive infrastructural projects represent claims on resources elsewhere – they have huge footprints beyond our field of vision.

Also, we must consider whether solar is really carbon free. As Smil has shown for wind turbines and Storm van Leeuwen for nuclear power, the production, installation, and maintenance of any technological infrastructure remains critically dependent on fossil energy. Of course, it is easy to retort that until the transition has been made, solar panels are going to have to be produced by burning fossil fuels. But even if 100% of our electricity were renewable, it would not be able to propel global transports or cover the production of steel and cement for urban-industrial infrastructure.

And given the fact that the cheapening of solar panels in recent years to a significant extent is the result of shifting manufacture to Asia, we must ask ourselves whether European and American efforts to become sustainable should really be based on the global exploitation of low-wage labour, scarce resources and abused landscapes elsewhere.


Read more: Lithium is finite – but clean technology relies on such non-renewable resources


Collecting carbon

Solar power is not displacing fossil energy, only adding to it. And the pace of expansion of renewable energy capacity has stalled – it was about the same in 2018 as in 2017. Meanwhile, our global combustion of fossil fuels continues to rise, as do our carbon emissions. Because this trend seems unstoppable, many hope to see extensive use of technologies for capturing and removing the carbon from the emissions of power plants and factories.

Carbon Capture and Storage (CCS) remains an essential component of the 2016 Paris Agreement on climate change. But to envisage such technologies as economically accessible at a global scale is clearly unrealistic.

To collect the atoms of carbon dispersed by the global combustion of fossil fuels would be as energy-demanding and economically unfeasible as it would be to try to collect the molecules of rubber from car tires that are continuously being dispersed in the atmosphere by road friction.

The late economist Nicholas Georgescu-Roegen used this example to show that economic processes inevitably lead to entropy – that is, an increase in physical disorder and loss of productive potential. In not grasping the implications of this fact, we continue to imagine some miraculous new technology that will reverse the Law of Entropy.

Economic “value” is a cultural idea. An implication of the Law of Entropy is that productive potential in nature – the force of energy or the quality of materials – is systematically lost as value is being produced. This perspective turns our economic worldview upside down. Value is measured in money, and money shapes the way we think about value. Economists are right in that value should be defined in terms of human preferences, rather than inputs of labour or resources, but the result is that the more value we produce, the more inexpensive labour, energy and other resources are required. To curb the relentless growth of value – at the expense of the biosphere and the global poor – we must create an economy that can restrain itself.

The evils of capitalism

Much of the discussion on climate change suggests that we are on a battlefield, confronting evil people who want to obstruct our path to an ecological civilisation. But the concept of capitalism tends to mystify how we are all caught in a game defined by the logic of our own constructions – as if there was an abstract “system” and its morally despicable proponents to blame. Rather than see the very design of the money game as the real antagonist, our call to arms tends to be directed at the players who have had best luck with the dice.

I would instead argue that the ultimate obstruction is not a question of human morality but of our common faith in what Marx called “money fetishism”. We collectively delegate responsibility for our future to a mindless human invention – what Karl Polanyi called all-purpose money, the peculiar idea that anything can be exchanged for anything else. The aggregate logic of this relatively recent idea is precisely what is usually called “capitalism”. It defines the strategies of corporations, politicians, and citizens alike.

All want their money assets to grow. The logic of the global money game obviously does not provide enough incentives to invest in renewables. It generates greed, obscene and rising inequalities, violence, and environmental degradation, including climate change. But mainstream economics appears to have more faith in setting this logic free than ever. Given the way the economy is now organised, it does not see an alternative to obeying the logic of the globalised market.

It’s the rules which are the issue – not those who win. Theera Disayarat/Shutterstock.com

The only way to change the game is to redesign its most basic rules. To attribute climate change to an abstract system called capitalism – but without challenging the idea of all-purpose money – is to deny our own agency. The “system” is perpetuated every time we buy our groceries, regardless of whether we are radical activists or climate change deniers. It is difficult to identify culprits if we are all players in the same game. In agreeing to the rules, we have limited our potential collective agency. We have become the tools and servants of our own creation – all-purpose money.

Despite good intentions, it is not clear what Thunberg, Extinction Rebellion and the rest of the climate movement are demanding should be done. Like most of us, they want to stop the emissions of greenhouse gases, but seem to believe that such an energy transition is compatible with money, globalised markets, and modern civilisation.

Is our goal to overthrow “the capitalist mode of production”? If so, how do we go about doing that? Should we blame the politicians for not confronting capitalism and the inertia of all-purpose money? Or – which should follow automatically – should we blame the voters? Should we blame ourselves for not electing politicians that are sincere enough to advocate reducing our mobility and levels of consumption?

Many believe that with the right technologies we would not have to reduce our mobility or energy consumption – and that the global economy could still grow. But to me, that is an illusion. It suggests that we have not yet grasped what “technology” is. Electric cars and many other “green” devices may seem reassuring but are often revealed to be insidious strategies for displacing work and environmental loads beyond our horizon – to unhealthy, low-wage labour in mines in Congo and Inner Mongolia. They look sustainable and fair to their affluent users but perpetuate a myopic worldview that goes back to the invention of the steam engine. I have called this delusion machine fetishism.

A globalised solar-powered future is wholly unrealistic
Not the guilt free option many assume them to be. Smile Fight/Shutterstock.com

Redesigning the global money game

So the first thing we should redesign are the economic ideas that brought fossil-fueled technology into existence and continue to perpetuate it. “Capitalism” ultimately refers to the artefact or idea of all-purpose money, which most of us take for granted as being something about which we do not have a choice. But we do, and this must be recognised.

Since the 19th century, all-purpose money has obscured the unequal resource flows of colonialism by making them seem reciprocal: money has served as a veil that mystifies exploitation by representing it as fair exchange. Economists today reproduce this 19th-century mystification, using a vocabulary that has proven useless in challenging global problems of justice and sustainability. The policies designed to protect the environment and promote global justice have not curbed the insidious logic of all-purpose money – which is to increase environmental degradation as well as economic inequalities.

In order to see that all-purpose money is indeed the fundamental problem, we need to see that there are alternative ways of designing money and markets. Like the rules in a board game, they are human constructions and can, in principle, be redesigned. In order to accomplish economic “degrowth” and curb the treadmill of capital accumulation, we must transform the systemic logic of money itself.

National authorities might establish a complementary currency, alongside regular money, that is distributed as a universal basic income but that can only be used to buy goods and services that are produced within a given radius from the point of purchase. This is not “local money” in the sense of LETS or the Bristol Pound – which in effect do nothing to impede the expansion of the global market – but a genuine spanner in the wheel of globalisation. With local money you can buy goods produced on the other side of the planet, as long as you buy it in a local store. What I am suggesting is special money that can only be used to buy goods produced locally.

A globalised solar-powered future is wholly unrealistic
Locally produced goods. Alison Hancock/Shutterstock.com

This would help decrease demand for global transports – a major source of greenhouse gas emissions – while increasing local diversity and resilience and encouraging community integration. It would no longer make low wages and lax environmental legislation competitive advantages in world trade, as is currently the case.

Immunising local communities and ecosystems from the logic of globalised capital flows may be the only feasible way of creating a truly “post-capitalist” society that respects planetary boundaries and does not generate deepening global injustices.

Re-localising the bulk of the economy in this way does not mean that communities won’t need electricity, for example, to run hospitals, computers and households. But it would dismantle most of the global, fossil-fuelled infrastructure for transporting people, groceries and other commodities around the planet.

This means decoupling human subsistence from fossil energy and re-embedding humans in their landscapes and communities. In completely changing market structures of demand, such a shift would not require anyone – corporations, politicians, or citizens – to choose between fossil and solar energy, as two comparable options with different profit margins.

To return to the example of Morocco, solar power will obviously have an important role to play in generating indispensable electricity, but to imagine that it will be able to provide anything near current levels of per capita energy use in the global North is wholly unrealistic. A transition to solar energy should not simply be about replacing fossil fuels, but about reorganising the global economy.

Solar power will no doubt be a vital component of humanity’s future, but not as long as we allow the logic of the world market to make it profitable to transport essential goods halfway around the world. The current blind faith in technology will not save us. For the planet to stand any chance, the global economy must be redesigned. The problem is more fundamental than capitalism or the emphasis on growth: it is money itself, and how money is related to technology.

Climate change and the other horrors of the Anthropocene don’t just tell us to stop using fossil fuels – they tell us that globalisation itself is unsustainable.


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Financial and Monetary Policies in Climate Change Mitigation

Financial and Monetary Policies in Climate Change Mitigation

The IMFBlog, a forum for the views of the International Monetary Fund staff and officials on pressing economic and policy issues produced this article dated September 4, 2019, that suggests that financial and monetary policies in climate change mitigation have a role to play in order to achieve COP21, 22, 23, 24 and eventually the 25th one to be held on December 2 through 13, 2019.

Financial and Monetary Policies in Climate Change Mitigation

A Role for Financial and Monetary Policies in Climate Change Mitigation

By William Oman

July 2019 was the hottest month ever recorded on earth, with countries across the world experiencing record-breaking temperatures. A prolonged drought is affecting millions of people in East Africa, and in August 2019 Greenland lost 12.5 billion tons of ice in one day.

photo: Rattankun Thongbun/Getty Images by iStock

A review of the literature by IMF staff aims to spur discussion of what policies to mitigate climate change could or should include. The review suggests that, while fiscal tools are first in line, they need to be complemented by financial policy tools such as financial regulation, financial governance, and policies to enhance financial infrastructure and markets, and by monetary policy.

Financial and monetary policy tools can complement fiscal policies and help with mitigation efforts.

The stakes are high. There is a broad scientific consensus that achieving sufficient mitigation requires an unprecedented transition to a low-carbon economy. Limiting global warming to well below 2 degrees Celsius requires reductions of 45 per cent in CO2 emissions by 2030, and reaching net zero by 2050. Despite the 2015 Paris Agreement, greenhouse gas emissions are high and rising, fossil fuels continue to dominate the global energy mix, and the price of carbon, remains defiantly low, reinforcing the need for complementary policies.

The case for policy action beyond carbon pricing

Our review of academic and policy studies suggests that, currently, there are insufficient incentives to encourage investment in green private productive capacity, infrastructure, and R&D. At the same time, investments continue to pour into carbon-intensive activities. These undesirable economic outcomes prevent the needed decarbonization of the global economy. Decarbonization requires a transformation in the underlying structure of financial assets—a transformation that, studies suggest, is hindered by several deficiencies in the way markets function.

First, financial risks may not reflect climate risks or the long-term benefits of mitigation, given many investors’ shorter-term perspectives. Moreover, financial risks are often assessed in ways that do not capture climate risks, which are complex, opaque, and have no historical precedents.

Second, there is a wide gap between the private profitability and the social value of low-carbon investments. High uncertainty around their ability to reduce emissions, as well as the future value of avoided emissions, makes low-carbon investments unattractive to investors, at least in the short run.

Third, corporate governance that favors short-term financial performance may amplify financial “short-termism,” while constraints in capital markets can lead to credit rationing for low-carbon projects.

The above review of previous literature suggests that because they directly influence the behavior of financial institutions and the financial system, financial and monetary policies can play a key role in addressing these issues.

Possible policy tools suggested by studies

The table below summarizes financial and monetary policy options for climate change mitigation, based on the above review of previous studies.

Policies that have been proposed in the literature can be divided into two categories: climate risk-focused and climate finance-promoting.

Climate risk-focused tools aim to correct the lack of accounting for climate risks for individual financial institutions and support mitigation by changing the demand for green and carbon-intensive investments, as well as their relative prices.

On the monetary policy side, examples include developing central banks’ own climate risk assessments, and ensuring that climate risks are appropriately reflected in central banks’ collateral frameworks and asset portfolios. On the financial policy side, tools include reserve, liquidity and capital requirements, loan-to-value ratios, caps on credit growth, climate-related stress tests, disclosure requirements and financial data dissemination to enhance climate risk assessments, corporate governance reforms, and better categorization of green assets by developing a standardized taxonomy.

Climate finance-promoting policies seek to account for externalities and co-benefits of mitigation at the level of society—that is, to account for how economic activity harms the environment but could instead, in addition to mitigating climate change, generate social value through, for example, reduced air pollution or more rapid technological progress. These policies could help shift relative prices and increase investments. However, the fact that they add new goals to existing policies makes them more controversial.

Monetary instruments to promote climate finance include better access to central bank funding schemes for banks that invest in low-carbon projects, central bank purchases of low-carbon bonds issued by development banks, credit allocation operations, and adapting monetary policy frameworks.

Financial policy instruments to actively promote climate finance revolve around “green supporting” and “brown penalizing” factors in banks’ capital requirements, and international requirements of a minimum amount of green assets on banks’ balance sheets.

A Role for Financial and Monetary Policies in Climate Change Mitigation

What’s the bottom line?

More work is needed. The literature remains limited on the desirable package of measures to address climate mitigation. Nonetheless, financial and monetary policy tools can complement fiscal policies and help with mitigation efforts. All hands are needed on deck, for, as Mark Carney of the Bank of England has warned, “the task is large, the window of opportunity is short, and the stakes are existential.”