Climate Change and the New Green Economy: The big questions for 2025
Live MintThe summer of 2024 was the hottest on record. More importantly, developing countries are tasked with growing without significantly adding to the global stock of GHG emissions, but the conditions to do so are not nearly supportive enough – the world’s poorest and most climate-vulnerable countries spent twice as much on repaying external debt than what they received as climate finance in 2022; several developing countries face far higher costs of capital, particularly for green technologies compared to their developed counterparts; unilateral trade measures such as the EU’s Carbon Border Adjustment Mechanism are likely to disproportionately hurt developing economies, hindering economic growth in key sectors and placing the onus of decarbonisation on the South. This is crucial both to meet domestic demand as well as participate in a global green economy, where countries like the US are looking to diversify their supply chains away from China. Raising the stakes Moreover, China’s record-breaking rise in the global green goods supply chain and its accelerating green transition have raised the economic and geopolitical stakes of building a green economy in other countries. Simultaneously, a seamless coordination with the rest of the developing world to push for transformation of multilateral spaces that are today hamstrung by the global imbalance of power, would serve it well carve out an equitable, green future for all.