5 climate and trade stories you need to know before COP27

Fri 21 Oct 2022
Posted by: Phillip Adnett

COP27 Egypt November 2023 - Preview of UN Climate Change Meeting

The 2022 version of the United Nations Climate Change Conference (COP27) is due to begin on 6 November in Sharm El Sheikh, Egypt.

Finishing on 18 November, this is the latest meeting of the world’s leadership to address the fight against climate change.

Ahead of COP27, the IOE&IT Daily Update turns its attention to the world of environment and trade, bringing you five climate stories you need to know.

1. A subdued affair?

COP27 comes at a time of turmoil on the international stage. S&P Global notes that the lead up to this year’s conference had “been notably subdued” compared with last year’s meetings in Glasgow.

In spite of this, a number of key issues are expected to be discussed.

Nick Savvides, news editor at The Loadstar, said he expected the conference to focus on phasing out harmful gas fuels and changes to tax rules to encourage sustainability.

African countries are reportedly determined to show more leadership on climate change, as the continent remains vulnerable to climate change

However, a report by environmental non-profit the World Resources Institute found that the latest set of’ pledges from countries are "woefully inadequate" to avert a significant rise in global temperatures.

2. World Bank reform

Several of the world’s major economies are pushing for environmental reforms at one of the most important financial institutions, the World Bank. Politico reports that Germany, the US, Australia and several other countries are involved in the move.

According to a statement, German development minister Svenja Schulze – who is also a governor of the bank – said that its current model “is mainly based on demand from borrowing countries” and “is no longer appropriate in this time of global crises.”

The proposals could include incentivising climate change action via better borrowing terms and using the bank’s financial clout to de-risk clean energy investments in developing nations, according to the FT.

COP26 president Alok Sharma separately called for a wider shake-up of the financial system to better fight climate change.

“We have to incentivise every aspect of the international system to recognise the systemic risk of climate change, and to make managing it effectively its central task,” said the former Conservative business secretary.

The calls come as research, reported in Reuters, from the European Network on Debt and Development found that developing island states, who are more exposed to both climate change and critical debt, spent at least 18 times more on servicing their debts than what they had received in climate finance.

3. Green shipping

The International Maritime Organization (IMO) has a target to reduce greenhouse gas emissions in shipping by 50% from 2008 levels by the year 2050.

Late on Wednesday (19 October), the European Parliament voted through a 2% mandate for green shipping fuels by 2030, according to the Loadstar.

However, at the Maritime Cyprus conference, a specialist shipping event, a number of marine engineers expressed doubts over whether shipping could change, according to shipping website TradeWinds.

“The gap between ratified goals and where we are going is immense. It’s the emperor’s new clothes. Everybody knows it’s not going to be reached, but everyone’s afraid to say it,” said Henning Brauer, a director at German shipping company GEFO.

Others, including Norwegian government advisor Sveinung Oftedal, said that the “tipping point” for decarbonisation had already been reached.

Transport secretary Anne-Marie Trevelyan and chair of Maritime UK Sarah Kenny have jointly called for the UK’s shipping industry “to seize the opportunities” offered by a “green maritime revolution”, in an article written in City AM.

4. Jet Zero

As the IMO reached an agreement, so too has the International Civil Aviation Organization (ICAO).

Members of the UN’s aviation agency reached an agreement to reduce the sector’s emissions by 2050, according to environmental website Edie.

Environmental groups have criticised the non-binding nature of the resolution and several members, including Russia and China, have questioned the feasibility of the strategy, according to the Guardian.

“Countries have achieved some tremendous and very important diplomatic progress at this event, and on topics of crucial importance to the future sustainability of our planet and the air transport system which serves and connects its populations,” said ICAO secretary general Juan Carlos Salazar.

5. Government drops challenge to net zero ruling

Business secretary Jacob Rees-Mogg quietly confirmed that the government will not be challenging a court decision which found their net zero strategy unlawful. The government initially stated it intended to appeal.

According to The Times, the government will need to draw up a new plan before March 2023.

The English High Court had previously ruled against the strategy after a challenge from public interest groups including the Good Law Project and Friends of the Earth.

Justice Holgate found that the business department had breached the Climate Change Act 2008 by formulating the plan without considering all the relevant information and not including enough information for proper public scrutiny.