Green Banking for Green Industry
Dhaka University, 09 04 2016
Hon’ble State Minister,
I am honoured to be given the opportunity to discuss with you this topic which was in fact one of the main issues addressed last year within the framework of the international negotiations on climate change.
Last year my country committed itself to bringing the world towards a global agreement on climate change. I would like first to come back of the targets of this conference because they are the reasons why we talk about green finance and renewable energies.
It was a tremendous challenge to address and I am proud that COP21 met the success we know, with an agreement approved by all the countries of the world.
Next 22nd of April at the United nations will be time to confirm this global commitment for our Governments and to sign this agreement, before ratifying it later.
It was a difficult challenge to bring the world to understand that human activity has a real impact on our environment. For many years, some scientists and leading people denied this fact.
It’s true that climate has always changed through the billions of years of our planet’s life: 4000 years ago, the Saudi Kingdom was all green. And now it is a desert.
This is not the point. The point is that human activity has accelerated the pace of the change. Now this fact is admitted by all of us. But it took time to recognize and to address this issue.
Climate change’s process is certainly complicated to understand.
What we can say is that human activities generate so-called “anthropogenic” greenhouse gases, distinct from the greenhouse gases naturally present in the atmosphere. Those greenhouse gas emissions alter the atmosphere’s composition, causing the increased greenhouse effect that is leading to global warming.
Under current global emissions trends, the rise in average global temperatures should come to between 3.7°C and 4.8°C by 2100. To limit atmospheric concentrations by 2100 and achieve the goal of keeping global warming below 2°C, global greenhouse gas emissions need to be reduced by 40-70% by 2050 compared to 2010 levels, and to drop to levels close to zero CO2 emissions by 2100.
Even if we don’t really understand this process, at least, what is easy to understand is that for decades and even centuries, human beings have been leaving behind them a very bad footprint on their environment.
So now the matter is: how to alleviate this footprint in order to live as part of our environment, rather than against our environment.
Our societies are consuming societies, money is the fuel used to feed our system and profit is the engine.
This is the reason why the only way to change this model is to shape a new model, in which our fuel would be less polluting, but in the same time preserving a realistic level of profit.
Because without profit we can’t invest in order to improve our world.
Last year, my country decided to host the Business and Climate Summit to work on this issue.
Responding to the UN Secretary General’s continued call for the private sector to take a more active role in the world decarbonisation process, global business leaders have gathered at this Summit in Paris in May 2015. This summit offered business leaders and policy-makers a unique opportunity to discuss how to scale-up low-carbon solutions, for a prosperous and safer future for all.
It was the fist time that we took the initiative to bring the issue of our global economic model in order to start thinking at a worldwide level about how to re-direct our finance towards funding in favour of environmental-friendly technologies.
Now the fact is that business is ready to play its role in meeting the climate challenge. There is a growing recognition within the business community that a low-carbon path is compatible with economic growth and human development. Committed companies of all sizes have worked for years to develop technological, organisational and financial solutions to reduce greenhouse gas emissions and adapt to changing climate conditions.
One of the conclusions of this summit was that consistent public policies are essential to implement these solutions at the scale and pace required to limit the world temperature increase to +2°C.
A strong cooperation between governments and businesses is key to create these new frameworks in which the economic actors can operate efficiently.
To summarize, at this summit everybody agreed that if we want to contain the foot print of our activities on the environment, we will all have to green our funding, we will all have to invest in research and development and we will all have to shape a low carbon economy.
In my understanding this must be our global goal, and it is also the topic of the day.
One of the main revolution of the human story was the invention of printing. But printing means something to print on, and this is paper. And paper means fibre, fibre means trees.
For a long time, we have considered that we had a right to alter our natural environment in order to develop our activity. Now we know that forests are vital for us, because forests absorb CO2, and this CO2 and other chemical particles, all named “green house gas emissions” come to have a tremendous impact on our atmosphere when it is not sufficiently absorbed by our environment.
As said before, because of our action, we have pushed our environment into a cycle which is highly difficult to reverse, except if we drastically change our system.
How to brake the pace of this cycle is a matter of life or death for our humanity.
This is why we can consider that the second revolution of our humanity is ICT, and in particular dematerialization.
Dematerialization means that we don’t need to use trees anymore. We don’t need to destroy our environment. We can even use our environment on a friendly way. This means renewable energy.
In my country, we have adopted the energy transition act last year. This act is bound to lay the basis for a new society.
This act sets ambitious goals and provide operational tools and simple, effective instruments to lower the energy bills of both France and its citizens while combatting climate disruption.
The targets are, by 2030, to reduce greenhouse gas emissions by 40% compared with 1990 levels; to reduce fossil fuel consumption by 30% by 2030 compared with 2012; to increase the share of renewable energies to 32% of final energy consumption and 40% of electricity production by 2030; to reduce final energy consumption by 50% by 2050, with an intermediate 2030 target of 20% compared with 2012.
At a very grass root level, people are encouraged to invest in renewable energies - for example solar panels for their houses, through the access given to funds free of interest, or through a contribution to the expenses by the state.
Banks are also encouraged to move green by giving the priority to dematerialization in their relations with their customers and by funding projects to develop renewable energies at all levels.
Our administration has completely changed: most of our administrations are now e-administrations.
There is a reason why this revolution, which is a computerization of our lives, has been made possible. This reason is the tremendous progress made in storage capacities of our computers.
We don’t need to have paper sheets: our documents can be dematerialized without losing their legal value.
Banks have a key role to play, as they are responsible for funding this global move.
Being a Green bank means being a bank conscious of the importance of consuming less and favouring less consumption.
Banks can decide their funding target. They can encourage environmental friendly choices, as I explained through the example of my country.
Here as you know, Bangladesh is the first country of the world in terms of domestic solar solutions. Public and private national funds, as well as donor funds are mobilized in order to build solar power plants.
This trend has to be maintained and supported because it is the only way to create a sustainable society, respectful to its environment.
For a country like Bangladesh which is a country in transition with a tremendous need for energy in order to accompany its development, that’s a big challenge, because it may seem to be easier to go to coal energy.
Bangladesh has a very good opportunity to seize, and this seminar is the evidence of the consciousness of this opportunity.
Bangladesh knows that it is not because it is a developing country that it can consider to be exempted of this obligation to take care to its environment.
In fact, in 2010, developed countries accounted for 18% of the global population, 54% of GDP and 36% of global greenhouse gas emissions. Today, their per capita greenhouse gas emissions is slightly less than three times those of developing countries. That gap was of four times in 2004.
These figures show that the effort to green our banks and our funding in favour of solar energy or any other renewable energy must be considered as a worldwide concern, whatever the level of development and Bangladesh was fully right to anticipate this issue.
To conclude I would like to underline the key role that Bangladesh could play within the framework of the international Solar Alliance launched by India and France last year at COP21, as Bangladesh has met a full success in development of domestic solar solutions.
I thank you for your attention./.