EIB President Werner Hoyer’s keynote address to the Project Syndicate Forsaken Futures event on 14 September 2022.
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Ladies and Gentlemen,
We gather here today at a challenging time.
Russia holds the world hostage, using energy and food as weapons. Make no mistake: while Russian troops are fighting in Ukraine, Russia’s hostility is directed at the entire global community. With our reliance on fossil fuels, we have made ourselves vulnerable to the whims of autocrats. When relations between our open societies and these malign powers fall into crisis, energy costs explode. We saw it in 1973, in 1979, in 1990, and we see it today. Again.
At the same time, by burning these fossil fuels, we warm the planet, dangerously. We can already witness the dramatic consequences. Pakistan faces the worst floods in its history. Europe, China and the American West are emerging from severe, prolonged droughts. Droughts that causes crop failure and starvation. Like the violent conflicts with authoritarian states, climate change is causing human suffering and costing lives.
If our futures are not to be “forsaken”, we have to come to grips with reality. While we are too late to avoid all climate change, we must nonetheless stop it spiraling out of control, and we have to adapt to its unavoidable consequences. Simultaneously, we need to reduce our reliance on autocrats and dictators. Three actions are crucial at this point.
First, give investors, businesses and households the right incentives, and the right regulatory frameworks, to ensure they direct their funds towards low-carbon projects. Investment in energy efficiency, renewable energy and green innovation must be an absolute priority.
Second, we must put into focus the decarbonisation of more challenging, hard-to-abate sectors, such as heavy industry, shipping and aviation. These are responsible for almost a third of global emissions and do not yet have an economical, low-carbon alternative to fossil fuels.
Finally, we need to scale up adaptation finance and integrate adaptation considerations into all infrastructure projects globally. We must build railways, hospitals and other infrastructure in a way that can withstand more frequent and extreme weather events.
The European Investment Bank is doing its part, mobilising over $1 trillion in this decade towards a more sustainable economy and the transition to carbon neutrality. At the European Investment Bank, we have invested heavily in clean energy for many years, and we are supporting clean tech innovation. While some might be sceptical about a public institution’s support for innovation, the European Investment Bank financed offshore wind power twenty years ago, when commercial banks were unwilling to engage. Today, we do the same with floating offshore wind, battery storage, and green hydrogen.
We will commit even more resources in these areas, deploying the full power of our financial arsenal to back innovative projects that will help deal with the challenge ahead.
We will triple our global adaptation finance by 2025. Already today, we screen all the projects we finance for climate change risks and ensure they are adapted to future changes.
But public support, no matter how generous, won’t be enough to bankroll the transition to a net-zero and climate-resilient future. That’s why involving the private sector is crucial for making the transition a success.
Last, we must make sure that workers and societies prosper in the transition to a net-zero carbon economy. We must support the communities that are most vulnerable to the impact of climate change. Unless the transition is just and fair, we will fail – we will have no transition.
I am hopeful that Russia’s attack on Ukraine—with all the suffering it has caused, all the disruption it has triggered in energy, food and raw material prices—will be a breakthrough moment in the fight against climate change.
I wish you fruitful discussions at today’s event.
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