BAKU, Azerbaijan, November 18. To reduce risks associated with the transition to net-zero emissions, action is needed in four key areas, said Guangzhe Chen, Vice President for Infrastructure at the World Bank (WB) during a panel discussion on "Accelerating global industrial and energy decarbonization – a growth/economic modernization agenda," Trend reports.
Chen emphasized that the World Bank recognizes the challenges that emerging markets and developing economies face in reaching net-zero emissions by 2050.
"The World Bank (WB) estimates that transitioning complex industries in emerging markets and developing economies to zero emissions by 2050 will require overcoming numerous challenges. A key obstacle is reducing the risks associated with such investments, which are often viewed as high risk. To address this, the WB has identified four critical strategies. The first is the establishment of effective carbon pricing. The third focuses on fostering innovation and advancing technology,” he said.
He highlighted that carbon pricing is a powerful tool for reducing emissions, as it addresses the cost disparity between green technologies and fossil fuels.
"However, its implementation faces challenges, particularly the impact on export-oriented industries. The European Union has proposed a carbon border mechanism to prevent carbon leakage. Government support is crucial in bridging the price gap. While developed countries are implementing large-scale programs, developing countries are receiving support through international initiatives such as carbon investment funds and green procurement. For example, Brazil will include green procurement in its new industrial policy," he added.
Chen also stressed the importance of innovation, stating that nearly half of the emissions reductions required by 2050 will depend on non-commercial technologies.
"Programs like the World Bank's ESMAP [Energy Sector Management Assistance Program] attract substantial investments, supporting the deployment of innovative solutions, such as those implemented at factories in Türkiye and Ghana. International cooperation plays a crucial role as well—global initiatives like the ‘Google Maps for Decarbonization’ platform connect developing countries with partners for technical assistance and financing of low-carbon technologies.
These efforts are key to building a sustainable, globally competitive industrial sector," he noted.
To note, the 29th session of the Conference of the Parties to the UN Framework Convention on Climate Change (COP29), which will run until November 22, opened at the Baku Olympic Stadium on November 11. It is the largest event organized by Azerbaijan to date, and the first time in the region that it is being held in Azerbaijan.
Within COP29, the highest level event - the summit of world leaders on climate action – was held on November 12–13.
The main expectation from COP29 is to agree on a fair and ambitious New Collective Quantitative Goal (NCQG) on climate finance. The COP29 chairmanship has launched 14 initiatives that include linkages between climate action and the Sustainable Development Goals, including green energy corridors, green energy storage, harmony for climate resilience, clean hydrogen, methane reduction in organic waste, action on green digital technologies, and other topics.
In addition to being a top priority that creates the conditions for action, creating climate finance will also help fulfill the 1.5°C pledge by bringing everyone together.
The UN Framework Convention on Climate Change is an agreement signed at the Rio Earth Summit in June 1992 to prevent dangerous human interference in the climate system. The acronym COP (Conference of Parties) stands for “Conference of Parties” and is the highest legislative body overseeing the implementation of the Framework Convention on Climate Change.
A total of 198 countries are parties to the Convention. Unless otherwise decided by the parties, COP is held annually. The first COP event was held in March 1995 in Berlin, and its secretariat is located in Bonn.
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