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Climate change is "wreaking havoc" on supply chains
Climate change is disrupting industries around the world, and that has a major impact on global trade. On GZERO World with Ian Bremmer, WTO Director-General Ngozi Okonjo-Iweala lays out the case for diversifying and decentralizing production around the world to build resiliency and reduce risk in global supply chains.
“Climate change is wreaking havoc in so many places,” Okonjo-Iweala says, “If you concentrate your production in any one place, you risk really disrupting things.
The WTO Chief argues that by trading some of the “just-in-time” efficiency of global supply chains for resiliency, we can reduce the risk of climate disruption as well as the geopolitical risk of labor being contracted in a single country, like China.
“You see what is happening all over the world?" Okonjo-Iweala asks. "We do need to diversify if we want to build resilience.”
Watch the full interview: World trade at risk without globalization, warns WTO chief Ngozi Okonjo-Iweala
Catch GZERO World with Ian Bremmer every week at gzeromedia.com/gzeroworld or on US public television. Check local listings.
- Is the global food crisis here to stay? ›
- The geopolitics of the chips that make your tech work ›
- The Graphic Truth: The great supply chain squeeze ›
- Want to fix climate change? This is what it’ll take. ›
- What Africa has to say about climate change ›
- The Graphic Truth: Has climate change hurt or helped farmers? ›
- Ian Explains: Can we save the planet without hurting the economy? - GZERO Media ›
- "Climate is a problem, not the end of the world" - Danish author Bjorn Lomborg - GZERO Media ›
- Can the world run on green energy yet? Author Bjorn Lomborg argues that's very far off - GZERO Media ›
World trade at risk without globalization, warns WTO chief Ngozi Okonjo-Iweala
On GZERO World, Ian Bremmer sits down with WTO Director-General Ngozi Okonjo-Iweala to talk about world trade, the complicated business of moving goods and services across borders around the world.
Global trade hit a staggering $32 trillion in 2022 and the World Trade Organization oversees 98% of it. It’s an international institution that doesn’t normally make headlines, but has a massive role in almost every aspect of your daily life—from the food you eat, to the clothes you wear, to the cars you drive, to the phone you’re probably using to watch this video.
The WTO is the referee of global trade, a place for countries to negotiate agreements and resolve disputes. But it’s also received criticism for being too slow to adapt to the modern economy and for favoring wealthy nations over countries in the Global South.
Okonjo-Iweala has been pushing members to recommit to the principles of globalization and invest in developing economies.
“It's not right that 10 countries export 80% of the vaccines in the world,” Okonjo-Iweala says, “It's too concentrated.”
She argues that by decentralizing and diversifying global supply chains, we can make the global economy more resilient, reduce monopolies, and bring countries left on the margins of world trade into the mainstream.
Watch GZERO World with Ian Bremmer every week at gzeromedia.com/gzeroworld and on US public television. Check local listings.
- Episode 4: Broken (supply) chains ›
- US-China communications brighten over trade ›
- Climate change trade wars ›
- Hard Numbers: German far right comes up short, Ukraine dreams of drones, a space rock arrives on earth, world trade slows ›
- Women in power — the World Trade Organization's Ngozi Okonjo-Iweala ›
- What Africa has to say about climate change ›
- The Graphic Truth: Has climate change hurt or helped farmers? ›
- Crisis at the WTO: Fixing a broken dispute system - GZERO Media ›
Egypt wants COP27 to be all about implementation
Later this year, Egypt will be hosting the COP27 Climate Summit. What does the gathering hope to accomplish at such an uncertain time for climate action?
It's time to go from pledges and commitments to implementation, Egyptian Minister for International Cooperation Rania al-Mashat says during a Global Stage livestream conversation hosted by GZERO Media in partnership with Microsoft.
"We want it to be an implementation COP," she explains. "And for that to happen, there needs to be a way for all the private-sector commitments that were made in Glasgow to make their ways to countries. And the only way to do that is if more climate finance ... is presented to actually de-risk some of the private-sector investments."
Despite the ongoing conflict in Ukraine, Al-Mashat believes climate is still a common-denominator issue for the entire world. For instance, the war is having a huge impact on food security.
The key, she adds, is nevertheless to show the private sector that it's safe to invest in things in climate partnerships with the private sector that can be scaled up.
Watch more of this Global Stage event: Live from Washington, DC: Financing the Future
- Africa needs reachable climate goals, says DRC lawmaker Jeanine ... ›
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- Want to help poor countries now? Open your markets to their ... ›
- Time to call a COP: the COP26 climate summit - GZERO Media ›
- COP26 vibes so far: "What's it worth to save everything we have ... ›
- COP27 winners and losers - GZERO Media ›
- COP27: Not good enough ›
- The world "is more coupled than we think" - GZERO Media ›
2021: Groundhog Day in a G-Zero world
Did 2021 actually happen, or are we still stuck in 2020? So many things seem to have barely changed this year. After all, we’re entering yet another holiday season worried about a fresh wave of the pandemic, and uncertain about what comes next for our economies and our politics.
In a lot of ways, the past 365 days feel like a year of unfulfilled promise. Let’s have a look back at what did, and did not happen in 2021.
The year kicked off with US democracy in deep trouble: first the Capitol insurrection, and later Donald Trump's second impeachment over it. After Joe Biden was inaugurated as president, he told the world: America is back. (Spoiler: the world is still waiting.)
Global attention soon turned to the COVID vaccine rollout. It sputtered at first, but even when it got better it exposed deep divisions over things like health passes, vaccine mandates, and patent waivers. The vaccination gap between the rich world and everyone else was hard to ignore. Still, to have inoculated half the world’s population in under a year is no mean feat.
Middle East politics got hot again with a brief war between Israel and Hamas, Iran's presidential "election," and Bibi Netanyahu ousted as Israeli PM after 12 tumultuous years.
Then came a series of extreme weather events that focused everyone’s attention on climate change just months ahead of the COP26 climate summit. But first, the world watched in disbelief as the US chaotically withdrew from Afghanistan, and then the Taliban reclaimed power virtually overnight — right before the 20th anniversary of 9/11.
Like in 2020, global cooperation was hard to come by, as we saw a bit at UNGA but much more at COP26. The fact that even faced with such an existential problem, the world’s top polluters failed to agree on the same deadline for net zero emissions revealed again how fragmented global politics have become. Forget G20 or G7 — we live in a rudderless, G-Zero world.
In such crazy times, arguably the smoothest political transition came after the German election, with Angela Merkel handing over the reins after 16 years as chancellor — and Europe’s de-facto leader — to Olaf Scholz.
And now, as the end of the year approaches, we are about to mark the 30th anniversary of the Soviet Union’s collapse worrying about whether Vladimir Putin actually intends to invade Ukraine.
More broadly, there are three things that didn't really play out as many people expected they would at the start of the year.
First, US-China ties didn't get quite as bad as many feared. With Biden in the White House, the world’s two largest economies didn't exactly bury the hatchet. They remain at odds over trade, technology, Taiwan, the South China Sea, and Xinjiang. But they did find some common ground on climate — and domestic distractions for both countries helped quiet the rumblings of a new Cold War. (Not to mention a hot war, which as retired US Adm. James Stavridis told us, could start over Taiwan.)
The arrested development of deteriorating relations wasn't the product of anybody's grand design. Biden began his presidency with big foreign-policy ambitions, but he soon got bogged down at home by squabbling among Democrats over his domestic agenda, and later by Afghanistan. Xi Jinping, for his part, showed more interest in further consolidating his own power over tech giants, the Chinese economy, and the ruling Communist Party than in picking fights with Biden.
Whether the Cold Peace will hold in 2022 will likely depend on what happens inside each country, especially if they really start to recover from the pandemic.
Second, 2021 was the year of the vaccine, but the jabs on their own didn't end COVID. The good news is that vaccines were successful at bringing down deaths and severe illnesses. The bad news is that distribution was unequal, and hesitancy higher than expected in some places.
Where access to jabs was lacking, the delta variant brought a more deadly wave, like the one that ravaged India for weeks. (We spoke to Indian journalist Barkha Dutt the day after her own father had succumbed to the virus.) Now we are waiting to see how effective the current jabs are the face of omicron.
Finally, the post-pandemic recovery was not what we hoped for — mainly because we never made it to the “post-pandemic” at all. Even where economic growth rebounded to pre-pandemic levels, the lingering virus messed up supply chains (check out Ian Bremmer's explainer), drove up the prices of food, energy, and pretty much everything else.
US economist Larry Summers told us why he sounded the alarm bell on inflation earlier in the year. We also learned from LSE's Minouche Shafik about how women bore the brunt of the unequal pandemic recovery.
It’s been a disappointing year, but one way in which 2020 mirrors 2021 is that we end the year with fresh hope. Last year we looked forward to the arrival of the vaccine to change things. This year we look ahead to 2022 hoping that the current pandemic wave may be the last major one. Let’s see how our optimism fares this time around.
A person dressed as Uncle Sam attends an anti-mandatory coronavirus disease (COVID-19) vaccine protest held outside New York City Hall in Manhattan, New York City, U.S., August 9, 2021.
What We’ll Keep Watching in 2022: The authoritarian plague, climate vs energy crisis, US politics in Georgia
COVID & authoritarianism. Around the world, the pandemic has given national governments vastly greater mandates to manage how their societies and economies work. That has, among other things, created room for authoritarianism to grow and flourish. But there are different views on how that’s happened, and where. On the one hand, undemocratic or illiberal governments used pandemic restrictions to suppress anti-government protests or muzzle critics. Think of China using COVID restrictions to stop the burgeoning Hong Kong protests, or Russia doing the same to crack down on opposition rallies. Freedom House reported this year that the pandemic had contributed to democratic backsliding in 73 countries, the most since 2005. But there are also those who see authoritarian shadows in what democratic governments have done: imposing vaccine mandates, continued lockdowns, and school closures. In the US, a backlash against this has boosted Republicans ahead of next year’s midterms, while fresh lockdowns and mandates have also provoked fierce protests in Europe. There is also the thorny and unresolved question of how to police misinformation. Some Americans think social media platforms are erring on the side of too much content moderation as they struggle with the difficult problem of weeding out dangerous pandemic fake news. Overall, the question of what governments did during the pandemic, and whether it exceeded their mandates, will affect politics and geopolitics deep into 2022.
Going green without blackouts. This year at COP26, global leaders agreed to major climate pledges. As of now, some 90 percent of the global economy is committed to net-zero goals. That’s good news. But translating those promises into action is going to be a major political challenge in 2022. For one thing, new commitments to phase out fossil fuels are coming right as the world struggles with an energy crisis — shortages of natural gas and coal are driving up fuel and electricity prices around the globe. What's more, climate policies will figure in two major 2022 elections. One is in France, where it was barely two years ago that fuel taxes provoked the massive “yellow vest” protests which almost derailed Emmanuel Macron’s presidency. The other is the US midterms, where the climate aspects of Joe Biden’s Build Back Better plan will be a major point of disagreement between Republicans and Democrats.
Georgia 2022. As we move into an election year in the United States, we’ll be closely watching political dynamics in Georgia, a state that has emerged as a fascinating microcosm of several important trends in American politics. First, Georgia offered a vivid example of how the swing of suburban voters — in this case, in and around the state capital of Atlanta — tipped the 2020 presidential and congressional elections toward Democrats. Second, the January 2021 surprise elections of Jon Ossoff and Raphael Warnock to the US Senate gave the Democrats majority control of the upper house. Anything Democrats accomplish in Biden’s first two years as president is possible only because both Democrats won in Georgia. Third, Georgia is a central battlefield in fights over the counting of votes in 2020 and for voting rules for future elections. Fourth, Biden’s sagging approval ratings in Georgia underline the strong national momentum that Republicans now enjoy. And lastly, Donald Trump is actively backing Senate and gubernatorial candidates in Georgia who are challenging the state Republican establishment — and potentially dividing Republican voters. Republicans dominated Georgia’s politics for a quarter-century until Democrats broke through in 2020-21 by the slimmest of margins. No state will provide a better bellwether for US political trends in 2022.Episode 7: Why biodiversity loss matters to governments and investors
Listen: Are global leaders finally taking needed action on environmental issues? Coming out of the COP26 meeting in Glasgow, we've seen governments agree to a certain set of policies to fight climate change. But that isn't the only urgent environmental issue we face. The twin problem of climate change AND biodiversity loss are a serious threat to not just governments, but also investors.
The latest episode of Living Beyond Borders, a special podcast series from GZERO brought to you by Citi Private Bank, looks at how important biodiversity is to the global economy, and what leaders need to do to prevent further loss. Moderated by Caitlin Dean, Head of the Geostrategy Practice at Eurasia Group, this episode features Anita McBain, Managing Director at Citi Research, heading EMEA ESG Research; Harlin Singh, Global Head of Sustainable Investing at Citi Global Wealth; and Mikaela McQuade, Director of Energy, Climate and Resources at Eurasia Group.
Anita McBain
Managing Director at Citi Research, heading EMEA ESG Research
Harlin Singh
Global Head of Sustainable Investing at Citi Global Wealth
Mikaela McQuade
Director of Energy, Climate and Resources at Eurasia Group
Caitlin Dean
Practice Head, Geostrategy, Eurasia Group
U.S. President Joe Biden speaks virtually with Chinese leader Xi Jinping from the White House in Washington, U.S. November 15, 2021.
Joe Biden & Xi Jinping talked. US-China tensions remain.
Just hours ago, Joe Biden and Xi Jinping held their first bilateral videoconference together. The three-hour virtual meeting was, as expected, cordial despite sharply diverging views on many issues. (An effusive Biden even managed to elicit something between a Cheshire Cat grin and an outright smile from the famously stone-faced Xi.) Without much detail, both sides agreed to continue working together on climate following their COP26 joint pledge, and to return to normalcy on trade. On Taiwan — by far the prickliest of many prickly topics including Hong Kong and Xinjiang — Xi warned America to not "play with fire" while Biden responded that both countries are responsible for avoiding open conflict over the self-governing island. Nevertheless, the two leaders showed, at least in the brief part of the call that was open to the public, that they can deal with each other face to face in a respectful way, which puts at least some "guardrails" (the precise word Biden mentioned) on a bilateral relationship that is otherwise spiraling in slow motion toward confrontation.
COP26 climate deal: Reasons for hope
Ian Bremmer's Quick Take:
Hi, everybody. Ian Bremmer here. Just about to head to Singapore, but before I do, I thought I would give you guys a quick recap on the COP26 summit, couple weeks long in Glasgow.
And I understand that it's fashionable and important to talk about just how immediate and immense the climate crisis is, and that we didn't do enough, and we have more work in front of us, and all that is true, but actually I come away from the last two weeks fairly optimistic in the sense that the acceleration of effort that we're seeing from all corners, I mean there's even more from the central governments than you would've expected, and they were the underperformers, certainly more from the private sector, more from the banks, more from the corporates. And as a consequence, right now, I mean the big headline is that we are still on track for 2.4 degrees centigrade of warming if all of the countries make good on their existing pledges, which is itself unlikely. So we're not really on track for 2.4, it's higher. And that's double where we are right now, 1.2.
Having said that, there are a number of positive things that I think are also getting baked in, not just how much carbon is in the atmosphere. One is that they have decided, the participants of COP26, that they're going to come with new goals next year, as opposed to every five years, which had been the process. So as we're seeing more effort, as we're seeing more progress, we're also seeing stepped up urgency. And the very fact that you will now have a one-year, an annual summit that becomes an action-forcing event, even if it's marked by half measures, will end up getting you a lot more progress. I think that's significant and everyone agreed to that.
Secondly, the fact that fossil fuels were specifically called out in this agreement. And you'd think, well, that's crazy. Of course, we know that fossil fuels are one of the biggest contributors to carbon emissions, and so you need to get past fossil fuels if you're going to reduce climate change. But the fact is that governments, because all governments are able to veto the draft, have been unwilling to make that mention. We now actually see that this is a global draft that is really about making the transition away from fossil fuels, and everyone is on board with that now. A lot of countries are much more squirrely. A lot of countries will take a lot more time. Some because they're really committed in terms of the wealth that they make from the production of oil and gas; think about Saudi Arabia, think about Russia. Some because they're really poor and they desperately need to be able to continue to use relatively cheap energy to bring their people up to middle class, specifically India, but also Indonesia, to a degree China and others.
Having said all of that, I think it is pretty clear now that we are on track to have a majority of the world's energy consumption well before 2050 to be coming from renewable energy. And I include nuclear in that because it doesn't lead to carbon emissions, but in other words, post-fossil fuels, not gas, not oil, not coal. The International Energy Agency believes that that date is potentially 2035, which is wrong because it again requires that everyone actually adheres fully to stated goals. And this is a lot of countries that don't necessarily have a way to get from here to there legally enshrined, especially in the nearest-term. But the big story is acceleration of effort, and related to that, reduction of cost, improvement of technology; the fact that at scale, solar and wind, and particularly solar, are increasingly much cheaper than coal.
And so, once you have the financing that allows you to put new infrastructure in place, and again, it's using old infrastructure that is so much of the reason why there's going to be more of a lag around fossil fuels, you will see all countries, not just wealthy countries, moving much faster. So I mean, the four years of the fact that the United States and the Trump administration left Paris Climate Accord, renewable energies were still getting cheaper. They were still getting invested in inside the United States. State governments, mayors, city governments, lots of private sector actors, NGOs, they were all continuing to press and do more to respond to climate change, even as the federal government basically punted for four years.
The Biden administration is more disappointing than you would expect. John Kerry doing a really strong job and not alienating or antagonizing many people inside Biden administration, which frankly, a lot of people were surprised by, myself included. Nonetheless, I mean, you see that with the $1.2 trillion in infrastructure and what is likely coming down the pike in the coming weeks on social spending, a lot of the committed green transition spending is going to be taken out. So the Federal Government is doing less, but even so, you are getting significant effort from the United States, even in terms of moonshots. Part of this is there's so much money, interest rates are so low, investors are not happy with the idea of half a point, a point of returns every year. They're chasing returns and they're much more willing to invest in untested, but potentially moonshot technology.
So the fact that Peter Thiel, a company he's been involved in just raised $500 million for fusion energy technologies, I mean, could go absolutely nowhere, but it's by far the largest investment we've seen in that tech. Some of these things move, some of them are more incremental changes in improving things like battery technology and energy transmission, with greater efficiency and lower waste, the storage. All of these things very, very important to move the global economy away from fossil fuels.
Now, long-term, this is going to be very, very challenging for countries that are reliant on the production of fossil fuels. And in that regard, I think the UAE, which is looking to pump more now, but recognizing they need to diversify far more in the short- to medium-term, seems like a smarter strategy to me than the Saudis who I think believe that higher prices for longer are going to persist, and they will can continue to be the inexpensive producer of last resort. They will be, but I'm not sure that goes for as long as they are presently betting, just given how fast we're seeing government action is actually moving.
Now, of course, all of this is happening at a time where the planet is routinely breaking records and will continue to break records every year for extreme weather trends and for high levels of temperature. And of course, that means that larger parts of the world will be unlivable for longer periods of time. There will be more forced migrations. There will be more difficulty in providing agriculture for an additional billion people on the planet over the next 20, 25 years, most of whom will be in Sub-Saharan Africa, which is facing some of the greatest climate stresses. All of that is true. And particularly true is the sharp reduction in biodiversity that comes along with all of this that doesn't affect humans immediately and directly, but has all sorts of knock-on effects that we don't yet quite understand on the planet. And if you have a massive, great extinction, even if you don't know the science, you can generally suspect that there will be problems for the planet going forward, but this no longer feels like an existential threat to me.
In other words, I see out of COP26 that we have passed the tipping point of global seriousness on climate action. And so even if COP26 was not the point of no return; it was not, we either take seriously or we fail; it was not, we have to get to 1.5 degrees or its Armageddon; that was never true, but what I'm seeing is significant progress. I'm seeing a rationing up of the resources of the intense focus, maybe not of the coordination, but certainly of the urgency on a country-by-country, sector-by-sector, company-by-company basis.
And in that regard, we should come out of COP26 fully aware of just how much worse global climate will get over the next 25 years. By 2050, so much of the increase in climate change we're going to see is already baked in from carbon that we have already emitted. We are facing this cliff where 1.5 degrees is increasingly completely unreachable, and I'm not expecting that. But I am, nonetheless, more optimistic in human potential and capacity to address and respond to this challenge, the most existential, the most significant, the most all-encompassing challenge of our lifetimes that we've faced thus far on the basis of everything we've seen over the last two weeks.
So how's that to kick off your week? Maybe a little different than the headlines you're seeing other places, but I understand if it bleeds, it doesn't necessarily lead. But at least for me, I feel like it drives us a little less crazy that way. So, better to talk about what's actually going on.
Hope everyone is well. I'm on the way to Singapore and I'll see you all from there. Be good.