An astonishing 720 million people around the world face falling back into extreme poverty unless we tackle climate change immediately, warns a new report by the Overseas Development Institute (ODI).

The report was published as world leaders gathered this week at the United Nations General Assembly and agreed the Sustainable Development Goals (SDGs), among which is the eradication of extreme poverty by 2030.

This goal is achievable, according to the ODI, but not without a greenhouse gas (GHG) emissions peak in 2030, and a fall to near zero by 2100. “Climate change increases the probability that those who emerge from extreme poverty will be at risk of falling back into it,” it concludes.

Beyond 2030

Sustaining poverty reduction therefore relies on curbing climate change the report argues.“If the global community is serious about eradicating extreme poverty for good, it needs to think beyond 2030. Eradicating poverty by 2030 will be no great accomplishment if we are incapable of sustaining that achievement from 2030 onwards.”

It continues: “It is policy incoherent for big GHG emitting countries, especially industrialised ones, to support poverty eradication as a development priority, whether through domestic policy or international assistance, while failing to shift their own economy toward a zero net emissions pathway.”

As the report notes, progress on poverty eradication over the past two decades has reduced the percentage of people living on less than $1.25 a day in the developing world – defined as the extreme poor – from 43 percent in 1990 to about 17 percent as of 2011.

"In order to stop poverty, we must stop climate change." – Jay Winter Nightwolf, Echota Cherokee nation. #ActOnClimate

— Sierra Club (@sierraclub) September 24, 2015

Analysing data on the impact of climate change on food prices, the effects of childhood malnutrition and stunting, the productivity of primary sectors (such as agriculture or mining), and increased droughts, the ODI estimates that up to 720 million people are at risk of facing extreme poverty from 2030 to 2050 under a business-as-usual scenario. As the report starkly points out, this is roughly the same number of people that exited extreme poverty over the last two decades.

However, this number is likely to be much higher if the effects of sea-level rise, an increase in airborne diseases, and conflict – among other climate impacts – are factored into calculations.

Ecomodernist Manifesto

The ODI report comes at the same time as a group of individuals calling themselves the ‘Ecomodernists’ launched their manifesto in London yesterday – among those promoting it include self-styled ‘climate lukewarmist’ Matt Ridley, and former environment secretary and climate denier Owen Paterson.

As the manifesto explains, ecomodernism believes in human rights and freedoms – chief among these, the alleviation of global poverty.

However, in contrast to the ODI’s report, their manifesto goes on to argue that “climate change and other global ecological challenges are not the most important immediate concerns for the majority of the world’s people. Nor should they be.”

Instead, technology should be the main driver in helping developing countries to achieve modern living standards and end material poverty it says. This includes intensive agriculture, nuclear energy, reforestation and urbanisation. Furthermore it argues that renewable energy is inadequate for meeting global energy demands and that there need not be a limit to economic growth.

Economic Growth

But as the ODI argues: “While [economic] growth is unquestionably part of reaching zero extreme poverty, relying on high growth rates alone to achieve this goal would be unwise. First, recent high growth rates may not be sustained. Projecting them decades into the future paints an overly optimistic view of extreme poverty in 2030.

“In reality, economic growth has become increasingly less effective at reducing poverty because of the increasing inequality of that growth. Since 2005, inequalities have widened even further in developing countries, leading to lower rates of poverty reduction than would have been the case if inequality had remained constant.”

Achieving a zero-emissions future, with peak emissions within 15 years, requires all countries to “transform” their economies, the ODI explains. Deep domestic GHG cuts are part of developed countries’ obligation it says, with middle and low-income countries also ensuring their current investment choices reduce their forecast emissions.

“This presents a global challenge that some argue conflicts with the goal of eradicating extreme poverty,” ODI acknowledges, “However, early evidence suggests low-emission economic development, although radically different from historic experience, is consistent with the combination of moderate, sustained and pro-poor growth and reductions in inequality needed to eradicate poverty.”

Therefore addressing growth and inequality together is “far more likely to reduce poverty than a strategy reliant on attempts to maximise growth alone, based on unrealistic projections.”

Agriculture and Cities

Pointing out that industrialised agriculture is a significant contributor to GHG emissions, the ODI looks to the World Bank which argues that “improving the productivity, profitability and sustainability of smallholder farming is the main pathway out of poverty in using agriculture in development.”

Doing so presents a “major synergy”, says the ODI, for reducing poverty and emissions “where there is the institutional capacity and political will to limit the land-use conversion of forests and other natural stores of GHGs.”

And on urbanisation, the ODI agrees it can drive positive change but only if city planners and policymakers tackle poverty and climate change together rather than “entrench and perpetuate old problems for new people”.

“The impact of unchecked climate change creates an insurmountable challenge for the zero poverty target,” it argues, “but climate change mitigation need not.”

Photo: Asian Development Bank via Flickr

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Rich G20 nations are spending about $88 billion (USD) each year to find new coal, oil and gas reserves even though most reserves can never be developed if the world is to avoid catastrophic climate change, according to a new report.

Generous government subsidies are actually propping up fossil fuel exploration which would otherwise be deemed uneconomic, states the report, “The fossil fuel bail-out: G20 subsidies for oil, gas and coal exploration.”

Produced by the London-based Overseas Development Institute and the Washington-based Oil Change International the 73-page analysis also noted the costs of renewables is falling and the investment returns are better than fossil fuels.  

“Every U.S. dollar in renewable energy subsidies attracts $2.5 in investment, whilst a dollar in fossil fuels subsidies only draws $1.3 of investment,” said the report released Tuesday, just days ahead of the G20 leaders meeting in Brisbane, Australia.

The report also notes the G20 nations are creating a ‘triple-lose’ scenario by providing subsidies for fossil-fuel exploration.

“They are directing large volumes of finance into high-carbon assets that cannot be exploited without catastrophic climate effects,” the report said. “They are diverting investment from economic low-carbon alternatives such as solar, wind and hydro-power. And they are undermining the prospects for an ambitious climate deal in 2015.”

Noting that leaders of the G20 countries, which produce about 80 per cent of global carbon emissions, pledged in 2009 to phase out ‘inefficient’ fossil-fuel subsidies, the report says there is a large gap between G20 commitment and action.

So who is paying for this exploration?

According to the report $49 billion of these subsidies occurred through state-owned enterprises, $23 billion from national subsidies delivered through direct spending and tax breaks and $16 billion from public finance from banks and financial institutions.

During the same period, the report said, the top 20 private oil and gas companies, globally, invested just $37 billion in exploration – less than half of what is provided annually by G20 governments – suggesting their exploration activities are highly dependent on public finance.  

The report added global fossil fuel subsidies — of which exploration is just one portion — are estimated to be $775 billion a year. 

Key findings in the report show that the U.S. provided some $5.1 billion in national subsidies to fossil fuel exploration in 2013 – almost double the level in 2009.

Australia, meanwhile, is providing $3.5 billion for the development of offshore and inland fossil-fuel resources and Russia is provides $2.4 billion in national subsidies for fossil fuel exploration.

The report noted the Canadian government offers a wide array of national subsidies that total a minimum of $928 million annually to encourage fossil fuel exploration, including tax benefits for nearly all exploration activities.  

“Despite the widespread perception that renewables are costly, our research reveals that finding new fossil fuel reserves is costing nearly $88 billion in exploration subsidies across the G20,” the Overseas Development Institute’s Shelagh Whitley said. “Scrapping these subsidies would begin to create a level playing field between renewables and fossil fuel energy.”  

Oil Change International’s director Stephen Kretzmann said “five years ago, G20 governments pledged to both phase out fossil fuel subsidies and take action to limit climate change. Immediately ending exploration subsidies is the clearest next step on both fronts.”

The report recommended governments should price carbon to reflect the social, economic and environmental damage associated with climate change, and reduce emissions to levels compatible with the globally agreed 2oC target.

It also recommended that G20 nations should immediately phase out exploration subsidies as a first step towards a wider fossil-fuel subsidy phase out and reform.

In addition, it said governments should transfer subsidies from exploration and other fossil-fuel subsidies to support for the transition to low-carbon development and universal energy access.

On the same day the report was published, a number of high-profile economists said in a letter to a number of newspapers that governments should end fossil fuel subsidies and galvanize international action on climate change.

“Given that two-thirds of currently known reserves cannot be exploited if the world is to remain within the internationally agreed 2º Centigrade threshold, this is a bad investment for tax-payers and the planet,” said the economists. “Fossil fuel subsidies turn upside down the logic of effective action on climate.”  


Religious leaders in Australia, according to a story published Wednesday, said “world leaders must move towards a renewable energy future or there will be human suffering on an unthinkable scale.”  

Anglican Church Bishop Professor Stephen Pickard was quoted as saying there is overwhelming scientific evidence about the impact of unchecked climate change.

“To our very great shame, unthinking economic growth has become the great treasure,” Pickard said. “It has captured our hearts. It has captured our pockets. It has blinded us to the wellbeing of the planet.”

Under Prime Minister Tony Abbott, coal-rich Australia, described as “being the developed world’s worst polluter per head of population,” repealed the nation’s carbon tax earlier this year.

Image Credit: Stop sign in the oilsands region. Photo by Kris Krug.

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