Development Issues – Global Themes

My first blog post on Huffington Post, “Fintech for Good” – slightly edited version below…

Back in 2009, a global consortium of researchers published a report with a provocative title, “Half of the World is Unbanked”. Five years later, the numbers had already dropped by 20%. Yet close to 2 billion adults globally still do not have access to formal financial services. They remain financially disconnected, without opportunities to increase their incomes, unable to securely save for a rainy day or borrow to improve their lives.

Even basic financial products and services remain out of reach for these people. An illness, accident or a death in the family can spell disaster for their financial situation and cause powerful shocks to their daily lives. These hundreds of millions are effectively locked out of a world which you and I take for granted. It does not have to be so.

Continue reading FinTech for Good

“Global Greening versus Global Warming” – Excerpts

Excerpts from “Global Greening versus Global Warming” by Matt Ridley (emphasis added):

…I am increasingly disaffected from science as an institution.

The way it handles climate change is a big part of the reason.

After covering global warming debates as a journalist on and off for almost 30 years, with initial credulity, then growing skepticism, I have come to the conclusion that the risk of dangerous global warming, now and in the future, has been greatly exaggerated while the policies enacted to mitigate the risk have done more harm than good, both economically and environmentally, and will continue to do so.

…Why do I think the risk from global warming is being exaggerated? For four principal reasons.

1. All environmental predictions of doom always are;

2. the models have been consistently wrong for more than 30 years;

3. the best evidence indicates that climate sensitivity is relatively low;

4. the climate science establishment has a vested interest in alarm.

…I will come to those four points in a moment. But first I want to talk about global greening, the gradual, but large, increase in green vegetation on the planet.

…As Myneni’s co-author Zaichun Zhu, of Beijing University, puts it, it’s equivalent to adding a green continent twice the size of mainland USA.

Frankly, I think this is big news. A new continent’s worth of green vegetation in a single human generation.

…Now let me back to global warming.

…These days there is a legion of well paid climate spin doctors. Their job is to keep the debate binary: either you believe climate change is real and dangerous or you’re a denier who thinks it’s a hoax.

But there’s a third possibility they refuse to acknowledge: that it’s real but not dangerous. That’s what I mean by lukewarming, and I think it is by far the most likely prognosis.

I am not claiming that carbon dioxide is not a greenhouse gas; it is.

I am not saying that its concentration in the atmosphere is not increasing; it is.

I am not saying the main cause of that increase is not the burning of fossil fuels; it is.

I am not saying the climate does not change; it does.

I am not saying that the atmosphere is not warmer today than it was 50 or 100 years ago; it is.

And I am not saying that carbon dioxide emissions are not likely to have caused some (probably more than half) of the warming since 1950.

I agree with the consensus on all these points.

I am not in any sense a “denier”, that unpleasant, modern term of abuse for blasphemers against the climate dogma, though the Guardian and New Scientist never let the facts get in the way of their prejudices on such matters. I am a lukewarmer.

The track record on doom

I said that one reason to be skeptical about dangerous climate change is that environmental predictions of doom are always wrong.

Here’s a list of predictions made with much fanfare and extensive coverage in the media in the 1970s, when I was young and green, in both senses of the word:]

…So what is the problem? Well, the theory of dangerous climate change depends on a whole extra step in the argument, one that very few politicians and journalists seem even to know about – the supposed threefold amplification of carbon dioxide’s warming potential, principally by extra water vapour released into the atmosphere by a warming ocean, and accumulating at high altitudes.

…As the distinguished NASA climate scientist Roy Spencer has written,

“If you fund scientists to find evidence of something, they will be happy to find it for you. For over 20 years we have been funding them to find evidence of the human influence on climate. And they dutifully found it everywhere, hiding under every rock, glacier, ocean, and in every cloud, hurricane, tornado, raindrop, and snowflake. So, just tell scientists 20% of their funds will be targeted for studying natural sources of climate change. They will find those, too.”

Does it matter that our politicians panicked in the early 2000s? Surely better safe than sorry?

Here’s why it matters. Our current policy carries not just huge economic costs, which hit the poorest people hardest, but huge environmental costs too.

…

But there is a further reason why it matters. Real environmental problems are being neglected. The emphasis on climate change as the pre-eminent environmental threat means that we pay too little attention to the genuine environmental problems in the world.

We bang on about ocean acidification when it is overfishing and run-off that is most hurting coral reefs.

We misdiagnose climate change as the cause of floods when it is land drainage and urban development that is the cause.

We claim climate change as the cause of extinctions, when it is invasive species that disrupt and damage ecosystems and drive out rare species.

We say climate change is a threat to air quality, when it is climate policy that has hindered progress in improving air quality.

We talk about losing seabird colonies to warming seas and then build wind farms that slaughter the birds while turning a blind eye to overfishing.

Here’s why I really mind about the exaggeration: it has downgraded, displaced and discredited real environmentalism, of the kind I have devoted part of my life to working on.

….In Germany, a 20% increase in renewables between 1999 and 2014 has resulted in no change in emissions at all.

Continue reading “Global Greening versus Global Warming” – Excerpts

FinSum @ Tokyo, Sept ’16

Great to have been at FinSum in Tokyo last week…The energy and excitement was palpable! I participated in a panel that Sheel moderated + led a session on FinTech in Development…

Here are the slides and an artist’s visualization of my talk (it’s flattering!):

workshop-agenda-and-visualization

Will try and share notes soon…

Why the Minimum Wage may not be such a good idea after all…

Watch Milton Friedman explain why such a move might actually hurt the ones it intends to help…

and read why “Raising the Minimum Wage is Still a Bad Idea” and why good intentions end up as bad policy…

Cartoon by Henry Payne, courtesy ValuesandCapitalism.com

..and while on this, here is a thought-provoking, nuanced take on child labour..

India, China and G11

Excerpts from a recent article by Liam Halligan (Chief Economist at Prosperity Capital Management) in The Sunday Telegraph, “China, Brazil and India belong in the G8”

*** Excerpts Begin (emphasis mine) ***

It’s become fashionable to say the G8 is pointless. Last week’s summit of the “world’s advanced industrial democracies” was certainly an anti-climax.

After all the posturing, “working lunches” and “financial stability pacts”, the impotence of the leaders gathered on the Japanese island of Hokkaido was displayed for all to see.

Western shares kept tumbling. Crude hit another record high. As the smell of meltdown turned acrid last week, the markets seemed determined to stress the G8’s irrelevance.

…
Since the mid-1970s, the US, UK, Germany, Italy, Japan, France and Canada have held an annual summit. Russia has recently been added – grudgingly, because four G7 members depend on its oil and gas. Even with Russia, the G8 accounts for only 14 per cent of the world’s population, and less than 60 per cent of the global economy. And that share of worldwide output can only fall as the fast-growing emerging giants continue to outpace the West.

The likes of China, Brazil and India have churned out average annual growth of 5 to 10 per cent for many years now – an expansion rate that’s set to continue. In dollar terms, these countries are now the fourth, 10th and 12th largest economies on earth – and climbing fast.

… Continue reading India, China and G11

Of, India, China, Apples and Oranges

My friend Ashutosh Sheshabalaya recently wrote a piece in which he underlined the important differences between India and China when it comes to approaches towards global warming and sustainable development.

In the piece he pointed out the intellectual laziness (and the mistake) of lumping India & China together in any debate about global warming and who bears responsibility for what. It is a brilliant read and one I highly recommend.

Some excerpts: EYE ON THE TIGERS (by Ashutosh Sheshabalaya)

…

They are omnipresent, even if they lie shrouded backstage in discussions about climate change. At last count, there were almost two-and-a-half billion of them – Chinese and Indians.

Indeed, one of the most sterile facets of the global warming debate is to refer to China and India, rather than to Chinese and Indians. China and India may be among the world’s biggest CO2 emitters. But your everyday Wang or Rajiv hardly qualifies for such an honour.

The reasons are clear: out of the world’s 235-plus countries, China and India’s populations outnumber the bottom 220 put together. And their per-head/per-body contribution to global warming is vastly lower than that of the West.

In the typical Indian’s case – commercial energy use is, crucially, also far below the global average. In 2005, world electricity consumption was 2,400 kilowatt hours (kWh) per person. India’s was just 432 kWh, four times less than China’s 1,662 kWh. Oil use, too, exemplifies such trends.

An Indian’s consumption of crude, at 0.8 barrels per year, pales against the world’s 4.5 barrels, and is less than half China’s 1.8. There is little point throwing more dazzling, vulgar beams of light by juxtaposing such figures against the Western world, lit up end-to-end for the Christmas and New Year festivities.

Still, what is clear is that the difference between India and China is at least as significant as that between China and the world. And here is a suggestion to move the climate change debate beyond noisy palavers (a word originally referring to the patronising monologues of European colonial adventurers in Africa).

Firstly, differentiate between India and China. Both may be rising industrial powers, but China’s economic growth-at-any-cost is rather different from that of India, and this difference goes far beyond the numbers referred to above.
Although similarly determined to remove poverty, democratic India also boasts deeply ingrained soft systems which have begun priming its voters for the trade-offs between economic growth and their longer-term costs.

It was India – not China, or the West – which established the first Ministry for Renewable Energy. That was in the early 1990s. Since then, India’s Supreme Court – widely considered among the world’s most activist judiciaries – has set the country’s green agenda, from forcing metalworking and chemical plant closures to driving one of the world’s most ambitious environmental projects to date, namely the conversion of the New Delhi public transportation system to compressed natural gas. There are hundreds of other such examples.

The rest of the Indian system, too, has responded, at least as far as possible in what remains one of the world’s poorest countries. Rural India now hosts 30 million high-efficiency ‘smokeless’ stoves, with a conversion efficiency four times higher than their predecessors. Indian biomass gasifiers – a key renewable energy technology – are exported across the world, even to squeaky-clean Switzerland. More broadly, even modern, industrialising India has chipped in. The country’s energy intensity has fallen from 0.3 kgs of oil equivalent per dollar GDP in 1972 to 0.19 kgs in 2003 – equal to Germany.

Against this, the near-comprehensive lack of awareness about such efforts outside India remains striking. So too does the innate assumption that clean air and climate change are concerns of enlightened shock troops from the West battling recalcitrant polluters in ChIndia’s wastelands. On November 23, without a by-your-leave, the New York Times announced that the US was “the world’s third largest wind (producing) country, after Germany and Spain.”

It also cited the Chief Executive of the European Wind Energy Association about a ‘second wave’ of “new countries with significant wind capacity” – among them, “Britain, Canada, Italy, Japan and the Netherlands. “ No numbers anywhere, nor a single mention of India. As it happens, figures from the Global Wind Energy Council show India in fourth position, with 7,093 MW of installed windpower capacity in July 2007, three times that of Britain, Canada, Italy or Japan, and double that of China.

This is not to say that continuing industrialisation in India will not add to the world’s environmental woes. But pretending that India, and the 800 million Indians below the Davos line are doing nothing about it robs the debate of seriousness, and provides little incentive for meaningful cooperation with the West.

Read more from Tosh here:

Of Googlies*, Cricket, India and China

“The 3 Rounds of Globalization”

The Gospel according to Goldman Sachs

and finally, a related post: Globalizing Consumption, American Style…

Al Gore’s Inconvenient Un-Truth(s)

Some of you may have already picked this.

In an embarrassingly timed judgement (just a day before he won the Nobel Prize), Mr Justice Burton (UK) “identified nine significant errors” in Al Gore’s “An Inconvenient Truth” and reportedly said that “the “apocalyptic vision” presented in the film was politically partisan and not an impartial analysis of the science of climate change.”

The Judge ruled that the film can be shown in UK classrooms but only if teachers added a disclaimed saying the film’s facts are disputed.

The Times identified the “nine mistakes” as below:

The first mistake made by Mr Gore, said Mr Justice Burton in his written judgment, was in talking about the potential devastation wrought by a rise in sea levels caused by the melting of ice caps.

The claim that sea levels could rise by 20ft “in the near future” was dismissed as “distinctly alarmist”. Such a rise would take place “only after, and over, millennia”.

Mr Justice Burton added: “The ar-mageddon scenario he predicts, inso-far as it suggests that sea level rises of seven metres might occur in the immediate future, is not in line with the scientific consensus.”

A claim that atolls in the Pacific had already been evacuated was supported by “no evidence”, while to suggest that two graphs showing carbon dioxide levels and temperatures over the last 650,000 years were an “exact fit” overstated the case.

Mr Gore’s suggestion that the Gulf Stream, that warms up the Atlantic ocean, would shut down was contradicted by the International Panel on Climate Change’s assessment that it was “very unlikely” to happen.

The drying of Lake Chad, the loss of Mount Kilimanjaro’s snows and Hurricane Katrina were all blamed by Mr Gore on climate change but the judge said the scientific community had been unable to find evidence to prove there was a direct link.

The drying of Lake Chad, the judge said, was “far more likely to result from other factors, such as population increase and overgrazing, and regional climate variability”. The melting of snow on Mt Kilimanjaro was “mainly attributable to human-induced climate change”.

The judge also said there was no proof to support a claim that polar bears were drowning while searching for icy habitats melted by global warming. The only drowned polar bears the court was aware of were four that died following a storm.

Similarly, the judge took issue with the former Vice-President of the United States for attributing coral bleaching to climate change. Separating the direct impacts of climate change and other factors was difficult, the judgment concluded.

Related Post: Help, I’m feeling cold…

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What counts as innovation?

A few days ago I met Matthew Scott for lunch. Matthew told me the story of “Mighty Light“.

MightyLight aims to bring “light” (literally) into the lives of millions who live in remote parts of the world and don’t stand a chance to get grid connectivity. It aims to do so by a clever product that is solar-charged and uses energy efficient white LED for lighting.

It got me thinking on how innovation in distribution channels is probably as critical as innovative product design in the context of domestic consumers in emerging markets (and particularly so in the case of BOP consumers…)

Now, if you are a purist – this may not count as true innovation.

Distribution channels (or even innovation in distribution channels) is not something that you can patent…and yet there is no doubt that products like these are capable of transforming the lives of millions through clever combination of technology and distribution which hitherto was not possible.

In other words, they fit the criteria of high-impact and definition of a “breakthrough product” – and possibly innovation.

What do you think?

On a related note, I also spoke with Alok Singh, CEO of Novatium a few days ago – they too are doing something that is fairly unusual and exploting a business model around services that has not been tried in the PC industry before . Will it work? We dont know yet.

Is it an innovative approach? I certainly think it is.

Related Post: Has the $100 PC finally arrived?

Category: Development Issues

A few charts on global carbon emissions by region/country

Top 10 Solutions to Climate Change

FinTech for Good