Henry Fernandez, the Chairman and CEO of MSCI, recently shared his observations on the importance of the Asia-Pacific (APAC) region in global economic growth and its critical role in achieving global net-zero carbon emissions.
Sharing his insights on the transition to green energy for the APAC region, Fernandez claims that “”the Asia-Pacific region can play a significant role in promoting net-zero emission solutions.”
Asia-Pacific’s Growing Significance
Fernandez emphasizes the increasing importance of the Asia-Pacific region in the global economy during his travels. As the CEO of the leading financial service company, MSCI, he notes that Asia Pacific countries are vying to become the focal points for climate and sustainable development within the region.
Fernandez also found a willingness among corporate and government leaders to discuss investment solutions related to climate change and expedite the decarbonization process. Notably, the region is witnessing the emergence of new products, companies, and platforms supporting the transition to net-zero. In fact, many countries have committed to achieving carbon neutrality by 2050 or 2060, including mainland China (by 2060), Japan (by 2050), and South Korea (by 2050).
Impact of Climate Change in Asia-Pacific
The Asia-Pacific (APAC) region has faced unprecedented heatwaves and extreme weather events. Fernandez underscores concerning figures, citing UN data that reveals residents in the region are six times more likely to encounter natural disasters compared to those outside the region. He points to the economic and fiscal ramifications of climate change, highlighting potential losses surpassing $1.2 trillion in Asia by 2050, primarily attributed to flood-related disasters.
Referring to McKinsey Global Institute’s high-emission scenario model, Fernandez delves into the potential global stock losses triggered by flood disasters, emphasizing that Asia would bear the brunt with a share exceeding 75%. The Swiss Re Institute projects a 2.6℃ temperature increase by 2050, foreseeing a substantial 20% decline in Asia’s economic output, notably with Southeast Asia facing a staggering 29% reduction, surpassing losses in any other region worldwide.
Financial Solutions and Investment Tools
Fernandez recognizes the role of financial instruments and investment tools in facilitating the transition to net-zero. MSCI’s research suggests that 15 APAC markets, including Australia, China, India, Japan, and South Korea, can systematically phase out coal-fired power plants by 2050, reducing coal-related emissions by 39% to 95%.
As Fernandez attends the 28th annual United Nations Climate Conference of the Parties (COP) in Dubai, he “looks forward to the conference bringing meaningful outcomes for countries and businesses in the Asia-Pacific region.” The COP conference, to Fernandez, serves as a crucial platform for global leaders, policymakers, and stakeholders to engage in meaningful discussions, negotiate agreements, and collectively address the pressing challenges posed by climate change.
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