It could cost more than $130 billion a year to end deforestation by the end of this decade, a report by a group of financiers, energy industry executives and academics has found.
The Energy Transitions Commission, which counts senior BP and BlackRock employees among its members, said the analysis was an estimate of the funds needed “to overcome the economic incentive to cut down trees”.
The forecast is based on an analysis of the volume of grants or other forms of so-called concessional finance that would be needed to pay landowners not to engage in deforestation.
Financing forest preservation requires a different approach to investing in the decarbonisation of heavy industry or energy systems, said Adair Turner, the former City of London finance regulator who now leads the ETC.
Instead of the regular debt and equity financing that are used to electrify the power grid or develop new green steel plants, avoiding deforestation requires “a different category of financial flow”, namely “paying somebody not to do something” without expecting a direct rate of return, Mr Turner said.
The three most likely sources for these grant-based funds are governments that allocate money to protect forests, philanthropic support and carbon credits, he said.
For companies that have set science-based net-zero goals, buying carbon credits on the way to net zero can be an important method for supporting forest conservation, he said.
Without a "significant flow” of grant payments this decade, any reduction in deforestation would come "too late to make it possible to limit global warming to well below 2°C, let alone to 1.5°C", the ETC said.
Since 2018, 3.2 million hectares of primary forest have been lost each year from non-fire related causes, which is equal to a rate of 10 football pitches lost every minute, ETC said.
A separate academic paper published on Wednesday found that companies could have an effect on deforestation.
The researchers found 7,000 square kilometres of Amazon rainforest were spared between 2010 and 2018 thanks to commitments signed by companies under the G4 initiative, which was created following direct pressure from environmental non-profit group Greenpeace.
The area is equal to 15 per cent of the deforestation due to cattle farming that would have occurred during the period, models showed.
Cattle production is responsible for more than 70 per cent of Amazon deforestation, so if all companies signed and introduced zero-deforestation commitments, up to 24,000 square kilometres of rainforest would be conserved.
“Even reducing deforestation by 15 per cent is a huge amount,” said Rachael Garrett, a professor at the University of Cambridge Conservation Research Institute and senior author of the report.
“If enough countries join the UK and EU in purchasing only deforestation-free beef, it’s likely to have a positive impact on the planet by reducing deforestation.”
But deforestation commitments alone are not enough, the study found.
Less than 1 per cent of Brazilian cattle production is exported to the EU, the largest market where policies have been considered to date.
By contrast, 81 per cent of production between 2015 and 2017 was consumed domestically, where restrictions and public pressure have historically been lower.
Still, increasing involvement by Brazil's three leading supermarket chains — Carrefour, Walmart and GPA — put pressure on the local market, even during Jair Bolsonaro’s presidency, the academic study said.
For companies, there may be financial benefits to protecting forests and other natural ecosystems such as higher credit ratings, research from Bank of America analysts found.
Businesses with lower biodiversity risk scores are likely to be rated BBB+ or higher, while those that take measures to restore nature also may face lower financing costs, the bank’s ESG (environmental, social and governance) strategists led by Dimple Gosai wrote in a report published last week.
Biodiversity is a large driver of financial stability for companies, particularly in the energy, materials and commodity-orientated industries, they said.
Global assets in biodiversity-related investments may rise 20-fold to more than $400 billion by 2030, the strategists said.
Investors are already channelling money to things including alternative proteins and food waste-saving technology, and new projects such as land restoration and sustainable fisheries are attracting capital from impact investors, social enterprises and investments that blend public and private money, they said.
Putting an end to deforestation would represent a major step towards preserving nature and limiting the increase in global temperatures.
Deforestation, which involves clearing land for farms, ranches, timber and urban use, is responsible for about 15 per cent of the world’s carbon dioxide emissions, and the global economy will not reach net-zero carbon emissions without putting an end to the practice.
Still, finding sufficient funds will be difficult, the ETC said.
The commission said the $130 billion figure represents a sum of money, in the form of grant payments, that “could make an important contribution to avoiding deforestation”.
The cost of putting a “permanent stop” to all deforestation by 2030 could be as much as $900 billion a year.
In either case, the order of magnitude is so far in excess of current financing for forest protection, which ETC puts at about $3 billion a year.
Financial solutions to deforestation will be nothing more than a stopgap without changing the underlying forces that make deforestation economically viable, Mr Turner said.
Consumers need to take action by curtailing their demands for meat and palm oil, while governments should outlaw deforestation and enforce it, he said.
“Unless you find a way to switch off the fundamental demand drivers that are driving deforestation, paying people not to deforest is like pushing water uphill,” Mr Turner said.
Common OCD symptoms and how they manifest
Checking: the obsession or thoughts focus on some harm coming from things not being as they should, which usually centre around the theme of safety. For example, the obsession is “the building will burn down”, therefore the compulsion is checking that the oven is switched off.
Contamination: the obsession is focused on the presence of germs, dirt or harmful bacteria and how this will impact the person and/or their loved ones. For example, the obsession is “the floor is dirty; me and my family will get sick and die”, the compulsion is repetitive cleaning.
Orderliness: the obsession is a fear of sitting with uncomfortable feelings, or to prevent harm coming to oneself or others. Objectively there appears to be no logical link between the obsession and compulsion. For example,” I won’t feel right if the jars aren’t lined up” or “harm will come to my family if I don’t line up all the jars”, so the compulsion is therefore lining up the jars.
Intrusive thoughts: the intrusive thought is usually highly distressing and repetitive. Common examples may include thoughts of perpetrating violence towards others, harming others, or questions over one’s character or deeds, usually in conflict with the person’s true values. An example would be: “I think I might hurt my family”, which in turn leads to the compulsion of avoiding social gatherings.
Hoarding: the intrusive thought is the overvaluing of objects or possessions, while the compulsion is stashing or hoarding these items and refusing to let them go. For example, “this newspaper may come in useful one day”, therefore, the compulsion is hoarding newspapers instead of discarding them the next day.
Source: Dr Robert Chandler, clinical psychologist at Lighthouse Arabia
Tips to keep your car cool
- Place a sun reflector in your windshield when not driving
- Park in shaded or covered areas
- Add tint to windows
- Wrap your car to change the exterior colour
- Pick light interiors - choose colours such as beige and cream for seats and dashboard furniture
- Avoid leather interiors as these absorb more heat
The figures behind the event
1) More than 300 in-house cleaning crew
2) 165 staff assigned to sanitise public areas throughout the show
3) 1,000 social distancing stickers
4) 809 hand sanitiser dispensers placed throughout the venue
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
How has net migration to UK changed?
The figure was broadly flat immediately before the Covid-19 pandemic, standing at 216,000 in the year to June 2018 and 224,000 in the year to June 2019.
It then dropped to an estimated 111,000 in the year to June 2020 when restrictions introduced during the pandemic limited travel and movement.
The total rose to 254,000 in the year to June 2021, followed by steep jumps to 634,000 in the year to June 2022 and 906,000 in the year to June 2023.
The latest available figure of 728,000 for the 12 months to June 2024 suggests levels are starting to decrease.
The 15 players selected
Muzzamil Afridi, Rahman Gul, Rizwan Haider (Dezo Devils); Shahbaz Ahmed, Suneth Sampath (Glory Gladiators); Waqas Gohar, Jamshaid Butt, Shadab Ahamed (Ganga Fighters); Ali Abid, Ayaz Butt, Ghulam Farid, JD Mahesh Kumara (Hiranni Heros); Inam Faried, Mausif Khan, Ashok Kumar (Texas Titans
The Brutalist
Director: Brady Corbet
Stars: Adrien Brody, Felicity Jones, Guy Pearce, Joe Alwyn
Rating: 3.5/5
UAE currency: the story behind the money in your pockets
Defence review at a glance
• Increase defence spending to 2.5% of GDP by 2027 but given “turbulent times it may be necessary to go faster”
• Prioritise a shift towards working with AI and autonomous systems
• Invest in the resilience of military space systems.
• Number of active reserves should be increased by 20%
• More F-35 fighter jets required in the next decade
• New “hybrid Navy” with AUKUS submarines and autonomous vessels
Company profile
Name: Back to Games and Boardgame Space
Started: Back to Games (2015); Boardgame Space (Mark Azzam became co-founder in 2017)
Founder: Back to Games (Mr Azzam); Boardgame Space (Mr Azzam and Feras Al Bastaki)
Based: Dubai and Abu Dhabi
Industry: Back to Games (retail); Boardgame Space (wholesale and distribution)
Funding: Back to Games: self-funded by Mr Azzam with Dh1.3 million; Mr Azzam invested Dh250,000 in Boardgame Space
Growth: Back to Games: from 300 products in 2015 to 7,000 in 2019; Boardgame Space: from 34 games in 2017 to 3,500 in 2019
The Birkin bag is made by Hermès.
It is named after actress and singer Jane Birkin
Noone from Hermès will go on record to say how much a new Birkin costs, how long one would have to wait to get one, and how many bags are actually made each year.
What is graphene?
Graphene is extracted from graphite and is made up of pure carbon.
It is 200 times more resistant than steel and five times lighter than aluminum.
It conducts electricity better than any other material at room temperature.
It is thought that graphene could boost the useful life of batteries by 10 per cent.
Graphene can also detect cancer cells in the early stages of the disease.
The material was first discovered when Andre Geim and Konstantin Novoselov were 'playing' with graphite at the University of Manchester in 2004.
'Munich: The Edge of War'
Director: Christian Schwochow
Starring: George MacKay, Jannis Niewohner, Jeremy Irons
Rating: 3/5
MISSION: IMPOSSIBLE – FINAL RECKONING
Director: Christopher McQuarrie
Starring: Tom Cruise, Hayley Atwell, Simon Pegg
Rating: 4/5
Moral education needed in a 'rapidly changing world'
Moral education lessons for young people is needed in a rapidly changing world, the head of the programme said.
Alanood Al Kaabi, head of programmes at the Education Affairs Office of the Crown Price Court - Abu Dhabi, said: "The Crown Price Court is fully behind this initiative and have already seen the curriculum succeed in empowering young people and providing them with the necessary tools to succeed in building the future of the nation at all levels.
"Moral education touches on every aspect and subject that children engage in.
"It is not just limited to science or maths but it is involved in all subjects and it is helping children to adapt to integral moral practises.
"The moral education programme has been designed to develop children holistically in a world being rapidly transformed by technology and globalisation."
UAE currency: the story behind the money in your pockets
House-hunting
Top 10 locations for inquiries from US house hunters, according to Rightmove
- Edinburgh, Scotland
- Westminster, London
- Camden, London
- Glasgow, Scotland
- Islington, London
- Kensington and Chelsea, London
- Highlands, Scotland
- Argyll and Bute, Scotland
- Fife, Scotland
- Tower Hamlets, London
UAE gold medallists:
Omar Al Suweidi (46kg), Khaled Al Shehhi (50kg), Khalifa Humaid Al Kaabi (60kg), Omar Al Fadhli (62kg), Mohammed Ali Al Suweidi (66kg), Omar Ahmed Al Hosani (73), all in the U18’s, and Khalid Eskandar Al Blooshi (56kg) in the U21s.
Killing of Qassem Suleimani
Coming soon
Torno Subito by Massimo Bottura
When the W Dubai – The Palm hotel opens at the end of this year, one of the highlights will be Massimo Bottura’s new restaurant, Torno Subito, which promises “to take guests on a journey back to 1960s Italy”. It is the three Michelinstarred chef’s first venture in Dubai and should be every bit as ambitious as you would expect from the man whose restaurant in Italy, Osteria Francescana, was crowned number one in this year’s list of the World’s 50 Best Restaurants.
Akira Back Dubai
Another exciting opening at the W Dubai – The Palm hotel is South Korean chef Akira Back’s new restaurant, which will continue to showcase some of the finest Asian food in the world. Back, whose Seoul restaurant, Dosa, won a Michelin star last year, describes his menu as, “an innovative Japanese cuisine prepared with a Korean accent”.
Dinner by Heston Blumenthal
The highly experimental chef, whose dishes are as much about spectacle as taste, opens his first restaurant in Dubai next year. Housed at The Royal Atlantis Resort & Residences, Dinner by Heston Blumenthal will feature contemporary twists on recipes that date back to the 1300s, including goats’ milk cheesecake. Always remember with a Blumenthal dish: nothing is quite as it seems.
