Lord Nicholas Stern, former adviser to the UK Government on climate change and ex-Chief Economist for the World Bank, recently visited Hong Kong between 27-28 October, fresh from a meeting in Beijing with leading mainland economists, where they discussed the implications of China’s growth and the increasing threat of climate change to the world’s population.

Lord Stern, now the IG Patel Professor at the London School of Economics, is also the special advisor to the Chairman of HSBC on climate change. He took time, while in Hong Kong, to brief leading businesses. GIFT’s Thomas Tang was on hand to facilitate the session, which was held at a dinner event on the 28th October at the HSBC Building in Central.

Lord Stern spoke of the imperative facing business to acknowledge the significant portent of climate change and global warming, and the urgency to take radical action now. A spend of one percent of global GDP now – even despite the economic crisis – would be money well-spent to avoid having to spend substantially much more later if action was delayed any further. The impacts of climate change would be dire and irreversible, as species would be wiped out and tracts of population would be redistributed worldwide as the lower lying areas became impacted by temperature changes and rising sea levels.

The fate of the world, according to Lord Stern, lay in the hands of two major economies: the USA and China. The USA must reduce its current footprint from 20 tonnes of carbon emissions per person to be more in line with the world average of 7-8 tonnes; thankfully climate change is on the presidential agenda of the next occupant of the White House. China meanwhile poses a more complicated challenge as the world’s fastest expanding economy attempts to balance growth with a sustainable carbon economy. However, the scope for innovation is high and there are plenty of opportunities for business in low carbon technologies, energy efficiency, renewable energy, carbon capture and forestation, if sought.

On the world economic crisis, Lord Stern talked of the need for liquidity in markets and echoed the need to cut interest rates, similar to other pundits. He did spell out though the necessity to invest in a low carbon future which, apart from giving a much needed fiscal boost to the ailing economy, would be timely and desirable for the environment. He further added that Hong Kong was well-positioned to take a lead in this.