ESG and Of Interest News
The Economic Costs of Temperature Uncertainty
January 24, 2025--Summary
Beyond its environmental damage, climate change is predicted to produce significant economic costs. Combining novel high-frequency geospatial temperature data from satellites with measures of economic activity for the universe of US listed firms, this article examines a potentially important channel through which global warming can lead to economic costs: temperature uncertainty.
The results show that temperature uncertainty-by increasing power outages, reducing labor productivity, and increasing the degree of exposure of firms to environmental and non-political risks, as well as economic uncertainty at the firm-level-persistently reduce firms' investment and sales. This effect varies across firms, with those characterized by tighter financial constraints being disproportionally more affected.
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Source: imf.org
Uranium: Canada aims to become World's Biggest Uranium Producer as demand soars!
January 8, 2025--Canada is racing to become the world's biggest uranium producer as prices for the radioactive metal surge in response to soaring demand for emissions-free nuclear power and geopolitical tensions threaten supplies.
Cameco, the country's largest producer, said that production of uranium would jump by almost a third in 2024 to 37mn pounds at its two mines in the heartland of the country's uranium industry in northern Saskatchewan.
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Source: Metals and Miners
The Global Cooperation Barometer 2025-Second Edition
January 7, 2025--Global cooperation is at a crossroads. While overall collaboration has flatlined, driven by heightened geopolitical tensions and instability, positive momentum in areas of climate and nature, innovation and technology, and health and wellness offer hope.
The Global Cooperation Barometer 2025 offers a comprehensive assessment of global collaboration broadly and across five pillars: trade and capital, innovation and technology, climate and natural capital, health and wellness, and peace and security.
By analysing 41 indicators, the report identifies areas of progress and stagnation, highlighting the complexities of cooperation in a world marked by economic uncertainty, geopolitical divides and rapid technological advancements.
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Source: WEF (World Economic Forum)
New database on critical minerals trade launched to support clean energy transition
December 18, 2024-The Asian Development Bank (ADB) and the WTO Secretariat have jointly launched a database on trade in critical minerals to enhance transparency regarding these minerals and to support the clean energy transition. The database provides information on trade flows, allows visualizations of trade networks and specialization patterns and compiles data on tariffs and other trade policies for 250 critical minerals and related products across value chains.
The Trade in Critical Minerals (TiCM) database, unveiled by the ADB and the WTO Secretariat on 20 November at the Trade and Investment House at the COP29 climate change conference in Baku, provides in one place up-to-date critical minerals trade data, related policies, and visualisations of trade patterns based on publicly available sources.
Bilateral trade and tariff data are at the HS sub‑heading level and are sourced from WTO Analytical Databases. Trade policies are sourced from the WTO Trade Monitoring Database and the ePing trade measures platform, with links to HS codes. Data can be visualised as bar charts, tree maps, and network graphs, providing insights into the main trading partners, product specialization, and trade networks.
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Source: World Trade Organization (WTO)
The World's Oldest Bond Just Celebrated Its 400th Birthday And Still Pays an 13.64 Euro Annual Yield
December 16, 2024--On December 10,1624, a Dutch water authority issued a bond to fund repairs for a critical dike breach. Four centuries later,that bond is still alive,making it the oldest bond in the world. This perpetual bond, issued by Hoogheemraadschap Lekdijk Bovendams, continues to pay interest, reminding us of the enduring power of financial innovation.
The 400th-anniversary celebration saw representatives of the bond's current owner, the New York Stock Exchange (NYSE), receive an interest payment of €299.42 in Utrecht, Netherlands. Despite the modest annual yield of €13.64, the bond is a testament to the Dutch mastery of financial systems, which played a pivotal role in shaping modern markets.
The Origins of the World's Oldest Bond
In 1624, the Netherlands faced a devastating dike breach along the River Lek, threatening Amsterdam and surrounding areas. To fund the necessary repairs, Hoogheemraadschap Lekdijk Bovendams issued more than 50 perpetual bonds, raising 23, 000 Carolus guilders.
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Source: thecapitalist.com
Merchandise trade continues to expand in third quarter of 2024
December 13, 2024-World merchandise trade volume rose 1.1% quarter-on-quarter and 3.3% year-on-year, on a seasonally adjusted basis, in the third quarter of 2024, marking the fourth consecutive quarter of moderate trade expansion.
By comparison, merchandise trade in current US dollar terms was up 4.3% year-on-year in Q3. This represents a significant improvement from the 1.8% increase seen in Q2 and the 1.4% contraction observed in Q1.
For the year through September, trade volume was up 2.4% compared to the same period in 2023, slightly less than the WTO's most recent forecast of 2.7% for 2024issued on 10 October.
Meanwhile, the value of merchandise trade was up 1.6% over 2023. Slower trade growth in value terms than in volume terms implies a small (less than 1%) decline in prices of traded goods during this period.
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Source: World Trade Organization (WTO)
State Of Compute: The New Power Paradox
December 1, 2024--News broke November 28 that the U.S. government is considering additional curbs on the sale of semiconductor equipment and AI memory chips to China, escalating tensions between the two superpowers. It is a sign of the times. Governments have begun to view AI compute infrastructures, including advanced AI chips, as a geostrategic resource.
With good reason: in a recent podcast OpenAI CEO Sam Altman called compute "the currency of the future" and says he believes "it'll be maybe the most precious commodity in the world."
Countries that can "manufacture intelligence" at scale will be at the forefront of harnessing the benefits of finding solutions to key challenges, from green transition to digital biology, says a recently released report by the Tony Blair Institute For Global Change (TBI). It argues that compute is not just a source of scientific and economic progress, but the new benchmark of global power economically and geopolitically.
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Source: theinnovator.news
New report showcases opportunities to unlock trade in renewable electricity
November 15, 2024--A new report published today (15 November) by the World Meteorological Organization and the World Trade Organization points to the role that trade can play to help supply meet demand for electricity from renewable sources.
Launched at the 29th UN Climate Change Conference (COP29) in Baku, this first joint WMO-WTO report underscores how interconnection projects can tap into supplies of hydro-, solar-and wind-generated energy from regions with comparative advantage in renewable electricity generation and help to bring down the cost of the transition to low-carbon energy.
The publication, "Supporting the Renewable Electricity Transition through Trade: Unlocking Re-Globalization Opportunities via Interconnection," notes that cross-border electricity trade is well below its potential for providing the renewable energy needed to help countries meet Paris Agreement climate targets. Less than 3% of electricity generated worldwide is traded across borders, with a relatively low value of some US$ 132 billion in 2023 according to UN Comtrade statistics. There is tremendous scope for growth as cross-border renewable electricity trade can reduce the overall cost of the net zero energy transition, the report states.
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Source: World Trade Organization (WTO)
Progress in national climate policy efforts remains insufficient to achieve 2030 targets
November 7, 2024--The global economy is facing mounting challenges amidst the largest energy market shock since the 1970s and the cost-of-living crisis for many households from rising inflation pressures.
According to the 4th edition of the Climate Action Monitor, Nationally Determined Contributions (NDCs) currently commit to a collective reduction in greenhouse gas emissions of only 14% by 2030, compared to 2022 levels, in countries covered by IPAC which produce over 80% of global GHG emissions. This is well short of the estimated 43% global emission reduction needed to limit global warming to 1.5°°. Paris Agreement goal according to the Intergovernmental Panel on Climate Change (IPCC).
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Source: OECD.org
IMF Working Paper-Following the Money: Who is Keeping Coal Alive?
November 1, 2024--Summary
The 2023 United Nations Climate Change Conference reinforced already existing pressure to transition away from fossil fuels, in particular for the most polluting source, coal. We use a comprehensive dataset on bank loans for coal projects to shed light on which type of banks continue to finance coal and how coal phase-out commitments affect coal financing.
We find that coal financing is becoming increasingly concentrated, partly in banks with a very high coal exposure. We also find that many coal loans have maturities much shorter than the remaining lifetime of coal assets, thus exposing equity holders of coal assets to the risk of a more difficult loan rollover. An econometric analysis shows that countries with a strong commitment to coal phase-out, fixed in national law for example, receive less coal financing. Using an instrumental variable, we identify this effect as causal.
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Source: imf.org
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