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Climate Summit Leaders Set Out Largest Emissions Cut Since 2015

Source: CAIT, Climate Action Tracker, Marsh McLennan Advantage

Note: 34 parties including the U.S. were analyzed from the 40 World Leaders invited to the Leaders Summit on Climate. Leaders from the European Commission, European Council, Denmark, France, Germany, Italy, Poland, and Spain were aggregated into one party—the “European Union”—for analysis. Total emissions data from 2018 was used and includes Land use, land-use change, and forestry (LUCF) and all greenhouse gases (CH4, CO2, F-Gas, N2O, etc.). Other parties not listed make up 1.9% of global emissions including, Chile, Jamaica, Antigua and Barbuda, Norway, Israel, Kenya, Gabon, Vietnam, Bangladesh, Singapore, Bhutan, Marshall Islands. The horizontal length of each region in the chart represents the share of total emissions of participants.

The Climate Leaders Summit last week set out the single biggest reduction in the global emissions gap since Paris, shaving off around two gigatonnes of carbon dioxide equivalent from 2030 emissions. (See footnotes 3 and 4 below.) Nevertheless, the emissions gap remains enormous — with around 29 gigatonnes of carbon dioxide equivalent left to address before the world can be on a 1.5 degree-Celsius pathway.

The summit’s participants are responsible for 81% of global emissions, with the 10 largest emitters accounting for two-thirds of the global total. Their key objective was to announce revised 2030 emissions reduction targets ahead of COP26.

Of those attending, the U.S., Canada and Japan announced new 2030 targets. The U.S. pledged to reduce emissions by 50-52% below 2005 levels by 2030 and is responsible for almost 80% of the combined 2030 savings pledged at the summit.

1. Announced plans to strengthen NDC at Leaders Summit on Climate. 2. Strengthened or announced plans to strengthen NDC before the Summit. 3. For the calculation of US emission savings, we assumed for the baseline, the emissions reduction trend from 2025 to 2030 would have been a continuation of the 2005-2025 trend. 4. For countries which proposed a new emissions reduction target range, the midpoint was used.

 

Italy Elects First Far-Right Leader Since Mussolini

Source: Reuters

Italy elected its most right-wing government since World War II in Sunday’s election, according to the latest vote tallies. Giorgia Meloni’s Brothers of Italy party won the majority (26%) of the vote, setting Meloni on course to be the country’s first female prime minister

A right-wing coalition between the Brothers of Italy, Matteo Salvini’s far-right Northern League, and Silvio Berlusconi’s center-right Forza Italia won the majority of the seats in the Senate and the Chamber of Deputies, with around 44% of the vote. Italy’s center-left alliance received 26% of the vote, though the center and center-left parties individually won more votes than the right. In the previous 2018 election, the Brothers of Italy, a party with neofascist origins, won only 4% of the vote.

The 2022 election was triggered by a vote of no confidence in outgoing prime minister Mario Draghi, who resigned in July despite winning the confidence vote. Italy’s national unity government lasted 18 months before falling apart under the pressure of parliamentary infighting, debt, a cost of living crisis, and the Ukraine conflict.

Meloni has pledged her support for Ukraine and NATO. But the Northern League and Forza Italia’s reportedly close ties to Russia, and admiration for Russian President Vladmir Putin, have caused concern among Western allies about a right-wing shift in Europe.

Business Freedom Recovers in Europe

Globally, political rights and civil liberties have been on the decline for sixteen consecutive years. Business and democracy have a strong positive relationship, but they do not always go hand in hand. For example, in the past five years, India has become less politically free, but more friendly to businesses.

Europe has historically enjoyed a high rate of political and civil freedoms, as well as a high ease of doing business. This changed during the pandemic, where Europe’s scores fell substantially in business freedom. Governments across the continent imposed restrictions on business and economic activity to curb the health consequences of COVID-19. This had a huge impact on businesses, amounting to a loss of about 15% in industrial production a month after the implementation of containment measures.

Recovery seems to be back on track, according to data from latest edition of the Index of Economic Freedom, where we observe a strong bounce back in business freedom scores across Europe. This recovery, however, will be tested by the challenges stemming from the Ukraine crisis.

Global Standard of Living Drops for Second Year, UN Reports

Source: The Economist

The standard of living dropped for people around the world in 2021, wiping out any gains since 2016, the United Nations reports in its recent Human Development Index. The report comes just as world leaders met at the United Nations General Assembly to discuss the most pressing global issues. 

The U.N. reports that the pandemic, the Ukraine conflict and the effects of climate change are driving reversals in human development in more than 80% of the countries surveyed. This is the second year in a row that the global standard of living has dropped — the first time the index has dropped two years in a row since it started in 1990. 

The index measures factors like life expectancy, education and income. COVID-19 caused the biggest fall in life expectancy worldwide since World War II. The pandemic particularly accelerated the decline of countries in Latin America and the Caribbean. Living standards also dropped significantly in South Asia and fell even further in sub-Saharan Africa. The ongoing cost-of-living crisis spurred by inflation and Russia’s invasion of Ukraine means that conditions are unlikely to improve in the near future.

Coal Prices Soar As Winter Approaches

Source: Data: FactSet; Chart: Axios Visuals

Coal prices are skyrocketing around the world as countries brace themselves for winter amid an energy crisis. Demand for coal surged this year after Russia’s invasion of Ukraine and subsequent Western sanctions caused natural gas and oil shortages worldwide.

The competition has driven coal prices to record highs: Europe’s benchmark coal futures rose to $320 a ton, about 90% higher than last year. Asian benchmark Australian Newcastle coal hit a record $431 a ton, and U.S. coal prices rose to $193 a ton. That’s roughly three times higher than the benchmarks in the second quarter of 2021. The EU’s ban on Russian coal went into effect last month, increasing the region’s reliance on imports from Indonesia and Australia.

China and India are the world’s largest coal consumers, accounting for 70% of global coal demand. And China has increased its reliance on coal this year as drought has reduced its hydroelectric power production. But Europe is one of the main drivers behind the current push for coal. High demand for coal power is expected to continue throughout the year, despite nearly 200 countries pledging to reduce their coal consumption at the 2021 United Nations Climate Change Conference.

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