Geneva: Switzerland needs investments of some 387 billion francs ($422 billion) to become climate neutral by 2050, an amount equivalent to about 2 per cent of the economy’s annual output, according to a report.
The study, by the Swiss Bankers Association and Boston Consulting Group, said 91 per cent of the funding can come from bank loans and the capital market, with the government needing to supply much of the remainder, chiefly to pay for public services like transport.
“If Switzerland is to achieve its net zero target by 2050, the Swiss economy must adopt more sustainable practices,” it said. “The Swiss financial center can make an important contribution toward this transition.”
The world’s top climate scientists have warned that the planet will warm by 1.5 degrees Celsius in the next two decades without drastic moves to eliminate greenhouse gas pollution. That will require significant financial investment, with the International Energy Agency estimating that hitting net-zero targets requires spending of $5 trillion a year in energy systems by the end of the decade.
The SBA report said motor vehicle transport and buildings needed the lion’s share of the investment. The total bill implies a need for 13 billion francs a year in funding. To make that happen, it urged Swiss officials to abolish disincentives, such as regulatory or tax hurdles. They could even come up with “green” incentives.
“This will allow measures to be implemented to reduce the greenhouse gas emissions of Switzerland’s ten highest-emitting business sectors,” they said.