The US is galloping ahead of the UK in renewables. Nicholas Hartnett, owner of Pure Power Solar, holds a panel as his company installs a solar array on the roof of a US home. AP
The US is galloping ahead of the UK in renewables. Nicholas Hartnett, owner of Pure Power Solar, holds a panel as his company installs a solar array on the roof of a US home. AP
The US is galloping ahead of the UK in renewables. Nicholas Hartnett, owner of Pure Power Solar, holds a panel as his company installs a solar array on the roof of a US home. AP
The US is galloping ahead of the UK in renewables. Nicholas Hartnett, owner of Pure Power Solar, holds a panel as his company installs a solar array on the roof of a US home. AP

How UK signals to business set up a self-defeating carbon fight


Chris Blackhurst
  • English
  • Arabic

There was no doubting the signal from Rishi Sunak on how the UK economy would decarbonise at the recent Cop28 summit in Dubai.

It was one of the key topics of conversation among the delegates that first week: how the UK Prime Minister had flown in for just half a day; how he argued for climate change solutions that don’t affect people’s finances; how his government was accused by the Conservatives’ own president of the previous Cop26 in Glasgow, Alok Sharma, of rowing back on its road to net zero pledge.

Sunak’s was a very public display, calculated to send a message. In the UK, a succession of U-turns has reinforced the impression of a change of heart – that Sunak is nowhere near devoted to combating a hotter planet than previously.

This culminated in Chris Stark, head of the UK Climate Change Committee, the government watchdog that advises ministers and assesses progress on targets, telling Laura Kuenssberg at the weekend that Sunak has “set us back” on climate change and left the UK at risk of falling behind other countries.

Stark said Sunak had “clearly not” prioritised the issue as much as his predecessors. He accused him of telling the world that the UK is now “less ambitious” than it once was.

Prior to Stark’s criticism of the Prime Minister – extremely rare from the head of a statutory body – the UK has witnessed a raft of ‘anti-climate change’ steps. They include: the reopening of the North Sea to fossil fuel exploration; rolling back on diesel and petrol new car bans so they will carry on being manufactured; renewing support for Heathrow's expansion; the scrapping of plans for household heat pumps and energy efficiency; and pressing ahead with a new deep-cast coal mine in Cumbria.

There have been ‘pro-green’ measures, including relaxing the ban on onshore wind farms and restoring the moratorium on fracking. But the overall impression is of a UK leader who no longer cares whether he is seen as ‘green’.

Electricity costs

Two reasons are being cited at Westminster for the PM’s shift. One is the cost. Going green is not cheap. As yesterday’s Resolution Foundation report found, implementing a low-carbon electricity system in the UK will require a four-fold increase in electricity investment over the next decade.

Sunak simply does not possess that sort of money. There is not sufficient spare cash in the national purse. And ahead of a possible election victory, Labour is already signalling the same, which does not augur well.

The other is that there are no votes in eco, not in the volume that could deliver Sunak an improbable victory. Those Red Wall constituencies that drove a Tory triumph last time are looking for investment in infrastructure projects, in hospitals, schools, transport and in tax cuts. What little he must play with, Sunak is going to use to try to woo marginal voters, not flex environmental muscle.

The result is confusion. Yes, he told Cop28 that he would not “burden working people” with the meeting of climate targets. But he did say that Britain had every intention of meeting them, just “in a more pragmatic way”.

In theory, the government still has a ‘Build Back Greener’ net-zero strategy. It’s also meant to be ‘powering up Britain’ with a net-zero growth plan. They may exist but they don’t seem as vital, as high a priority, as they once did.

Britain's then Prime Minister Boris Johnson, left, and Sir David Attenborough attend the launch of the UK-hosted Cop26 UN Climate Summit in 2001. AP
Britain's then Prime Minister Boris Johnson, left, and Sir David Attenborough attend the launch of the UK-hosted Cop26 UN Climate Summit in 2001. AP

Society takes its cue from those in charge. People and businesses always look for a steer as to how they should behave. Alarmingly, there are signs that business has made up its mind and that without government assistance, to make climate change initiatives worthwhile, some companies are prepared to push saving the planet to the back burner.

Fossil fuel enterprises have rushed to ready themselves to apply for the new licences to survey and drill in the North Sea.

Car manufacturers are revisiting their production plans. They are doing so in the knowledge, that like the oil and gas producers, they are no longer the pariahs they once were.

It’s the same at Heathrow, which speaks of "net-zero aviation", while the industry is busy dusting off the airport’s growth and development files after taking a low profile as the sector endured the stop-start legacy of Covid-19.

Similarly, fracking may be banned but lobbyists are quietly pressing the cause, believing they can see the granting of permission in sight once more.

Mining and quarrying, long off the agenda are very much back on again. It’s not only in Cumbria. Hanson UK, part of the giant Heidelberg Materials group, has submitted a planning application to double the size of its cement mining operation in another beautiful part of the country, in Rutland. This, despite widespread concerns about the impact on traffic, noise, dust and carbon emissions.

Heidelberg stress their adherence towards the decarbonisation of their sector, in providing low-carbon products and being 'Nature Positive'. However, granting permission to increase the site by a huge 120 hectares will be in direct conflict to the county council’s stated aim of reducing the impact of climate change, of achieving "net zero by 2050".

The quarry provides the raw material to make cement, yet cement contributes almost 8 per cent of global carbon dioxide emissions. When the building market is moving towards more sustainable materials, such as timber, the site is to expand, knowingly adding to pollution. At present, there are 1,575 HGV movements on the local A606 road daily; this will only rise enormously.

In Dubai, Sunak said “climate politics is close to breaking point”. As they look at where the UK is currently, other nations could be forgiven for thinking that in Sunak’s country they lie broken already.

Farage on Muslim Brotherhood

Nigel Farage told Reform's annual conference that the party will proscribe the Muslim Brotherhood if he becomes Prime Minister.
"We will stop dangerous organisations with links to terrorism operating in our country," he said. "Quite why we've been so gutless about this – both Labour and Conservative – I don't know.
“All across the Middle East, countries have banned and proscribed the Muslim Brotherhood as a dangerous organisation. We will do the very same.”
It is 10 years since a ground-breaking report into the Muslim Brotherhood by Sir John Jenkins.
Among the former diplomat's findings was an assessment that “the use of extreme violence in the pursuit of the perfect Islamic society” has “never been institutionally disowned” by the movement.
The prime minister at the time, David Cameron, who commissioned the report, said membership or association with the Muslim Brotherhood was a "possible indicator of extremism" but it would not be banned.

A Cat, A Man, and Two Women
Junichiro
Tamizaki
Translated by Paul McCarthy
Daunt Books 

Who's who in Yemen conflict

Houthis: Iran-backed rebels who occupy Sanaa and run unrecognised government

Yemeni government: Exiled government in Aden led by eight-member Presidential Leadership Council

Southern Transitional Council: Faction in Yemeni government that seeks autonomy for the south

Habrish 'rebels': Tribal-backed forces feuding with STC over control of oil in government territory

The National Archives, Abu Dhabi

Founded over 50 years ago, the National Archives collects valuable historical material relating to the UAE, and is the oldest and richest archive relating to the Arabian Gulf.

Much of the material can be viewed on line at the Arabian Gulf Digital Archive - https://www.agda.ae/en

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UAE currency: the story behind the money in your pockets
The alternatives

• Founded in 2014, Telr is a payment aggregator and gateway with an office in Silicon Oasis. It’s e-commerce entry plan costs Dh349 monthly (plus VAT). QR codes direct customers to an online payment page and merchants can generate payments through messaging apps.

• Business Bay’s Pallapay claims 40,000-plus active merchants who can invoice customers and receive payment by card. Fees range from 1.99 per cent plus Dh1 per transaction depending on payment method and location, such as online or via UAE mobile.

• Tap started in May 2013 in Kuwait, allowing Middle East businesses to bill, accept, receive and make payments online “easier, faster and smoother” via goSell and goCollect. It supports more than 10,000 merchants. Monthly fees range from US$65-100, plus card charges of 2.75-3.75 per cent and Dh1.2 per sale.

2checkout’s “all-in-one payment gateway and merchant account” accepts payments in 200-plus markets for 2.4-3.9 per cent, plus a Dh1.2-Dh1.8 currency conversion charge. The US provider processes online shop and mobile transactions and has 17,000-plus active digital commerce users.

• PayPal is probably the best-known online goods payment method - usually used for eBay purchases -  but can be used to receive funds, providing everyone’s signed up. Costs from 2.9 per cent plus Dh1.2 per transaction.

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.”

Results:

Women:

1. Rhiannan Iffland (AUS) 322.95 points
2. Lysanne Richard (CAN) 285.75
3. Ellie Smart (USA) 277.70

Men:

1. Gary Hunt (GBR) 431.55
2. Constantin Popovici (ROU) 424.65
3. Oleksiy Prygorov (UKR) 392.30

Updated: April 23, 2024, 3:05 PM