Economist Nicholas Stern discusses the downturn and its effect on the climate change agenda.
Excerpt: The economic slowdown has prompted some public and private leaders to question whether the world can afford to address climate change now, while others argue that green investments will stimulate the growth we need. There are thoughtful voices on both sides of the debate. In this exclusive video interview, noted economist Nicholas Stern makes the case for investment.
The interview was conducted by McKinsey's Matt Hirschland in Brussels on January 26, 2009. Click to watch the video, or read the transcript below.
"Two thousand and nine is a crucially important year. We are in the middle, I hope it’s the middle, of one of the worst economic crises the world has seen--ertainly the worst since the 1930s. We have to have a big fiscal stimulus package to pull us out of this. Monetary policy is moving in the right direction, but there’s a limit to what monetary policy can do. This needs a stimulus package probably around 4 percent of world GDP--around $2 trillion, taking all countries together.
"The second thing we must have in 2009 is a strong international agreement to deal with an even bigger crisis, which is the climate crisis. That, too, means that we’re under great pressure on time. The longer we delay, the more the greenhouse gasses build up, the more difficult the starting point for action becomes..."