OPINIONISTA: Acting with speed and certainty is vital if SA is to attract investment to help finance a just transition

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Understanding the physical and economic risks posed by the climate transition is essential, as we start to position ourselves to approach the complex question of balancing energy security in the context of this transition.

The Collins Dictionary annually selects a word that describes the preceding year. This word is selected for the way it captures the general essence of the year in question: so, of course, 2020’s word was “lockdown”, and “vax” was chosen somewhat more hopefully for 2021.

Perhaps what’s important, is to start by recognising that we are not talking about an either/or situation here. We are talking about the necessity to do both. The European Union, a major trade partner, is already introducing carbon border tariffs to protect investments in greener production from goods and services produced in carbon-intensive economies.

For the mining sector, these have to be in the so-called “minerals of the future” and include rare earth minerals, lithium for battery storage and the platinum value chain, where South Africa already has an established advantage. In our case, outside of the formal United Nations framework, an initial amount of $8.5-billion has been offered by a number of developed countries through a combination of financial instruments, including grants and concessional loans, as a first, small step to help finance the country’s just transition.

 

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