In addition to being the founder and director of the Growth Laboratory at Harvard University and a professor at the Kennedy School of Government at the same academic institution, Ricardo Hausmann is a great connoisseur of the Colombian reality. Born in Venezuela and author of countless texts, he will arrive in the national territory next week to talk, among other topics, about the so-called ‘green transition’.

About, The academic maintains that for most countries the emphasis of their development policies should be to help decarbonize the planet, not from the point of view of reducing their own emissions, but rather by creating the products and services that the world will need. to be able to decarbonize. Reducing our own emissions as a priority threat with creating great headaches that generate few global benefits.

Regarding Colombia, the specialist makes statements that cannot be ignored, regarding its risks and opportunities. On this and other topics, he spoke exclusively with EL TIEMPO.

(Also read: Former Mining Director makes delicate revelations about oil report).

How are you viewing the debate on the need for countries to reduce their greenhouse gas emissions?

It is undoubtedly the most important debate of our times, because climate change is a reality and the threats of global warming cannot be taken lightly. But, made that sustained, it is important to take into account who is responsible for the large discharges of carbon dioxide into the atmosphere and in this it is clear that there are very large differences between countries. To give examples by name, nations as populous as Pakistan, Egypt or Nigeria – which together account for more than 500 million people or 6.7 percent of the world’s population – together represent less than 1.6 percent of the total carbon emissions. If these emissions were to magically disappear, they would have no material impact on what happens to the climate.

But even if they do nothing they will be affected…

Of course. On one side is the risk of natural catastrophes like the one that affected two-thirds of Pakistanis a few months ago. On the other hand, there will be less demand for goods and services linked to polluting sources, and more for those that come from cleaner and greener sources. So the real question is how to jump on the bandwagon of fast-growing industries that will help the world reduce its emissions and reach the promised ‘carbon neutrality’, which is equivalent to net zero emissions.

And is that possible?

Undoubtedly. Just as in eastern Asia and Europe, where many economies have evolved from relatively basic manufacturing processes, such as textile production, to more sophisticated sectors including electronics, machinery, or chemicals, others may follow a path that combines manufacturing part with sustainability. I have no doubt that many plants will be located in countries that are competitive in clean energy, such as those in Latin America.

Before talking about the region and Colombia, you have mentioned six specific issues. which son?

The first is that you have to gamble for global electrification, since almost three quarters of CO2 emissions come from the use of energy. But the origin of that energy must be sustainable, through sources such as wind and solar radiation. Hydrogen, ammonia and even hydroelectric dams can be used as forms of storage of that energy. The electrification forced an enormous production of minerals, which will have to be multiplied several times. It is unquestionable that a mining boom is coming, today there is not enough lithium, because copper or nickel, to meet the demand. Obviously, the challenge for places rich in these resources is to be able to expand production capacity and maximize the value they can create, including processing these primary goods and converting them into capital goods. Why do gigafactories of batteries or solar panels have to be in China, Europe or the United States and not in emerging countries?

Someone would answer that this is not so easy…

To lose. Obviously a series of conditions are required that include good rules of the game, but I am going to add something. Oil is incredibly easy to transport, which means that today, energy-poor countries can competitively export very energy-intensive products, such as steel. That’s not going to be true in a world of green energy, which is very expensive to transport. This will lead to a displacement of energy-intensive industries to places with cheap green energy. So the second point worth keeping in mind is that countries that are efficient in power generation from renewable sources can attract many industries. On the other hand, I am not clear about the idea of ​​exporting electricity because transporting it is very expensive. What is economically feasible is to locate industries close to where the renewable energy plants are. Latin America has many possibilities to highlight this scenario.

On paper, yes. However, the recent Davos summit insisted that because the emerging world finds it more expensive to borrow, that natural advantage may be lost…

If true. The cost of capital is a crucial issue, the third on my list. The sun shines, the wind blows and the rain falls freely, but the capital does not. I explain. Germany can get resources at 2 percent per year, while it costs the Dominican Republic at least 7 percent, so the advantage of having more solar radiation does not translate into lower production costs. For this reason, it is essential that countries manage their respective economies well, in order to reduce the cost of capital. I go to the example of my country. Venezuela has the largest oil reserves in the world, but go get the resources to develop them…

He talks about managing technological risks. What is it referring to?

Because technological uncertainty is always present. The truth is that we do not know which technology will end up winning the race in order to be the most suitable for reducing emissions. I already mentioned hydrogen, but we just found out that nuclear fusion, which seemed like a distant idea for scientists, has made enormous strides, not to mention other initiatives. In this sense, countries are obliged to keep their eyes wide open. Israel or Singapore follow the progress very closely, in order to be able to anticipate what is coming. Chile announced that it will invest in a lithium research center, but that project is on hold.

(You may be interested in: What is nuclear fusion? What you should know about the momentous announcement)

Amazon countries say they should be recognized for taking care of the forests that absorb carbon dioxide. Do you agree with that idea?

Of course. The countries obtained carbon credits for the fact of protecting forests and jungles or carrying out reforestation processes. The reason why trees continue to be felled in a disorderly manner is because an hectare dedicated to livestock is worth more than one dedicated to the protection of native habitat. The way out is to develop those markets, which must reflect a value per ton of carbon sequestered attractive enough to alter the balance.

When you talk to an official from any country on this topic, what other advice do you give them?

Countries should not look exactly at their own emissions and focus on ways to reduce them. Instead, they need to focus on how they can help the world achieve decarbonization.

Get ready to learn. I do not need to know about futurology to ensure that some will do the task and others will not. that they understand that this process is serious, take the appropriate policies and prepare those people, they will win. Those who fall asleep will see how investments and clean technologies will go the other way. The bottom line is this: countries should not look strictly at their own emissions and focus on ways to reduce them. Instead, they need to focus on how they can help the world achieve decarbonization. An extreme case is that of Bolivia: its carbon emissions are negligible, but its lithium reserves are the largest in the world. However, it is not exploiting them. It is more important for the world that Bolivia become rich by producing more lithium than that it become poorer by adopting costly measures to reduce its emissions. The strategy must be to create value and well-being at home helping the rest of the world to decarbonise.

How much do you know about the debate on this issue in Colombia and the proposals of the Petro administration?

Apart from the fact that what happens there always interests me, I was at the Davos Forum seeing the President and his ministers, so I know something. A reduction in Colombia’s oil production does not help the world, since it would stimulate production in other geographies, but it would harm the country. An increase in the production of hydroelectricity or the minerals needed for decarbonization can make the country richer and the world cleaner. The most worrying source of Colombian emissions is deforestation in the Amazon and other areas. This can be addressed by changing the incentives that today artificially stimulate livestock farming, while carbon sequestration is not certified and remunerated. If it were, instead of deforestation we would be seeing reforestation and a higher standard of living.

(Keep reading: What is the decarbonized capitalism that Petro talks about so much?).

What do you think of the idea of ​​reducing oil exploration and exploitation?

To put it very simply, the question is whether they are going to be part of the solution and not the problem. Ending the two main lines of exports in an accelerated manner can create more problems than solutions, especially if the Colombian economy gets into trouble. I have no doubt that it will be more difficult for a poorer country to end the deforestation that is still growing and achieve formal and well-paid jobs. It is very important that Colombia reimagine itself in that world of decarbonization.

For example?

The enormous mining potential that you have and that has not been fully explored. He refers to quartz of the highest purity, nickel or copper. If they do things right, the opportunity ahead is enormous, including creating high-tech industrial linkages. Added to this is the development of carbon credit markets. So there’s a lot to talk about about the potential for green growth, but in a less self-flagellant way. It is not about starting to reduce oil production, but that it accompanies the decarbonization of the world. So you have to focus on creating the necessary ecosystem so that green opportunities can grow.

Even so, the opposition to mining is great…

Countries are distinguished by their ability to minimize the ecological impacts of certain activities. Mining can be done well, regular or poorly, and what matters is learning from the experiences of others. In the case of Colombia, it is essential that the country study how to make extractive activities environmentally feasible. But I insist: it is not possible to save the atmosphere without scratching the earth.

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senior analyst
On twitter: @ravilapinto