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US and EU Must Learn to Share Power as Asia Takes a Larger Role

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With the United States looking set to step back from the international arena, China will likely take on an larger role to preserve the global economic system of which it has been a major beneficiary.

However, the future looks distinctly multipolar, with no single leader emerging to fill the leadership vacuum created by a US retreat. It is important that incumbent powers such as the US and the European Union make space for the rise of Asia and other centres of power.

Mustapa Mohamed, Minister of International Trade and Industry of Malaysia, who was personally involved in Trans-Pacific Partnership (TPP) negotiations, said the US withdrawal from the TPP will certainly have an impact on the world economy. He added, however, that China, India and ASEAN are growing fast, confident in their potential, and focused on creating jobs and making growth equitable and sustainable. While supporting the Regional Comprehensive Economic Partnership (RCEP) being negotiated between ASEAN and six neighbouring countries, and regional integration within Asia, Mohamed underlined the need to continue creating and expanding linkages with the outside world, perhaps by revitalizing the World Trade Organization.

“Things happen for a good reason,” said Li Daokui, Dean, Schwarzman College, Tsinghua University, People’s Republic of China, adding that the TPP was essentially a flawed idea because it makes no sense for a country far from the region to try to forge relations while bypassing China, the biggest trading powerhouse. He said that China would be the natural leader of economic integration in the region. China and ASEAN see eye-to-eye on this, he said, adding that this only leaves India, although China is keen to “get everybody on the bicycle … and pedal hard.”

The United States’ inward turn – at a time when other countries are forging partnerships and creating initiatives such as the BRICS New Development Bank, China’s One Belt, One Road initiative and free trade agreements in the Pacific – will harm the US the most, said Nouriel Roubini, Professor of Economics at the Stern School of Business at New York University, USA.

While China is the undisputed economic and trade leader in Asia, ASEAN is the “great untold success story of our times,” said Kishore Mahbubani, Dean of the Lee Kuan Yew School of Public Policy at the National University of Singapore. He said ASEAN has turned the “Balkans of Asia” into a highly prosperous and peaceful region, and has been a key player in the “miraculous, peaceful rise” of China by creating an enabling regional environment of harmony. The China-ASEAN relationship is marked by mutual respect, he noted, and their trade graph is rising steadily. Mahbubani also made a case for China assuming the leadership role to see RCEP through.

Anthony F. Fernandes, Group Chief Executive Officer of AirAsia, Malaysia, said there is significant intra-ASEAN start-up activity, and members must work towards making borders irrelevant, particularly for digital and fintech businesses, to fully realize the potential of this 700-million-strong market.

Li pointed out that China considers its relationship with the US to be most important, and said China’s leadership style – if and when it assumes greater leadership globally – will be very different from the style with which the US has led. Instead, he said, China follows a more Confucian philosophy of leading by action and not words.

Nevertheless, Mahbubani said, China must prepare to take a more assertive stance if the situation warrants, particularly since, as the world’s largest importer and exporter, China has the largest stake in maintaining a peaceful global system. At the same time, he added, incumbent powers must do away with “absurd rules“ such as those that reserve the top positions at the World Bank and the International Monetary Fund for a US and EU citizen, respectively, and prepare to share power with newly emerging countries.

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50 Firms Collaborate to Champion Next Gen Careers in Industry

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The World Economic Forum today launches the New Generation Industry Leaders (NGIL) programme, a global community of fast-rising young industrialists to accelerate environmental and social progress in manufacturing and production sectors, transforming perceptions and inspiring a new generation to take up a career in industry.

Over 50 world-leading companies in the production ecosystem, including Apple, DHL, Johnson & Johnson, Rockwell Automation, Siemens and Stanley Black & Decker, are supporting the NGIL programme. Beyond proposing their young leaders to join the community, these companies are making their training materials available to the community and executives are acting as mentors for the community members.

Emerging technologies are transforming industries as diverse as automotive, chemicals, electronics, healthcare and textiles. But industrial production is facing a skills shortage in all areas from R&D and design to consumer behaviour and end-of-use cycles. Research from global consulting firm Korn Ferry found that by 2030, there will be a global human talent shortage of more than 85 million people, which could result in $8.5 trillion in unrealized annual revenues. The New Generation Industry Leaders community will play an active role to address these challenges.

Mark Maybury, Chief Technology Officer of Stanley Black & Decker said: “Stanley Black & Decker is honored to contribute to the establishment of the NGIL community which fills a critical gap in the leadership development of future industrial leaders. This programme inspires the next generation through exposure to visionary industrial leaders, cross connecting this worldwide cohort to foster peer-to-peer learning and transforming their future by accelerating their growth and focusing their purpose on global challenges.”

Tanja Küppers, Chief Operating Officer of DHL Supply Chain Europe, Middle East and Africa, said: “New Generation Industry Leaders have the ability to push innovative minds and fire up the hearts of people to reach great heights of sustainable performance; by embracing connectedness with the business, society and environment they act as responsible leaders towards their workforce, customers and partners.”

Members of the New Generation Industry Leaders programme are nominated by senior executives from their respective companies and organizations. The first cohort of leaders numbers over 100, of whom half are women. They represent more than 20 countries and 12 industrial sectors, including energy, automotive, mining and metals. Each cohort of new leaders will embark on an 18-month journey embracing the following principles and activities:

· Get inspired: learning modules in strategy, leadership and operations, delivered by thought leaders, CEOs and senior executives from the production ecosystem.

· Connect: peer networking sessions to learn from each other’s unique workplaces and career experiences and to share ideas, challenges and solutions.

· Transform: smaller cross-industry teams to help accelerate responsible industry transformation and co-create new ideas to get the world excited about new opportunities and innovations in manufacturing and production.

Members agree to collaborate to drive positive change within each impact area in their own organizations, with the goal of leveraging their shared efforts to engage with and attract younger generations.

Jeremy Jurgens, Managing Director at the World Economic Forum, said: “The transformation in manufacturing and production being driven by the Fourth Industrial Revolution can only succeed with the leadership and collaboration of young professionals. We are thrilled to announce the launch of this inaugural group of exceptional leaders who will challenge their peers to embrace the incredible opportunities promised by a career in industry.”

Lawrence Whittle, Chief Executive Office of global technology firm Parsable, said: “Today’s factories are the most technologically advanced work environments in the world. So much innovation is happening in industrial sectors. But industry has an image problem – it’s not seen by young people as tech-savvy or future-focused. We urgently need to change perceptions around a career in manufacturing to attract and retain the finest talent from mobile-first generations.”

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Clean Skies for Tomorrow Leaders: 10% Sustainable Aviation Fuel by 2030

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Today, 60 companies in the World Economic Forum’s Clean Skies for Tomorrow Coalition – whose mission is to accelerate the deployment of sustainable aviation fuels (SAF) – achieved a milestone on the path to net-zero emissions by 2050 by working together to power global aviation with 10% SAF by 2030.

As aviation remains a “hard to abate” sector in reducing Green House Gas (GHG) emissions, strong climate action from the industry is particularly important as travel begins to return to pre-pandemic levels. Accelerating the supply and use of SAF technologies to reach 10% of global jet aviation fuel supply by 2030 is a significant move to put the aviation industry on the path to net-zero emissions.

This will only be possible through the concerted effort of industry leaders. The following organizations have signed the 2030 Ambition Statement:

  • Accenture
  • ACME
  • Airbus
  • Airports Council International
  • American Airlines
  • ANA Holdings Inc
  • Bangalore International Airport Limited (BIAL)
  • Bank of America
  • Biodiesel Association of India (BDAI)
  • Boeing
  • Boston Consulting Group
  • bp
  • British Airways
  • Caphenia
  • Carbon Engineering Ltd.
  • Cathay Pacific Airways
  • Council on Energy, Environment and Water (CEEW)
  • Deloitte
  • Delta Air Lines
  • Deutsche Post DHL Group
  • Dubai Airports
  • Enerkem
  • ENI
  • Fraport
  • Fulcrum BioEnergy
  • Heathrow Airport
  • Honeywell
  • Iberia
  • Indian Institute of Petroleum
  • International Airlines Group
  • Japan Airlines
  • KLM Royal Dutch Airlines
  • Kuehne+Nagel
  • LanzaJet
  • LanzaTech
  • McKinsey & Company
  • Neste
  • Norsk e-Fuel AS
  • Novo Nordisk AS
  • oneworld alliance
  • Ørsted
  • Praj Industries Limited
  • Punjab Renewable Energy Systems Pvt Ltd
  • PwC
  • Qatar Airways Group
  • Rolls-Royce
  • Royal Schiphol Group
  • San Francisco International Airport
  • Shell
  • SkyNRG
  • SpiceJet
  • Suncor
  • Sunfire
  • Sydney Airport
  • The Energy and Resources Institute (TERI)
  • TotalEnergies
  • United Airlines
  • Velocys
  • Virgin Atlantic
  • Visa Inc.

Signatory companies include airlines, airports, fuel suppliers and other aviation innovators from around the world. They also include non-aviation companies that rely on corporate air travel for their business operations, demonstrating that the responsibility of decarbonizing the industry lies with all those who depend on the aviation sector.

“Achieving our ambition will require commitment, innovation and cross-industry collaboration from a wide range of stakeholders,” said Lauren Uppink Calderwood, Head of Aviation, Travel and Tourism at the World Economic Forum. “We are calling on governments, international organizations and others to work with us to take important steps forward through new policies, targeted investments and regulations that create a level playing field while incentivizing transformation.”

This statement is also in full support of the UN High Level Climate Champions’ 2030 Breakthrough Outcome for aviation, one of over 30 sectoral near-term targets that are critical to halving emissions by 2030 and delivering the promise of the Paris Agreement.

Achieving net-zero aviation

SAF is fully compatible with existing aircraft and is a viable industry solution in the transition to 2030 and beyond. Members of the Clean Skies for Tomorrow Coalition are championing the commercial scale of viable production of sustainable low-carbon aviation fuels (bio and synthetic) for broad adoption in the industry.

Actors across the aviation eco-system agree on the need to first reduce, as far as possible, the emissions caused by the sector. This reduction can be achieved through efforts including the optimization of routes, increased energy efficiency from aircraft design and improved ground operations. Stakeholders such as airports can play an increasingly important role in the adoption and uptake of SAF by developing SAF operational plans or kickstarting co-funding mechanisms.

Synthesized from sustainable, renewable feedstocks – such as municipal waste, agricultural residues and waste lipids, or developed through a power-to-liquid route – SAF has already fuelled more than 250,000 commercial flights.

Difficulties remain in getting SAF to scale up production due to its prohibitively high price gap with fossil-based jet fuel, resulting in a “chicken and egg” problem with supply and demand. Costs will fall if production scales up, but fuel providers are facing headwinds due to high price pressure on low SAF demand, and high risks associated with policy and investment uncertainty. Demonstrating sufficient demand and policy certainty will be crucial to building investor confidence, hence the power of this major commitment from the leading companies in the aviation energy value chain.

Sustainable Aviation Fuel Certificate (SAFc) system

To make this concerted effort possible, the Clean Skies for Tomorrow Coalition has developed a Sustainable Aviation Fuel Certificate (SAFc) system, a new accounting tool that will allow SAF emissions reductions to be claimed by travellers and cargo customers if they are willing to cover the higher costs.

The proposed system also handles fuel supply chain logistics by delivering SAF stock to airports nearest the production plants. With existing technologies and digital demand platforms such as the SAFc, best-practice sustainable aviation can reduce GHG emissions on a lifecycle basis by up to 80%.

The key to long-term net-zero aviation will be to incentivize demand for SAF-fuelled air travel. With this ambitious 10%-by-2030 coalition commitment, members are motivated to aggregate demand for carbon-neutral flying. Some are championing mechanisms including co-investment vehicles, industry-backed policy proposals, and creative value-chain stimulus programmes for corporate passenger and transport business customers.

Expert Thoughts

“Progressing the development and commercial deployment of sustainable aviation fuel (SAF) is crucial to decarbonising the aviation industry. We are investing heavily in the development of SAF and have partnerships with Velocys in the UK and LanzaJet in the US which could see us powering our flights with sustainable fuel as soon as next year,” says Sean Doyle, British Airways’ Chairman and CEO. “Earlier this month we were delighted to collaborate with bp to source enough sustainable aviation fuel with respect to all our flights between London, Glasgow and Edinburgh during COP26, substantially reducing the emissions associated with taking our customers to and from COP26 by up to 80% compared to traditional jet fuel. We need continued support from Government to scale up the development and use of SAF, which will be a game changer for our industry.”

“Delta is looking to the future of sustainable aviation while addressing the current impact of our carbon emissions. It is why we committed to carbon neutrality in March of 2020 and why we have also committed to setting a science-based targets to align with the Paris Agreement,” said Ed Bastian, CEO, Delta Air Lines. “This partnership with Clean Skies for Tomorrow builds a future for sustainable aviation by bringing together a coalition that will accelerate the supply and use of SAF technologies.”

“Our announcement today to reach 10% SAF by 2030 emphasizes our commitment to the planet and prosperity. Upscaling SAF with a global approach will boost India’s economy,” Ajay Singh, Chairman & CEO, SpiceJet. “Accelerating the SAF industry with a global approach will bring opportunities for economic growth and transformation in India.”

“We’re proud to be joining forces with more than 50 companies collectively committing to powering global aviation with 10% sustainable aviation fuels by 2030. It’s a crucial milestone towards achieving net zero flying by 2050,” says Shai Weiss, CEO, Virgin Atlantic. “From partnering on sustainable aviation fuels with LanzaTech in 2011, to becoming a founding member of the Jet Zero Council, Virgin Atlantic has been leading on sustainability for more than 15 years. Our partnership with Clean Skies for Tomorrow is another step forward in accelerating the global transition to sustainable aviation.”

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Demand for Circular Economy Solutions Prompts Business and Government Changes

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To truly tackle climate goals, the world must transform how it makes and consumes. To support this effort, circular economy initiative Scale360° has expanded its reach from 2 countries to 20 in 2021, taking its unique approach to circular innovation and collaboration to cities, regions and countries around the world, triggering key changes for businesses and governments in how circularity is prioritised and managed.

Scale360°, established in 2019, leverages innovation ‘hubs’ to bring together leaders in science, policy and business to trigger circular change. They use Scale360°’s unique, tested methodology – the Scale360° Circular Innovation Playbook – to deploy Fourth Industrial Revolution technologies to rethink consumption and production, helping to transform the pipeline of future innovations.

The rapid growth of Scale360° demonstrates the growing demand for guidance on how to enable circular change and collaboration. Highlights from 2021 include:

● Circular Shapers: This initiative, launched this year, mobilised young change-makers in 12 countries to transform their cities into centres of circular economy innovation. Circular Shapers are competitively selected from the Global Shapers Community, a network of young volunteers in 448 city-based hubs around the world.

● Germany: Scale360° Germany is designing a consumer campaign to educate consumers on the environmental impact of ‘white goods’ (e.g., washing machines, etc.) and empower consumers to lengthen the lifespan of their appliances. This project has been developed in collaboration with Kearney and the Circular Valley.

● Singapore: This new program will improve the conditions for circular scalability in Singapore by engaging Singapore’s Deep Tech community and accelerating circular innovation collaborations between startups and corporates. Launched September 2021, this program was developed in collaboration with SGInnovate, a government-backed Deep Tech ecosystem builder and investor.

● Kenya, Bangladesh and India: In these countries, the 2030 Water Resources Group is leveraging Scale360° methodologies, tools and partnerships for scaling up circular economy solutions to improve water resource management in urban, industrial and agricultural sectors. 2030 Water Resources Group is a public-private-civil society partnership hosted by the World Bank Group.

● Argentina: McKinsey.org’s flagship initiative Rethinking Recycling – in partnership with Red de Innovación Local (RIL), a network of 200+ Argentine cities’ municipal decision-makers – will apply tools from Scale360°’s Circular Innovation Playbook to transform Argentine cities’ municipal waste management at scale, aiming to deliver substantive volumes of recyclables and compostables to industry, while also enhancing job opportunities and cost savings for cities.

This momentum comes in addition to the continued evolution of existing programmes. This year, the UAE established a dedicated UAE Circular Economy Council comprising ministers and C-level representatives across public and private sectors. The newly formed cross-ministerial council aims to ensure circular thinking across government is prioritised not only within the Ministry of Climate Change and Environment, but also across the Cabinet, the Ministry of Economy, the Artificial Intelligence Office and local government entities in each emirate. The council serves as a board of advisors for Scale360° in the UAE, and provides a platform for government, business and civil society leaders to share best practices in circular innovation.

“With these changes in place, we can create truly resilient systems that strengthen economies while pursuing the latest innovations,” said His Excellency Dr Abdullah Belhaif Al Nuaimi, UAE Minister of Climate Change and Environment and Chair of the UAE Circular Economy Council.

Chile’s SOFOFA hub, with the support of the country’s Ministry of Environment, is convening the country’s largest industry groups together to accelerate circularity by integrating value chains within sectors such as mining, energy, pulp and paper, food and beverages and more. Additionally, entrepreneurs, innovators and civil society members are actively working together to collaborate and build new circular business models at this critical time for the environment and economies.

“Circularity as a concept is still relatively nascent in this region, despite the critical role it plays in helping us achieve our sustainability targets. This is something we hope to change as part of the global Scale360° network, by integrating circular innovation into our mission of building Singapore’s Deep Tech economy,” said Dr Lim Jui, CEO, SGInnovate.

Such efforts pave the way for collaborations between cities, countries and regions and much-needed system-wide change. “System-wide change requires a system-wide re-thinking of collaboration,” said Shannon Bouton, President and CEO, McKinsey.org. “We are always partnering with those who are best placed to drive and scale change for maximum efficiency and impact.”

The wider adoption of Scale360° principles sets the stage for a more circular future as leaders rethink innovation. Added Scale360°’s Global Lead, Helen Burdett: “With every city, country and region, we are building a flywheel for change.”

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