UNCTAD Trade and Development Commission, fourteenth session
22 April 2024
Excellencies,
Distinguished Delegates,
Ladies and Gentlemen,
It is my great pleasure to welcome you to the fourteenth 14th session of the UNCTAD Trade and Development Commission.
Although I am unfortunately not able to be presentially with you today, I will be following with great interest the results of your deliberations this week, as you examine two fundamental issues in the fight against climate change: Critical energy transition minerals and sustainable maritime fuels.
Critical minerals are the backbone of clean energy technologies and the energy transition.
According to the International Energy Agency, reaching net-zero globally by 2050 would require the demand for critical minerals to increase three and a half times by 2030, with even steeper demand for key commodities such as lithium (8 times), graphite (7 times), and nickel (7 times).
Most of these commodities are present in the developing world, and especially in Africa, home to 48% of the world’s reserves of cobalt and manganese, 80% of the world’s reserves of phosphate rock, and 92% of the world’s reserves of platinum-group metals. According to our latest Economic Development in Africa Report, and our LDC report, both released last year, this means we now have a historic opportunity to unleash a wave of structural transformation in some of the countries that need it most.
Developing countries rich in critical minerals face a unique opportunity to diversify their economies and move up the value chain. However, we must avoid the pitfalls of commodity dependence and unsustainable mining practices.
Ambitious policies have been adopted by some developing countries in this direction, and this Commission will provide a platform to exchange some of these practices.
In our latest World Investment Report, we formulated recommendations for a Global Action Compact for Investment in Sustainable Energy for All, with the goal of ensuring that trade and investment policy are also part of the solution.
UNCTAD also supports the Panel on Critical Minerals, established by Secretary-General Guterres at COP28, by providing analysis on the trade and development aspects of this sector. Your deliberations here will further enrich this crucial work.
This week you will also discuss decarbonization of maritime transport and a shift to cleaner fuels. This shift brings with it both great challenges and even greater opportunities.
As regards to the challenges, cleaner and sustainable fuels tend to be more costly and have lower energy density than traditional fuel oil. Ship owners need to invest in newer and different ships. Ports need to get ready to have the infrastructure necessary to provide fuel for those ships.
And economies as a whole need to generate alternative fuels to the bunkering centers.
As regards opportunities, the most obvious is the mitigation effect of making more sustainable an industry that contributes to 3% of all global house emissions.
Through sustainable fuels, developing country ports will also be able to become fuel providers, unshackling themselves from the old need of having large oil reserves of their own.
All of this represents a massive coordination and investment challenge, which can only be met through global, long-term commitments.
Previous energy transitions in maritime transport were ultimately self-funded, as the shift from rowing to wind, from wind to steam, and from steam to oil always led to lower costs for the private sector operators and investors.
The next energy transition can and should also be self-funded, but this can only happen if we ensure that operators and investors cover the total costs of shipping.
Because even if at first sight alternative fuels may appear more expensive, they are competitive once the real total costs of burning traditional fuels are factored in.
The best way to do so is through economic measures such a levies on greenhouse gas emissions, which UNCTAD supports through work under our three pillars, but we have been clear by saying very strongly that this levies need to support the most vulnerable developing countries, including small island developing states and least developed countries during the energy transition.
We are working very closely with the International Maritime Organization in creating the global framework that allows this ambition to materialize.
Last July the IMO tightened decarbonization targets for shipping and confirmed the development of new fuel standards and a pricing mechanism for greenhouse gas emissions – we at UNCTAD have been very involved in all of these initiatives.
Distinguished delegates,
The challenges we face in securing a sustainable future are complex. Yet, by working together, we can forge solutions that not only protect our planet but also drive economic growth and prosperity for all.
Let us leave this session with a renewed sense of purpose and a shared commitment to action.
Together, we can shape a future where the critical minerals for the energy transition and sustainable maritime fuels, power a cleaner, more equitable world for generations to come.
Thank you.
