IMPACT OF CLIMATE CHANGE ON BUSINESS

 IMPACT OF CLIMATE CHANGE ON BUSINESS

The biggest challenge in our globe over the decades has been climatic change. Climatic change has been recognized worldwide as a threat to both the present and future life. Irrespective of the expectation of people that climatic change will affect people in the future, the effect has also been felt in our present day. Climatic change is simply the changes that are experienced in the environmental temperatures. The rise in the number of floods and droughts experienced, experiencing heat weaves, and the sea level rising high and high. The effects caused by climatic changes are; poor sanitation, lack of adequate and clean drinking water, adverse air pollution both indoors and outdoors, and Irresistible diseases. Climate change has been felt in many countries, including Mexico, affecting the mode of doing business both directly and indirectly. Examples of business facing the climate change challenge are

1. Tourism industry

When the Country of Mexico is mentioned, people think about Sierra Madres, while others think about the Rio Grande. Sierra Madres and the Rio Grande are sites that have acted as the destination of many tourists visiting the Country of Mexico. Most famous people like Frida Khalo and Diego Rivera were born from those regions. The tourist attraction has been one of the primary sources of income for the Country. The presence of tourists in Mexico created many job opportunities for the local people, both the most educated and the less educated. However, the changes experienced in climate, interfering with the atmosphere in Mexico have affected the topography of the Country hence attracting fewer tourists in the Country. For the last decade, Mexico has experienced a drastic reduction in the number of tourists visiting the Country.

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1. Private sectors investing

Climatic change faced in Mexico also affects the private sectors investing in the Country buy the rise in hesitation in the world of business. The uncertainty is caused by the reduction in the availability of the natural resources, the swings in the volatility of price, and the threats to the critical industries’ security. Concerning the climatic changes happening, the business community needs to adjust and rescale to fit for the limited and scarce natural resources in the world. The government of Mexico should be more concerned about how it will redistribute the few natural resources existing to favor both the private sector and the government sector.

• Transport sector

Changes in climate have remained to be a significant threat to Mexico’s future. Climatic changes have led to different aspects such as low water levels, air pollution, and the high number of floods disrupting the traffic, landslides leading to vulnerability

HISTORY OF THE PARIS AGREEMENT

The Paris Agreement was an agreement concerning the climatic change facing the globe to lower harmful emissions in the air and strengthen the worldwide fight for the difference in climate by bringing different countries together. The Paris Agreement was brought on the table on December 12th, 2015. Out of the one hundred and ninety-six countries that signed the pact, only one hundred and seventy-six ratified the agreement. The Paris Agreements’ main aim was to reduce the emission in the environment and find methods to curb the rising temperatures in the globe(Kotlikoff, 2016). The countries which participated in the Paris Agreement felt that the climatic change was too irresistible, and immediate action was required to moderate the temperatures between 2 degrees Celsius to 3.6 degrees Celsius. Some of the small countries that took part in the Paris Agreement were awarded an amount totaling to 100 billion dollars. purposely to help to switch to greener sources, and the money was produced by the stable countries. France and India opened up an idea of the International Solar Alliance to support solar energy in the most developed nations. The developed countries also launched a project of clean energy research. The Paris Agreement mostly advocated the use of green energy; hence, it was against the use of nonrenewable energy. On June 17th, the United States withdrew from the Paris Agreement and went against the usage of green technology. The United States is the Country that emits the most significant percentage of greenhouse gases. Despite the United States opting out of the Paris Agreement, it still participates in the agreement but looks forward to getting out entirely by 2020. The United States is the largest emitter of greenhouse gases hence makes the Country more crucial in the Paris Agreement(Mendoza-Ponce et al,2019).

If the countries that took part in the Paris Agreement commits to reducing the greenhouse gases emitted, then global warming effects will reduce by b0.6 degrees Celsius every century. The next goal for the Paris Agreement is to neutralize the amount of carbon emission or have the carbon emission brought to zero.

HOW THE PARIS AGREEMENT WILL IMPACT THE GLOBAL BUSINESS

If a few organizations still could not seem to understand the certainty of the business network moving to an increasingly maintainable, reduced carbon condition, the Paris Agreement should, at least, urge top administrators to examine long haul maintainability. Although the climatic pact will not be accessible for signatory purposes until April 22nd, 2016, .it will go into power even later, business perils falling behind on the off chance that they do not think about the understanding’s effect on their supportability strategies (UNITED NATIONS CLIMATE CHANGE,  2015).

Stakeholders need to understand the main motives of the Paris Agreement which were;

• Reduction of the worldwide increment in temperature to about 2 degrees Celsius in comparison with pre-modern levels. In a perfect world, to decrease the adverse outcomes of environmental change, all human beings should plan to limit the temperature not to rise above 1.5 degrees Celsius.
• To speed up the reduction of greenhouse harming gases outflows and by the second half of the century to accomplish a harmony between GHG emanations and “greenhouse gas evacuation.” Specialists have considered this language a “net-zero objectives,” and recognized that understanding this equalization will probably include utilizing innovations equipped for expelling carbon from our environment.

Enforcing of the Paris Agreement will probably stay a discussed point for a considerable length of time, yet there’s little uncertainty every Country will execute enforceable governmental guidelines that compare to their separate NDC goals (Maxwell , 2016).For the private segment, this is the ideal opportunity to start adjusting corporate maintainability practices with center business methodologies, and finally, their Country’s NDC.

THE MEXICO NATIONALLY DETERMINED CONTRIBUTIONS

Mexico’s NDC are covering the reduced GHG emissions as well as black carbon emissions.In the efforts to Paris accord, this Country is applied BAU business as a usual concept and reduce its emissions by 25% ( Veysey ,2016).

• By the year 2030, this Country is targeting to reduce the GHGs by 40 %\
• There are complex impacts of global warming, even though the Mexico government understand that GHGs emission reduction could result in the environment and health benefits
• There is a need for implementing more policies to make Mexico get to achieve its targets
• This Country is taking considerable policy planning, and building institutions factoring the climate change impacts the new administration is bringing the Country to many more complication
• In 2012 April this Country adopted the general climate change law to lower the climate emissions by half by the year 2050
• In 2015 there was COP21 in Paris Mexico welcomed the agenda and came with clean energy policies in its transitional
• Mexico has made its NDS law consistently with the proposed objectives of the strategy of Mexico in mid-century that was received by UNFCC IN Nov 2016.
• Mexico Climate change mitigation is unfair, and this could end up failing to keep the warming below 2%
• Mexico fair approach to climate change is making it have a per capita emission that is related to glob leverage
• The current projection of Mexico is that inadequate budget I allocated to rehabilitation of fuel power plants this will increase global warning instead
• This Country has a carbon tax by 2014 aiming to reduce carbon emission
• Voluntary emission trading was started in 2017 ( Veysey ,2016).
• This Country has is delayed to entering into Paris agreement as planned by 2021

THE CURRENT STATE OF MEXICO ON PARIS ACCORD

Mexico ratified the Paris agreement on 21st September 2016.Currently Mexico is supporting climate change by accepting to use fossil fuels; the new budget under the administration of Lopez Obrador is allocated explicitly to gas, diesel coal, and fuelled plants modernization this has resulted in developing successful programs on renewable energy.

Mexico’s 2019 budget is considering rehabilitating the hydro and geothermal plants. This is in line with achieving clean energy as there is up to taking of new projects mostly on renewable energy (Maxwell , 2016).The new government’s decision to favor using fossil fuels such as coal over the renewable energy sources is mitigating the Paris agreement accord since every one wonders if Mexico will reach the limit of 1.5° C (Mendoza-Ponce et al,2019).It therefore very clear that this Country is most probably not going to meet the emission target by the year 2020, there is a need for implementing more policies like changing the decision on energy preferences, Since it set its target of reducing the greenhouse gas emission by 22%.

HOW BUSINESS IS DOING TO STAY WITHIN PARIS GOALS

• Develop objectives on keeping the environment save-this makes the business operators to get involved in the only company that has integrated climate change and sustainability. Meaning there will be little or no harm to the environment, for instance investing gin clean energy sustainably using water resources among others for example in the private companies operating in Mexico(Lewis ET AL,  2019).
• Mainstreaming climate change reduction targets in their business operation could also play a more significant role. For example, having companies that have little greenhouse gas emissions will keep the county within the Paris accord targets of below 2 degrees. For example the tourism sector is calling for conservation of wildlife and nature
• The creation of awareness on greenhouse gases mostly to both consumers and the business venture owners will result in positive consequences in reducing the global challenge( Ortiz-Partida et al,2019). Everyone will ensure that they involve in activities that consider reducing climate change impacts e.g. and clean energy sustainable farming practices

IMPACT OF THE LOCAL GOVERNMENT OF MEXICO

• To perfect the business sector in Mexico, the provincial government plays a significant role in giving the business operator the authority and freedom to operate within the different market centers as long as they meet the requirements. The government supports such business firms thought Offering license and business permits.
• Giving incentives to business people by supporting them with financial aids to cater for climate change and greenhouse emission control .moreover the government uses the taxes from such business to provide for climate change, for instance through Collecting revenues and taxes which help in the development of the Country better climate change strategies and policies implementation.

References

Kotlikoff, L. J., Polbin, A., & Zubarev, A. (2016). Will the Paris Accord Accelerate Climate Change? (No. w22731). National Bureau of Economic Research.

Lewis, G. B., Palm, R., & Feng, B. (2019). Cross-national variation in determinants of climate change concern. Environmental Politics, 28(5), 793-821.

 Maxwell , A.(2016). Mexico Ratifies the Paris Agreement:Retieved from: http://iki-alliance.mx/en/mexico-confirma-compromiso-acuerdo-paris-armonizando-ley-cambio-climatico

Mendoza-Ponce, A., Corona-Núnez, R. O., Galicia, L., & Kraxner, F. (2019). Identifying hotspots of land use cover change under socioeconomic and climate change scenarios in Mexico. Ambio, 48(4), 336-349.

Ortiz-Partida, J. P., Sandoval-Solis, S., Arellano-Gonzalez, J., Medellín-Azuara, J., & Taylor, J. E. (2019). Managing water differently: Integrated Water Resources Management as a framework for adaptation to climate change in Mexico. In Integrated Water Resource Management (pp. 59-72. Springer, Cham.

Veysey  .J ‎(2016). Pathways to Mexico’s climate change mitigation targets: A multi-model analysis retieved from:https://www.sciencedirect.com/science/article/pii/S0140988315001346

UNITED NATIONS CLIMATE CHANGE  2015 news : Mexico Submits its Climate Action Plan Ahead of 2015 Paris. https://unfccc.int/news/mexico-submits-its-climate-action-plan-ahead-of-2015-paris-agreement