Climate 'could hit Canadian GDP'

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29 September 2011 Last updated at 23:19 GMT Current federal estimates say climate change will cost Canada about $5bn a year by 2020 Negative effects of climate change could cost Canada the equivalent of 1% of its GDP by 2050 and 2.5% by 2075, a government-backed report has said.

Damage could reach C$41bn ($20bn; ￡27bn), estimates say, depending on global emissions, the economy and population growth.

Higher temperatures could kill forests, flood low-lying coastal areas and spread disease, the report said.

The panel denied that Canada would gain from global warming.

"Climate change presents a growing, long-term economic burden for Canada," said Canada's National Round Table on the Environment and the Economy (NRTEE).

'Strong, stable, responsible'

In a 162-page report, measures proposed included enhanced forest fire protection, pest control and an effort to foster the growth of climate-resilient trees.

The panel also recommended limiting construction in in low-lying coastal areas vulnerable to flooding, and developing technologies to limit pollution and slow ozone accumulation.

It said climate-related costs to Canada could increase from C$5bn in 2020 to between C$21bn and C$43bn by 2050.

These figures depended on co-ordinated global action to limit warming to 2C by 2050, the report said.

The findings of the panel were seized on by opposition politicians who believe the Conservative government should be doing more to confront the threat of global warming.

"Our coastal communities, our forestry industry, and the health of Canadians will all suffer unless we take action right now," said Laurin Liu, of the New Democrats, Canada's main opposition party.

"This out-of-touch government has produced no plan to deal with the impact of climate change," he added.

But Environment Minister Peter Kent said Canada needs "a strong, stable, environmentally responsible ... government to take care of the environment, and that is exactly what we are doing".

The report also said Canada had much to gain from an international, Kyoto-style treaty focussing on cutting carbon emissions beyond 2012.

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Could impact investing help India's poor?

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29 September 2011 Last updated at 08:34 GMT By Shilpa Kannan BBC News, Delhi Virender wants to grow his business of recycling plastic Sorting out plastic bags collected from rubbish tips is a serious business for Virender Kumar.

Sitting on a pile of plastic bags, he is busy giving directions to the labourers he employs to help him with the recycling.

Once the bags are sorted, he sells them to recycling units to be melted down into plastic pellets.

He makes about 20,000 rupees ($410; ￡262) profit every month. But he has bigger ambitions that need funding.

He says that by working overtime, he saved money to start the recycling unit. But now he wants to hire more people and expand the business.

"But everything needs money," he says. "Banks don't lend to people like me."

India's growing middle class has been a target for many companies, but now another segment of society is increasingly becoming a focus for investors - people living below the poverty line.

But can businesses make a profit and also serve a social purpose?

Loan controversy

People like Mr Kumar are now being wooed by financial institutions such as the Shriram Group.

While millions of people across India have little or no access to formal finance, investment funds which want to make a social impact are lending a helping hand.

These funds invest in people and sectors that traditional banks ignore. It is called "profit with a purpose".

But they are using insurance as a means of helping small businesses rather than loans.

Microfinance, or giving small loans to low-income borrowers, has received a lot of bad press in India recently.

The sector was booming until a spate of suicides by borrowers in the southern state of Andhra Pradesh led to the authorities tightening regulations.

At its peak, the microfinance sector saw almost $7bn in loans distributed to 30 million borrowers, and Andhra Pradesh accounted for a third of the total business.

As a result of the new laws, debt repayments fell drastically and the entire sector is now facing a massive consolidation, and many lenders have been forced to shut up shop.

Microinsurance is different from microfinance as this provides a safety net to prevent people from falling back into poverty.

The International Labour Organisation describes microinsurance as a mechanism to protect poor people against risk (accident, illness, death in the family, natural disasters etc) in exchange for insurance premium payments tailored to their needs, income and level of risk.

If a person earns $5 a day, making $150 a month, and a typical insurance product is under $4 a month, that person is able to, with that very limited amount of capital, free their family up substantially.

Having that extra protection means that instead of sending the children to work to save for a rainy day, they can send them to school.

Capital injection

Leapfrog is a $135m US-based impact investment fund that was set up to invest in companies that underwrite or distribute insurance.

The fund is backed by billionaire George Soros and e-bay founder Pierre Omidyar, as well as a consortium of banks, pension funds and reinsurers.

Leapfrog says that it is a big myth that because people have low incomes they are unable to pay for meaningful products.

"We are looking at the next billion consumers," said Andrew Kuper, co-founder of Leapfrog.

"The consumers who are rising out of poverty and into the middle-classes… aspiring, seeking to acquire financial services and other services that allow them to go on their journey in a more effective way."

He thinks businesses that serve that segment are going to have a massive competitive advantage.

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The ability with a very small percent of your income to totally reshape your microeconomic picture is a huge opportunity”

End Quote Andrew Kuper co-founder, Leapfrog "The ability with a very small percent of your income - less than 4% - to totally reshape your microeconomic picture and the daily choices that you and your family make is a huge opportunity.

"What isn't happening is companies getting to grips with the notion that you can serve that population, and we find that it is a very narrow slice of companies. Fortunately we are engaging with them."

More than 85% of Shriram Group's customers are first-time buyers of any financial product. It is the first provider to more than 98% of its customers. The group hopes that the capital injection from Leapfrog will benefit 10 million people in India.

G S Sundararajan, managing director of Shriram Capital, says his company is targeting people with an average annual income of $2,500.

"We already offer financing and investment services to the lower-income masses across India. Now, we plan to increase it even further. We'll be using Leapfrog's expertise to design new insurance products that are more effective for our existing consumers."

Huge potential

Microinsurance is not a new concept in India. The country was one of the first to introduce microinsurance regulation.

The Insurance Regulatory and Development Authority (IRDA) made it mandatory for all formal insurance companies to extend their activities to rural and social sectors as early as 2002.

But microinsurance companies face a huge challenge in connecting with customers. Many companies have been trying creative ideas - for example, the Shriram group is using its transport finance wing to connect with truck drivers and sell products to them.

India's biggest fertiliser company, IFFCO, provides free insurance cover to farmers along with each bag of fertiliser purchased. It has a joint venture with Tokio Marine and Nichido Fire Group, the largest listed insurance group in Japan.

It also provides a cattle insurance policy that covers the death of the animal due to accident, disease, surgical operations, strike, riots and even acts of terrorism or an earthquake.

A loan increased Virender's profits by 50%, by helping to pay for a new truck

The potential is huge. A study by the United Nations Development Programme (UNDP) in 2007 reported that up to 90% of the Indian population, or 950 million people, were excluded from the insurance market and represented a powerful "missing market".

But the private sector is risk-averse when it comes to investing in such people.

And just government resources and charitable donations cannot address the enormous social problems the country faces. Impact investments offer an alternative.

Reducing poverty

Recognising this growing segment, the biggest newspaper in the country, The Times of India, in association with J P Morgan, has announced awards for social impact.

Rahul Kansal is the organiser of the awards and he says that there are opportunities beyond just microinsurance for social impact in the country.

He says that large scale private capital can be channelled to public works.

"Increasingly we are seeing that in a country like India, there are avenues like healthcare, education, civic areas like waste management which need attention."

"The government cannot cope with the size of the problem. This is where organisations both for profit and non-profit can step in."

He thinks this large-scale neglect and need could be the next big investment opportunity.

A loan helped finance a new truck for Virender Kumar, increasing his profits by more than 50%. But he has also got life insurance and accident cover that came bundled with his truck financing, to protect his family.

It is people like him that are benefiting most by impact investments. Reducing poverty requires not just the generation of income among the poor, but also the protection of these incomes.

They are people who are making the transition from the informal to the formal economy - and bringing financial products to them gives them a chance to be included in the country's rapidly growing economy.

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Fungi could protect rice against climate change, researchers say that

A farmer working in a rice field plantation. Photography: Guang Niu/Getty Images

Inoculár are seeds of rice with mushrooms is more tolerant of salt, drought and cold plants, which may become more common as changes in climate, according to researchers.

Researchers obtained two types of fungi is known, that have symbiotic (mutually beneficial) relationships with plants. One was coastal dunegrass and the other of a variety of Strawberry that thrives on soils geothermal even in winter below freezing temperatures.

When two varieties of commercial rice seeds were inoculated with the mushrooms, the resulting plants, cultivated in greenhouses, growth and grain production has increased and were more tolerant of drought.

In addition, plant inoculadas fungi of coastal plants thrived under saline conditions and host fungi from wild strawberries grew well at low temperatures, according to research published this (July 5 month) in PLoS One.

"The fungus makes it all work," said Russell j. Rodríguez, co-author of the research and a microbiologist with the geological inspection. "In 24 hours, we have seen the benefits." "[Inoculated] plants grew to five times faster".

Technique does not change the genetic material of plant rice, his DNA, he said. "But changes the expression [switching on and off] genes and the plant now has the ability to resist environmental stress," he told SciDev.Net.

Researchers do not understand the mechanism, but they suggest that fungi could produce a substance that regulates the growth of plants.

In its symbiotic relationship with the plants, fungi confer tolerance to stress by nutrients, a phenomenon known as 'symbiogenics' because a symbiotic partner influences the expression of other genes.

The technique should work for different varieties of rice and other crops, like corn and peas, said Rodriguez, adding that researchers are trying to now make rice plants heat too tolerant.

Glenn Gregory, who studies plants tolerant to stress at the International Institute for research of rice in the Philippines, said the experiment on salt tolerance was "impressive and very promising".

But more experiments are needed to see if the rice thrives under field conditions, he said, because the fungi often require specific habitats, such as geothermal soils, to survive.

"In field conditions, the soil and the overall environment [are] ' contaminated' with other agencies, which can also interact with the plant and, in essence, to compete with the fungus," said Gregory.

RODRIGUEZ said his team has been working with Korean and African scientists to test the findings in the field.

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National Trust warns planning changes could cancel field

(NPPF) national planning policy threatens the green belt, warn environmentalists. Photography: Richard Saker

London green belt could be sacrificed to urban expansion of Los Angeles-style of low economic growth gave radical planning system reforms announced by the Government this week, the National Trust has warned.

3.6 Million member organization expressed its "serious concern" Tuesday by the Government's proposals to cut 1,000 pages of policy planning to only 52 pages in a move that has won the backing of timbre of developers.

Opponents argue that the new draft policy effectively eliminates the national goal of recycling brownfield land and allows local communities to support the building in the green belt. It is set to be the biggest change in the planning system in more than 60 years and guidance notes decreases detailed planning and circulars. Instead, the Government insists that there should be a presumption for "sustainable development" to House a growing population.

(NPPF) national planning policy framework seeks to accelerate and simplify the often complex laws at the same time as encouraging economic growth. In a foreword to the new policy, Greg Clark, the Minister of decentralization, said: "we must accommodate new forms that will earn our living in a competitive world..." "Sustainable development must go forward, without delay".

Fiona Reynolds, director general of the National Trust, warned that the policy could lead to growth that is excessive in the field on a scale not seen since the 1930s.

"The Government's proposals allow financial considerations dominate and this is huge risk in our field, the historic environment and precious local places that people value", said.

"This sounds finally death sentence the principle established in the 1940s used the planning system to protect what is most special landscape."

The new policy was developed with the help of a "consultative group of professionals", whose members include a conservative Councillor, director of the firm of Taylor Wimpey housing construction, a consultant for planning representing major developers at Government level and a staff member of the Royal Society for the protection of birds.

"Through the replacement of more than a thousand pages of national policy with around 50, written clearly and simply are enabling individuals and communities in the planning," said Clark.

But the changes to planning are likely to produce a popular reaction, according to environmentalists. The National Trust is asking its members to sign a petition urging the Ministers to reconsider.

Shaun Spiers, Executive Director of the campaign to protect rural England, said the Government have declared "open season" field not designated as green belt or an area of natural beauty.

"The new framework will make the field and much less safe from harmful and unnecessary development local character," he said. "If it is not changed, there will be battles against the development throughout the country that will make the public revolt against the sale of forests as a tea party."

The campaign for better transport and friends of the Earth have also attacked the plans.

The activists said that if the proposals were not amended could be counterproductive in the Government in the same way that plans to sell the forest estate in England, this year has resulted in an embarrassing turn of 180 degrees.

Ominous for the Government, many of the same groups opposed to the sale of the forest are at the forefront of criticism of the project NPPF, published Monday by the Department for communities and local governments. Most of the groups object has strong representation in constituencies held Tory.

Britain's largest property companies welcomed the proposals, saying it would help boost economic growth and create jobs.

"It is refreshing to have a concise national planning framework which supports and promotes the growth and at the same time protect our heritage," said Francis Salway, Executive Director of land securities.

"Focus on economic growth is very welcome, recognizing also the important role which the planning has to protect the environment," said Chris Grigg, Executive Director of British land. "We welcome the presumption for sustainable development".

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