Biophilia: Nature immersion and the city

By Jason F McLennan

In part one of a series about biophilia and its relationship to the built environment, Canadian architect and founder of the Living Building Challenge, Jason F McLennan, shares some insights around the central concept and specifically how it to relates to city planning and urban environments.

Canadian architect and founder of Living Building Challenge
Jason F McLennan

E O Wilson described biophilia in his 1984 book by that name as “the innate tendency to focus on life and life-like processes.” 

I first wrote about the importance of biophilia in 2004 in my first book, The Philosophy of Sustainable Design. I included biophilia as a guiding principle in version 2.0 of the Living Building Challenge (LBC) that came out in 2009; making LBC the first green building programme in the world to focus on the subject. Since then, I have watched the field of biophilic design evolve, gaining shape, definition, and serious consideration on projects all over the globe. 

However, as easily happens, a checklist mentality around biophilic design has emerged within the design industry, while simultaneously nearly anything and everything is being described as ‘biophilic’ in order to satisfy this newfound interest. As has happened in other areas of green building, the essence and scientific basis of biophilia is being lost in point tallying – right now, a design need only include superficial applications and check the right boxes to call itself biophilic.

It is my hope that clearly naming what is essential to biophilia, will engender a more nuanced understanding and ultimately, a more successful application of biophilic patterns and attributes to design.

Frameworks and checklists will always benefit designers, but it’s time to dig in deeper to what we mean when we talk about biophilia and biophilic design. We need to focus on design strategies that actually have positive impacts and do more than merely justify a design through yet another trendy lens. 

Science is only recently corroborating the long-standing, instinctual wisdom we’ve carried as humans for millennia – that we thrive in close connection to nature. I believe nature immersion is the single most important element of biophilia; if we only allow ourselves adequate time in nature, we can reap bountiful biophilia-associated wellness benefits.

Inside out

Estimates place 70 percent of the world’s populations in urban environments by 2050. With this migration, our connection to nature has dwindled and our feelings of isolation, loneliness and depression have filled the vacancy. Harvard School of Public Health Professor John Spangler puts a number to Americans’ disconnection from nature, and it’s shocking: we now spend 95 percent of our time indoors.

At the same time, a growing body of evidence suggests that if we reconnect to nature, we will become whole again.

Therefore, a key principle to establish under the framework of nature immersion is that any design that can get people outside, for as long as possible – using porches, covered walkways, courtyards, balconies, etc. – will always greatly outdistance anything that can be done inside a building. These types of design features prolong our exposure to nature, drawing down that 95 percent. The task isn’t the architect’s alone, but also the landscape architect’s, the urban planner’s, and that of each individual that occupies a building.

Immersive experience

Given so much of us live in, or are moving to, urban environments, we must, at a city planning scale, do the work of the biophilic designer to draw people outside through design. What do our cities look like? City parks provide immense opportunities for immersive experiences to urban dwellers and we should urgently create more, even on a small, pocket park scale. How many parks do we have now and how equitably are they dispersed? One recent, powerful study showed significant decreases in self-reported feelings of depression in test groups tasked with restoring vacant lots in economically-depressed urban areas.

Green Point Park, Cape Town

This study illuminates the social justice aspect inherent in any discussion about urban planning and access to nature: “neighbourhood physical conditions, including vacant or dilapidated spaces, trash, and lack of quality infrastructures such as sidewalks and parks, are associated with depression and are factors that may explain the persistent prevalence of mental illness in resource-limited communities.”

As the populations of our cities grow, it is important that the number of public places for city-dwellers to be in nature, keep pace. It is my belief that everyone should have walking distance access to a beautiful public park.

Native ecology

Also, as the world’s population continues to move into towns and mid-size cities grow into large cities; cities should strategically plan for and conserve sizable tracts of land as highly accessible urban wildlands. Stanley Park in Vancouver, Forest Park in Portland, and Central Park in New York City provide crucial, substantive outlets for high-quality nature immersion for their urban areas and highlight what’s possible when the conditions for wildness are fostered rather than subdued by design within city limits. These conserved parks connect people with place in a powerful way, often providing them with an experience of what their place once looked like while simultaneously creating opportunities for the native ecology of that place to thrive. Living in close proximity to this kind of life has amazing potential to foster the stewardship mentality crucial to the conservation of our wild places.

Creating connections

What further opportunities can we identify to foster nature connections in cities? Do trails winding through untamed places connect us to the modern and convenient amenities that spurred our move, as a species, to cities? If not, can they? What is the state of our urban canopy and how can we revitalise it, and reap the associated biophilic benefits, alongside all the others, that make trees so essential to city landscapes? What is our relationship to water in our cities? Can we utilise design to daylight streams and stormwater, creating visual and auditory onnections with our life-source at every opportunity? Are our cities walkable and bikeable, with amenities spaced for pedestrian and biker access? 

I believe one of the reasons Americans flocked to the suburbs in the post-World War II era was for these kinds of natural connections that had been choked out of industrialised cities. As our urban populations rise, it is critical that we invite nature back into city centres, creating nature-pedestrian connections that get us walking and interacting with our surrounding natural and human communities, immersing us more often and more completely within biophilic settings.

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Bridges of Hope

Nelson Mandela once said: ”A good head and a good heart are a formidable combination.” Every year, on the anniversary of his birthday, 18th July, the world celebrates Mandela Day. It is not meant as just a public holiday, but a day to honour the legacy of the great man, and his values, through volunteering and community service. Mandela Day is a global call to action that imparts the idea that every individual can contribute to the collective, to make a positive impact to the world. Sika SA rose to the occasion, and this time we celebrated by aiding Bridges of Hope.

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Orania Wastewater Treatment Plant

Orania, a Karoo town in the Northern Cape, named after the Orange River flowing alongside, has experienced rapid population growth in the last few decades. Consequently, the wastewater plant did not have adequate capacity to cope and a new one had to be built. The appointed contractors were Orania Infrastruktuur and they conducted the project from March through to mid-December of 2021.

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Introducing RhinoBoard® plasterboard, now with EcoTech™

As the world leader in light and sustainable construction, Saint-Gobain, have affirmed their commitment to becoming carbon neutral by 2050 with the introduction of additional products and carbon neutral manufacturing plants around the world.

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In with the old: taking the long view when restoring grasslands

Restoration science and practice are critical in combatting the loss of old-growth grasslands and the loss of biodiversity.

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Entertainment venue calls on rope access expertise from Skyriders

When a major entertainment venue in Gauteng realised a suspended speaker in an open-air area had come loose, posing a safety risk to patrons, its first call was to Skyriders Access Specialists Pty Ltd. The rope access specialist put together a team at short notice and was able to secure the speaker quickly and without disruption.

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How much do we waste? A data-driven guide to waste and landfills

Waste is a global issue. From electronic devices to unused food, a lot of what is thrown away ends up in a landfill. While concerted efforts are being made across the globe to incorporate recycling initiatives, these endeavors can quickly go astray when rubbish isn’t handled with the correct care and attention.

This comprehensive guide takes a closer look at the question posed in the headline: how much do we waste? The article also details where it ends up, how recycling and other solutions can help with the problem, and how businesses can manage waste. With how waste continues to mount up, tacking the problem head-on is crucial – otherwise, the environmental impact it provokes will have further consequences for the planet.

How Much Do We Throw Away?

To get a greater idea about waste and the concern it poses, it’s essential to take a closer look at just how much is thrown away. There are many different forms of waste, with some of the main culprits including:

· Electronic devices

· Hazardous materials

· Discarded food

· Plastic

· Paper and paperboard

· Textiles

· Metal

· Wood

If this waste isn’t correctly managed, there’s ultimately only one destination it will end up: a landfill. Add in factors such as population growth, the continued demand for disposable products, and the short shelf life for everything from smartphones to sneakers, and there are many reasons why waste continues to build at an alarming rate.

The following statistics help to illustrate the worrying picture.

Waste statistics

Whether you’re analysing global figures or centering on the United States, the situation is far from healthy – and that’s putting it mildly. Waste is a massive issue, and the following statistics demonstrate why this is the case.

· Annually, 2.12 billion tons of waste is produced across the world.

· Of that waste, 1.3 billion tonnes is made up of food. That’s over three trillion meals each year wasted, approximately one-third of all food generated for human consumption.

· At least 33% of the planet’s waste is not managed in an environmentally safe way. That’s only a conservative figure, which means the percentage could ultimately be even more frightening.

· The average daily waste per person averages 0.74 kilograms worldwide. However, the range for this can vary drastically depending on location. This goes from 0.11 kilograms to 4.54 kilograms.

· By 2050, it is expected that global waste will grow to 3.40 billion. This growth is more than twice the population growth during the same time period.

· Annually, it is estimated the world’s oceans are polluted by 10 million metric tons of plastic.

· 12% of the world’s trash comes from America. This is despite the country only making up 4% of the globe’s population.

· In 2018, America was responsible for producing 292.4 million tons of municipal solid waste. That’s almost 5 pounds per person, per day.

· The waste management market in North America was valued at $208 billion in 2019. The U.S. accounts for most of the market.

· The U.S. manages 35.2 million tons of hazardous waste.

· Each year, estimates suggest the U.S. produces around 103 million tons of food waste.

· Due to household leaks, the average U.S. family can waste 180 gallons of water each week, or 9,400 gallons per year. That’s the same amount of water required to wash over 300 laundry loads. On a nationwide scale, household leaks can lead to almost 900 billion gallons of water being wasted annually.

· America currently has a recycling and composting rate of 32.1%.

· 25 million plastic bottles are thrown away each hour in America.

Where Does Our Waste Go?

In general, there are two places where our waste ends up: in a landfill or recycling. The latter is obviously the aim, especially with the environmental benefits and government incentives on the table. However, recycling is not always an option. Plus, even when it is an option, this doesn’t mean organizations will take the necessary steps to make it a reality. In these situations, waste goes to the landfill.

If you operate a standard modern business, here are some stats to consider about the type of waste produced – and where it ends up:

· Every year, 500 coffee cups are used by the average office worker. These are single-use cups, meaning they are all sent to landfills.

· 20 companies are responsible for producing over half of the globe’s single-use plastic. All of this eventually goes to landfills.

· The standard office worker generates approximately two pounds of paper and paperboard waste each day. They also use around 10,000 sheets of copy paper annually.

· Mixed paper products account for about 70% of total office waste overall.

· Globally, more than 50 million metric tons of electronic waste were generated in 2019. This is expected to rise by a further 20 million metric tons over the coming decade.

· At present, only about 20% of electronic waste is recycled on a global scale.


In 2018, approximately 146.1 million tons of municipal solid waste (MSW) ended up being landfilled in the U.S. While this isn’t a welcome figure, there has been a steady – if slow – improvement over landfill numbers compared to the amount of waste produced. In 1960, 94% of generated waste was landfilled. In 2018, this percentage decreased significantly to 50%.

How it works

Landfills have come a long way since they were simply large open dumps for waste to be tossed into. These days, sanitary landfills exist, which help prevent numerous problems that traditional landfills caused – such as toxic chemicals and gases contaminating the surrounding soil, groundwater, and air. By separating waste via a system of layers, sanitary landfills are designed with the intention for waste to decompose safely. Although methane can still be produced, most sanitary landfills will collect this gas, keep it out of the earth’s atmosphere, and utilize it to produce electricity.

The deepest spot in a sanitary landfill can be found 500 feet into the ground. The bottom will typically feature dense clay alongside a plastic liner to stop liquids from seeping through. Certain wastes generate liquid as they decompose, so a drainage system is used to carry contaminants to a treatment facility. As mentioned above, a modern landfill will also incorporate a gas collection system for the produced methane.

When trash is delivered to a landfill, it is compacted so it takes up less room. A layer of dirt is also used to cover new trash, helping to deter pests and contain odors.


The majority of waste can be recycled. In fact, according to research conducted by the EPA, it is estimated 75% of the U.S. waste stream is recyclable. Sadly, only about 30% of this waste is actually recycled. Going on a global scale, it is said that 91% of plastic still isn’t recycled, while the recycling rate for PET bottles in America sits at a lowly 30%.

The good news is that attitudes are slowly changing. Recycling is becoming more and more prevalent, and this shouldn’t be a surprise based on the numerous benefits gained. As an example, in 2019, the U.S. took 25 million tons of combustible MSW and converted it into approximately 13 billion kilowatt-hours of electricity.

When you consider how recyclable certain materials are – 95% of textiles can be potentially recycled or reused, for instance – a lot of waste can be diverted from going to landfills, and instead be repurposed in ways that are more advantageous to the environment.

How it works

The process first begins by collecting recyclable materials. For a business to do this effectively, it will have its own system in place for collecting, processing, and storing suitable recyclables. This will include dedicated containers for specific materials, along with a baler to compact recyclables for easy storage and transport.

When the materials end up at a recycling center, they are sorted by type. Specialist machinery will separate paper from plastic, metals from cardboard, etc. Workers at the center will also separate soiled recyclables from clean ones. If a recyclable is soiled, it will either be cleaned or thrown away if deemed unusable.

Once a recycling center has processed and broken down the recyclables into raw materials, they can then be used again to create new products. The center will sell the recycled goods to manufacturers.

New waste disposal technology

In the continuing efforts to improve and refine the recycling process, new waste disposal technology is being used. Simply put, if waste management doesn’t undergo sweeping changes, many existing waste issues will only inflate into something more damaging. It is said if changes are not made, in 2050 oceans will contain more plastic than fish.

Smart waste management technologies include everything from waste level sensors to pneumatic waste pipes. However, one of the most effective technologies a company can incorporate is smart waste bins. During the essential initial sorting process, human error is taken out of the equation by smart waste bins. This makes material processing easier and faster, and it can drastically boost employee efficiency and reduce waste management costs by up to 80%.

Managing business waste

Did you know 57% of consumers are open to changing their purchasing habits if it means reducing negative environmental impact? This means if your business can clearly display its effort and commitment to sustainability, it can open the door to attracting new customers.

To make it a reality, you need to know how to manage business waste successfully. Below are a few tips on dealing with common waste types.

Everyday waste

With everyday waste such as paper and plastic, it is important you sort and correctly store these materials. Having a secure place to store waste is the first step. You will also need to use clearly labeled containers to separate and collect the waste.

You have to take particular care when storing waste, particularly if they’re in a place where the elements can cause issues. If covers are not used, waste can be blown away. If these covers are not waterproof, it could also lead to rain affecting your stored materials.

Electronic waste

Electronic waste, also known as e-waste, is going to become an increasing concern for businesses. Fortunately, a business can take steps right now, such as moving a lot of technology and processes to the cloud, which can immediately reduce their electronic waste.

If you have electronic waste which has no future purpose for your business, there are various steps you can take. There are specialist third-party electronics recyclers that can take care of these materials in a cost-effective, environmentally-friendly way. There’s also the possibility of trading-in devices for upgrades or donating them to local charities to expand their lifespan.

Hazardous waste

As you would expect, extra steps have to be taken when you’re handling and processing hazardous waste. If this hazardous waste was to cause damage or harm to others, it could lead to significant ramifications for your business. Materials deemed hazardous include chemicals, solvents, batteries, oils, and pesticides.

First, begin by ensuring all hazardous waste is separated from non-hazardous waste. You will then need to store the waste responsibly. That means using applicable containers, keeping them out of the elements, and storing them in a safe, secure place. Once you have used an authorised waste carrier to handle your hazardous waste, you’ll have to keep a record of any waste transfers you make.


Waste is a major problem that the world is currently facing. This problem will only become further exacerbated if landfills are opted over recycling. Although landfills are no longer quite the giant headache they once were, they’re also far from the ideal way to deal with waste.

A lot of waste is produced in the U.S. and across the world. The many points of data highlighted in this guide demonstrate this clearly. However, with a more sustainable-driven approach, where materials are recycled, and the likes of single-use plastics are eliminated, there’s hope for the future that waste will no longer be the problem it currently is for the planet.

Useful links

You can find out more about landfills, how they function, and their average life expectancy here:

You can learn more about how the EPA is working to clean up electronic waste here:

The EPA also has a detailed guide on how small businesses can effectively manage their hazardous waste. This can be downloaded on this page:

Learn more about current technologies which are used to divert waste from landfills here:


What happens to landfill waste?

Landfills are generally designed to store waste rather than break it down. However, when it’s placed in a sealed, oxygen-free environment, landfill garbage will decompose – although this is a slow process. Plastic bags, for instance, can take up to 100 years to degrade.

How can my business reduce waste?

There are various steps you can take to reduce business waste. You can provide employees with reusable bottles instead of single-use cups. You can go paperless with a more digital approach. You can reduce your physical technological needs by moving processes to the cloud.

Can my business make money by recycling?

Yes, recycling can be a profitable venture if you take the appropriate steps. If you collect and process recyclable materials like aluminum, paper, and paper with the correct equipment, this can help to reduce costs and add an additional revenue stream for your business.

The right equipment goes a long way towards a business achieving its recycling goals. One such piece of equipment is a baler. You can find the right baler at, while ensures your baled materials are secured with dependable, high-quality baling wire.

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Lessons learned from advising on the world’s largest industrial green hydrogen facility

Global law firm Baker McKenzie recently advised Advanced Clean Energy Storage along with Mitsubishi Power Americas and Magnum Development in the United States Department of Energy’s USD504.4-million loan guaranty to develop the world’s largest industrial green hydrogen facility in central Utah in the United States.

Closed on June 3, 2022, the loan highlights the Biden Administration and the Department of Energy’s (DOE) commitment toward supporting the clean hydrogen sector. It also helps create a viable market for hydrogen and will make it scalable in the western United States and electrical grid, creating the fundamental infrastructure necessary to deploy this zero-carbon energy storage source.

“Supporting ACES Delta to reach financial closing on the DOE loan is part of the unique opportunity to be involved in such a transformational energy transition project in the United States and globally,” said James P. O’Brien, chair of Baker McKenzie’s Global Projects Practice. “To see ACES Delta transform its vision of hydrogen energy storage to the launch of this project is really exciting.”

Christopher Jones, head of Baker McKenzie’s Hydrogen Group, added: “With a growing number of hydrogen projects taking place across the globe, being a part of such a flagship project enhances our legal insights and industry expertise for our team to continue to excel in this space. It demonstrates our continued global leadership in the clean energy technology sector for the past 20 plus years.”

Key issues and lessons learned

Referencing Baker McKenzie’s report – Shaping Tomorrow’s Global Hydrogen Market, James P. O’Brien and Christopher Jones list some of the lessons learned and key issues to consider when considering an investment in hydrogen.

Hydrogen is now playing a crucial role in making an essential and fundamental change to our energy systems. It constitutes a key part of the solution to climate change.

Despite regulatory challenges and legal complexity, there are numerous, important opportunities for businesses.

Closing the gap between cost and revenue in hydrogen projects is possible by making smart use of government support in the form of public funding and public-private partnerships.

Many governments are already supporting the growth of hydrogen using innovation funds, mandatory targets and public-private partnerships, and this support is already showing results. ­

Many countries have adopted (or have committed to do so) hydrogen-specific strategies.

One of the key challenges is decarbonizing hydrogen production. This will entail using (i) renewable (and nuclear) electricity to produce green hydrogen and (ii) natural gas combined with CO₂ storage or conversion into solid carbon to produce blue hydrogen.

Both of these production methods for decarbonized hydrogen are expected to play a major role in meeting the world’s future energy needs. Nonetheless, blue hydrogen could have the advantage in the near term.

Without government intervention through emission trading schemes, energy taxes or similar obligations on grey hydrogen users today, and on those that will use hydrogen when obliged to decarbonize, there will be no significant market for green and blue hydrogen in the short to medium term. 

Since using carbon capture, utilisation and storage (CCUS) is already the cheapest low-carbon hydrogen production method, government support could quickly make this into reality. In this way, the rise in demand for hydrogen could very soon be met using CCUS-based hydrogen production.

Since hydrogen markets will grow exponentially in the mid- and long-term, companies that invest today in hydrogen will be able to capture this growth, become technology leaders and shape the future of the business.

However, there are still multiple barriers to the widespread development of decarbonized hydrogen and each investment will face challenges in the form of policy, regulatory, economic and financial barriers.

The speed of deployment of hydrogen in coming years is expected to vary between sectors and countries. These variations come partly from the different level of maturity or adoption of the technology required for decarbonized hydrogen development, either globally or in specific regions. 

Investors should assess (i) the effect of existing regulatory barriers on any new investment or project, (ii) the likelihood of such barrier disappearing for a particular market and within a particular timeframe, and of course (iii) the availability of public support to de-risk the investment when needed.

To best use available government support, companies should therefore understand (i) which countries provide the most and best focused funding or investment support and (ii) what types of projects governments are likely to support.

Companies contemplating a specific investment in their own region and field of expertise should carry out a thorough analysis of funding and financing opportunities. However, understanding regional and sectoral funding trends as well as expert recommendations can already provide some insight as to government-funding and financing patterns.

Africa developments

Kieran Whyte, Partner and Head of Projects at Baker McKenzie in Johannesburg, and Lamyaa Gadelhak, Partner and Co-Head of the Banking & Projects Practice Group, Helmy, Hamza & Partners, Baker McKenzie Cairo, outline some recent developments in the hydrogen sector in Africa.

In February 2022, the South African Hydrogen Society Roadmap (HSRM) was published by the South African Department of Science and Innovation, marking an important milestone in the launch of South Africa’s hydrogen economy.  The HSRM was developed by the Department of Science and Innovation, Hydrogen South Africa (HySA), and government and industry stakeholders. It focuses on national ambitions, sector prioritization, the overarching policy framework and the macro-economic impact of the hydrogen economy throughout South Africa. 

The Roadmap is aligned with the country’s Integrated Resource Plan, the Integrated Energy Plan and the Renewable Energy Policy, all of which acknowledge the important role of hydrogen in South Africa’s just energy transition, which aims for net zero emissions by 2050.

The HSRM outlines a number of targets, including the creation of an export market for green hydrogen and ammonia, the implementation of a Centre of Excellence in manufacturing for hydrogen products, the development of domestic hydrogen supply chains, the production of 500 kilotons of green hydrogen by 2030, and a long term target of 15 GW power generation based on hydrogen by 2040. Further targets include a one megawatt small-scale electrolysis facility piloted by 2025, and the deployment of 10 GW electrolysers in the Northern Cape and 1.7 GW electrolysers in the Hydrogen Valley by 2030.

The government of Egypt has expressly recognized the production, storage and export of green hydrogen and green ammonia among the areas falling within the state’s economic development strategy.

It has also passed a decree that would allow green hydrogen and green ammonia projects to benefit from a wide range of state support under the country’s existing Investment Law No. 72 of 2017, including tax incentives.

This is a key development for Egypt’s hydrogen economy. We expect that it will stimulate private investment and the development of new green hydrogen and ammonia projects in the country.

In May 2022 Egypt, Kenya, Morocco, Mauritania, Namibia and South Africa launched the Africa Green Hydrogen Alliance, with the intention to foster collaboration and ensure the continent is able to lead in the development of green hydrogen for energy transition.

Empowering African countries to participate fully in the green hydrogen market has tremendous potential to improve access to cost-effective power for all African citizens. African economies will also reap the benefits of the rapidly increasing global demand for sustainable, decarbonised power. However, infrastructure gaps, and policy, regulatory and funding barriers must be urgently addressed through government support and incentives.

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Is Africa being left behind in the push for a net zero world?

The UK shooting past its record high daytime temperature in July was a powerful reminder that the effects of climate change aren’t something that will be felt in the distant future, but which are with us here and now. It also happens that there have been a lot of those powerful reminders in 2022.

By Brondwyn Douglas, Senior ESG Officer at Spear Capital

Whether it’s the wildfires raging across Europe, the floods that ravaged parts of Australia and South Africa earlier this year, or the megadrought that’s enveloped southwestern North America, the signs are now too glaring to ignore. 

Acknowledging the problem and addressing it, however, are two different things. Much has been made of the net-zero commitments made by some of the world’s biggest governments, as well as the fact that the combined assets companies committed to achieving net-zero emissions had risen to US$130 trillion by the end of 2021. 

But in the quest for a net-zero world, is Africa being left behind? Is it getting the support it needs to not only develop sustainably but also live with the effects of the climate catastrophe? 

Addressing significant vulnerabilities 

Africa is, after all, disproportionately affected by climate change, with rising global temperatures already triggering food insecurity, poverty, and displacement across the continent. There will be other impacts too, including the destruction of heritage sites and a rise in conflict.

In many ways, the continent is suffering from the actions of others, particularly in the developed world. Africa itself is only responsible for less than three percent of global CO2 emissions. Despite that and despite the fact that large parts of the continent still have a lot of ground to make up when it comes to growth and development, it is under massive pressure to reduce its own emissions. 

In fact, as an article in Foreign Policy points out, some rich-world nations have gone so far as to leverage development aid and threaten to cut off finance to push African countries into adopting climate change mitigation strategies. At a surface level, it’s possible to see why the rich world is putting this kind of pressure on the continent. Having seen the rapid economic rise of China, India, and other large emerging markets result in matching increases in carbon emissions, it fears that the same will happen in Africa. That too makes a modicum of sense. While population growth in other parts of the world is plateauing or even shrinking, it’s still accelerating across the continent. In fact, 2020 research showed that the world’s 15 fastest growing cities were all in Africa.   

Ignoring Africa’s realities    

The trouble is both of those views ignore a couple of realities. The first is that the continent is starting from such a low energy usage base (with the notable exception of South Africa, which has the world’s most polluting power company in the shape of Eskom) that, even on the continent’s accelerated growth path, its contribution to global emissions is likely to remain lower than that of the developed world for some time to come. 

The second is that Africa has a long history of adopting new innovations without needing all the preceding stages other countries experienced. The story of how the continent “leapfrogged” fixed line telephony with mobile phones is well-trodden, as is its embrace of mobile money. Less well-known is how it’s used those innovations to embrace things like off-grid solar power.

As countries across the developed world try to figure out how to change their power systems from one-way, centralised grids to smart, two-way ones, many parts of Africa have a chance to take such an approach from the beginning. 

Investing on the ground  

Africa, in other words, needs different ways of thinking to guarantee a greener future. To our mind, that looks like investment in the companies that are already making a difference on the ground, fostering development, and advancing sustainability. 

These companies understand the realities of the markets they operate in and are in a much better position to push Africa towards sustainable development and even net-zero than paternalistic handouts and punitive threats.

While limiting the effects of the climate catastrophe is and should be a global effort, it should not be informed by misconceptions that Africa represents some kind of existential climate threat. In fact, with the right investments in the right places, it might just offer models that the rest of the world can follow. 

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Creecy firm in rejecting Karpowership plan

Environment minister Barbara Creecy has stood firm on her legal mandate to defend the country’s environment, declaring that support from Gwede Mantashe’s energy department for Turkish powerships cannot override the Constitution and environmental laws.

By Tony Carnie Follow

Forestry, Fisheries and Environment Minister Barbara Creecy has noted that, “The alleviation of the current energy crisis may be vital, but this does not mean that it must be achieved by this specific (Karpowership) project. Nor does it follow that there is now a licence to ignore all relevant environmental considerations.”

And yet, Creecy has given the controversial Turkish Karpowership group a third bite at a multibillion-rand, 20-year energy contract cherry — by granting the company another chance to “rectify” the manifest failures in its flawed and incomplete environmental impact assessment (EIA) process. 

Significantly, the EIA was preceded by a cynical and possibly fraudulent attempt to circumvent the EIA process entirely by exploiting “emergency approval” loopholes under Section 30A of the National Environment Management Act at the height of the Covid-19 crisis.

In emphatic written decisions dated 1 August, Creecy dismissed all three appeals by the Istanbul-based Karpowership group against the rejection by her department of their EIA proposals.

The company hopes to generate 1 220MW of electricity by docking several gas-burning power and allied supply ships in the Richards Bay, Ngqura and Saldanha harbours.

‘Special weighting’

Creecy said Karpowership’s consultants, economic allies and legal representatives had tried to brush aside significant environmental concerns and persuade her that energy and socioeconomic considerations should be given a special weighting in the EIA approval process — and that there should also have been a special intergovernmental consultation process for this Strategic Integrated Project.

Creecy was not impressed by these arguments, declaring that in terms of Section 24 of the Constitution, she had the imperative to protect the environment for current and future generations and to ensure that all development was ecologically sustainable.

In response to criticism from several business lobbies, including the National African Federated Chamber of Commerce, Black Entrepreneurs Stand Together and the Eastern Cape Maritime Business Chamber, Creecy acknowledged that the government’s 2019 energy path did not exclude gas-fired power plants.

However, she said: “Karpowership is not the only entity that can deliver this result, and refusing their application for authorisation simply means that from the perspective of environmental governance, the proposed activities cannot be supported.

“Therefore, I do not agree with the argument that because this specific application for environmental authorisation was refused, therefore a general national policy was contradicted.”

Her rulings, running to roughly 100 pages each for the three harbour proposals, make it clear that both she and her department remain concerned about several aspects of the Karpowership plan.

These included the climate change impacts of emitting millions of tonnes of greenhouse gases and significant risks to fisheries, birds and marine organisms from underwater noise or hot water expulsions from the powerships’ turbochargers, exhaust stacks and cooling water circuits.

Why the lifeline?

While many will applaud Creecy and her officials for seemingly holding the line against actual or perceived political pressure by those with vested interests in the gas project, questions now arise about why has she thrown another last-minute lifeline to Karpowership to correct its failures and attempted shortcuts.

According to the appeal ruling, Creecy has the legal discretion to fashion a “just and equitable remedy” to address any shortfalls or irregularities in the EIA process.

“In my consideration of all the relevant information before me, I find that there are various gaps in information and procedural defects in relation to the public participation process that led to the rejections of the EA application. The gaps in information and procedural defects are material and fatal and cannot be cured during the current appeal process.”   

In exercising her discretion on the matter, she said various interests that might be affected by her proposed remedy should be weighed.

“This should at least be guided by the objective to address the wrong occasioned by the infringement; deter future violations; make an order which can be complied with; and which is fair to all those who might be affected by the relief.”

Therefore, she had decided to remit the matter to her department so that “various gaps and defects” in the public procedure process could be addressed during the “reconsideration and re-adjudication” of the environmental approval process.

Time limits

The proviso is that this reconsideration process should comply with the time frames stipulated in the 2014 EIA Regulations.

Neither her department nor Karpowership has responded to our questions on the duration of these new time limits. But according to senior Durban environmental attorney Jeremy Ridl, the Turks may now get another 106 days, or 156 days, to submit a revised EIA report, depending on the processes followed. Thereafter, Creecy’s department would have another 107 days to make a final decision.

Ridl said that while these time frames provided for a minimum of 30 days for public participation, the public would be at a considerable disadvantage while preparing or evaluating expert opinions.

The fact that Creecy had granted Karpowership another bite at the EIA cherry suggested to him that she was inclined to grant final authorisation at a later stage if the company could address the identified defects.

It was also possible, however, that Creecy was simply being cautious in following due legal process and giving Karpowership one final opportunity to repair defects.

Yet, because the ANC government and energy minister Mantashe appeared to have “bent over backwards” to support the Karpowership proposal, Ridl questioned whether the voice of a lone environment minister could sway opinions at Cabinet level.

Nevertheless, Creecy’s appeal ruling gave short shrift to Karpowership’s assertions that she could overlook “micro” environmental impacts in degraded “brownfields harbours”.

“The gaps, limitations and inconsistencies provided in the socioeconomic assessment report had the effect of excluding critical environmental concerns from the EIA, that Karpowership attempts to rationalise based on its own notion of development and improvement of the South African economy.”

Breeding and nursery areas

Far from being heavily degraded industrial harbours, Creecy noted that the 57km2 Saldanha Bay/Langebaan Lagoon was the largest body of wave-sheltered water on the South African coast and provided a critical nursery area for both seabirds and fish such as harders, silverside, stumpnose, goby and blacktail.

Algoa Bay and its islands also provided food, shelter and breeding areas for several sea birds — including the largest breeding ground of the endangered African penguin (about 35% of the global and 42% of the South African population) and the world’s largest population of Cape gannets.

Similarly, Richards Bay harbour and its adjoining mud flats and nature reserve provided a critical nursery area for numerous fish species — not just for the benefit of anglers in the harbour, but the KZN region as a whole.

Underwater noise

Whereas Karpowership had proposed that further studies about underwater noise be deferred until after the powerships had been given the go-ahead, Creecy said this would defeat the purpose of an EIA — namely to identify potential negative impacts before they occurred.

This was especially critical for a power technology that had never been used in South Africa, she said, emphasising the need for a more rigorous, detailed and cautious assessment of underwater noise impacts.

According to submissions made to Creecy by several environmental NGOs, the final EIA report did not contain an adequate assessment of underwater noise impacts generated by powerships in the three harbours for up to 24 hours a day for two decades.

Creecy appears to acknowledge these concerns in her ruling, noting that noise impacts had not been assessed adequately. One of the technical studies noted that marine animals could suffer extensive damage to their hearing systems, haemorrhaging, damage to internal organs and disruption to communication and feeding.

These specialist reports indicated that concerns around human-induced noise in the sea were valid. She also concurred with senior officials in her department’s Oceans and Coasts branch, who voiced concern that there was still “considerable uncertainty” around the potential noise impacts from powerships. 

One of the specialist reports also suggested that additional noise “could be disastrous for the ecology” if it exceeded ecological thresholds or could not be mitigated (by silencing equipment and other methods).

Sea heating

Another issue of concern was the additional heat in the sea around powerships due to cooling water emissions that could potentially affect the food chain, from tiny plankton to small fish and much larger marine animals.

She remarked that specialist studies and the final EIA report were “not always entirely convincing” in dismissing concerns around heated seawater discharges, which could result in temperature increases of up to 15°C in the vicinity of the powerships.

In her ruling, Creecy was at pains to emphasise her belief that the fundamental environmental rights in Section 24 of the Constitution were “distinctly anthropocentric in nature”.

“The ultimate aim of these fundamental rights is not the conservation or protection of the environment for the sake of the environment itself, but the aim therof is the responsible utilisation of natural resources for satisfying the needs of humans.

“In this context, I also have the constitutional and legal obligation not to allow a preventable state of affairs in an environment that may potentially or actually harm the health or well-being, in a wide sense, of another person or persons. The ‘need and desirability’ of a proposed project should also be considered in this context.”

Karpowership response

We asked Karpowership whether it was considering taking Creecy’s ruling on judicial review, and if not, what time window was left for the “remittal and reconsideration process” by the Department of Fisheries, Forestry and Environment.

The company did not respond to our questions, but issued this response:

Karpowership operates in 25 countries across the globe. We take great pride in our track record of environmental stewardship, and we have always placed top priority in our ability to comply with international environmental legislation. Our desire to serve as a good corporate citizen to the people of South Africa and comply with South Africa’s environmental laws is a driving force of this project.

“We respect Minister Creecy’s exercise of her powers, but we are very disappointed with the outlook, especially given the time it took to make a decision. While we disagree with the findings on Friday’s report, we agree with the independent arbiter that there are no fatal flaws in the Karpowership SA EIA. 

“We appreciate the DFFE’s remission of our EIA to the competent authority, which allows us the opportunity to address perceived gaps, and we hope that the process will be much timelier than it has been to date. 

“We all have the same mission — to rapidly provide power to the South African people and to implement solutions that ensure environmental protections and ecologically sustainable development. In order meet these goals, we need a collaborative partner in the government who follows timetables laid out in South African law.

“Floating Gas to Power is embraced in Europe, the United States and Asia because the projects take less than one year to build and deliver clean, affordable and reliable power without the destruction of ecosystems on thousands of hectares of land. 

“South Africa needs dispatchable power now and, with the support and collaboration of the government, we are confident that we can address all EIA concerns and deploy projects that will power 800,000 homes and end one full stage of load shedding.

“We remain committed to being part of South Africa’s energy security solution and are ready to deploy our Powerships immediately.” 

Article courtesy of The Daily Maverick

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What a new world order might mean for the global economy

Russia’s invasion of Ukraine has opened fault lines between nations which will affect trade relations and investment for years to come.

Keith Wade – Chief Economist & Strategist at Schroders

The war in Ukraine is already having a significant effect on inflation and activity in the world economy as commodity prices have soared and supply chains have been disrupted. Inflation in the G7 was running at more than 7% in April, its highest for 40 years, and will reach double digits in some countries such as the UK later this year. The conflict also marks a watershed moment as it challenges established assumptions about the balance of geopolitical power in the world economy. This has implications for future alliances, trade and investment.

In our view, the consequences of Russia’s invasion of Ukraine will reverberate for many years and will act as a further disruptive force on the world economy. In this note, we look at how the war could lead to a realignment of global powers, and a more regionalised world economy with implications for global supply chains and inflation.

Beyond Russia’s invasion of Ukraine: a new world order?

We start by looking at how the war may alter geo-politics and then ask how future trade and investment flows will be affected through changes to supply chains.

Although clearly important in energy markets Russia accounts for only a small part (2%) of global trade. It plays a relatively minor role in international investment and global supply chains or value chains (GVCs). At face value the impact of the war and sanctions would not seem to be a threat to overall globalisation.

However, the invasion of Ukraine has demonstrated the power of sanctions. It’s also opened up a divide between those nations who oppose the war and support Ukraine, and others who are with Russia. There is also a large group of countries which are taking a more neutral position and may at some point be pressurised into choosing sides.

In effect, the war has opened up a fault line between nations and will influence behaviour and investment going forward. Companies are now more aware of the political risks and costs associated with trade and foreign direct investment (FDI).

One of the first lessons from the Ukraine conflict has been the power of sanctions to isolate an economy from the global financial system. Russia thought it was well prepared, but found its war chest of $600-billion foreign exchange reserves ineffective. Access to them has been stymied in the face of sanctions such as exclusion from the SWIFT system, which is integral to making international payments.

Alongside the outcry from public opinion, such sanctions have meant Western companies have had to write off significant investment in Russia since the war began. Estimates from the United Nations Conference on Trade and Development suggest that two-thirds of the Russian FDI stock is held by companies domiciled in developed market (DM) countries opposed to the war. The top 10 holdings by multi-national companies amount to $105-billion, much of which has been written off.

Ignoring political risks can be expensive, but identifying them in advance is never straightforward. One approach is to look at how countries vote in international forums. For example, the recent United Nations (UN) vote to expel Russia from the Human Rights Council provides some clues as to where future alignments may lie.

The necessary two-thirds majority to expel Russia was achieved, with strong backing from the West, particularly the 30 NATO countries. However, there were some notable abstentions such as India, Brazil, South Africa, Indonesia, Mexico, Saudi Arabia and other nations from the Middle East. Meanwhile, Russia, China, Cuba, North Korea, Iran, Syria and Vietnam were among the 24 countries who voted against.

China and the risks of broader sanctions

Clearly, China stands out amongst the dissenters. The world’s second largest economy, it accounted for 18% of global merchandise exports [1] in 2021, the highest for a single country according to the World Trade Organization (WTO).  China has also attracted considerable FDI as companies seek direct exposure to the Chinese market. In 2021 it was the second largest recipient and the fourth largest source of FDI.

United by a mistrust of Western institutions and particularly NATO, Russia and China have formed an alliance which has “no limits”, indicating scope for broad-based co-operation. From an economic perspective, the two are complementary as Russia seeks more sophisticated technology and China is very commodity-dependent. It may also be possible to trade the Chinese yuan against the Russian ruble outside of SWIFT and free of Western sanctions.

So far China has been careful in what it says about the Ukraine crisis and at this stage there has been no acceleration in trade with Russia. As the friendship develops, however, there is a risk that support for, or even a lack of opposition to Russia will be interpreted in a hostile way and ultimately attract sanctions from the West.

One potential flash-point is in energy markets, where sales of gas and oil have been critical in funding the Russian military. As a consequence of sanctions there is a significant discount on Russian oil, currently $25/barrel (see chart 1, below) which offers a substantial saving on energy costs and a competitive advantage for those economies who are prepared to buy it.

Some of that discount is eroded by refining and insurance costs, but with the EU and US set to embargo Russian oil, the saving on Urals crude is expected to persist. The discount has certainly already proved sufficiently attractive for India. It has become a significant importer of Russian oil, increasing its share of the country’s exports to 18% from 1% before the conflict in Ukraine. India and China now account for about half of Russia’s marine bound oil exports.

Consequently, we can expect tensions to build and it will not be long before we hear a call for tariffs or other measures on those supporting Russia through trade. Such action could be seen as being in the same vein as the EU plan to impose carbon tariffs on imported goods which are heavily reliant on burning fossil fuels. Russian aggression rather than climate change would be the target, but the measures would be the same.

China’s relations with the West: a balancing act

Before we go too far along this path though, we should remember that China will try to strike a balance. China’s prosperity is based on international trade, mostly with the West. The US-China trade route is still the busiest in the world and increased trade with Russia cannot compensate for the potential loss of US or EU business.

Meanwhile, the West is well aware that the growth in China trade has been one of the major drivers of globalisation. The increased supply of low cost Chinese goods has played a key part in suppressing inflation (see chart 2, below, for the link with US retail sales) and, by raising global labour supply, putting downward pressure on wage costs in the developed markets.

Should the West extend sanctions to those nations seen as supporting Russia and prolonging the conflict in Ukraine, global growth would be weaker as international trade slows. China would be badly affected and would struggle to counter the loss of US and European trade. However, the impact would also be felt in the West through faster global inflation and an even greater cost of living crisis.

Such a stagflationary outcome means that mutual interests in the global trade system are likely to prevail and both sides will tread carefully to avoid an escalation in tensions over Russia.

Another blow to globalisation  

Nonetheless, the conflict in Ukraine clearly sets the stage for an increase in geopolitical tension as a new world order emerges. In this respect the risks have risen and hence deal another blow to the globalised model of extended supply chains. When making decisions over where to locate production, multi-national companies will be weighing the risk of adverse political outcomes against the benefits of more efficient operations.

That model has, of course, already come under strain from Brexit, US trade wars with China and the Covid-19 pandemic. 

The latter exposed the weakness of far-flung supply chains and remains an issue as China’s zero-Covid policy continues to delay deliveries. The trade war between the US and China has also injected a degree of caution. Tariffs and restrictions on technology have increased such that FDI into China has slowed.

For the UK, Brexit has caused major disruption in supply chains as international firms grapple with the complexities of producing goods across different trade jurisdictions.

Meanwhile, climate change acts as a continuing threat in the background with the potential to disrupt supply routes and production facilities.

Not surprisingly, “just in case”, is replacing “just in time” as the guiding principle for firms seeking to make their supply chains more resilient.

Options for future trade

This presents several options. We may see increasing capital flows into other “friendly” lower risk countries as alternative locations for FDI. Companies may hold more inventory, there may be more onshoring of overseas production, or simply less output as the extra risks deter expansion.  

  • Increased FDI to lower risk countries
  • Companies holding more inventory
  • More onshoring of overseas production
  • Less investment, less output

The first of these options would be preferred from an economic perspective as it would sustain global trade, albeit on a more regional basis. Estimates from the McKinsey Global Institute suggest that 15-25% of global goods trade could shift to different countries over the next five years. The result would be that a broader set of countries will participate in GVCs in the years ahead. Our earlier analysis on US-China decoupling also provides some scenarios.

Alongside this we are likely to see a simplification of production processes as has been apparent in the reduction in semi-conductor chips in the auto industry and greater standardisation, such that inputs can be sourced from a wider group of suppliers.

The result may be a departure from the optimal allocation of capital, but efficiency losses would be minimised. In effect, supply chains could become simpler and more diversified, an outcome acceptable to economists and risk managers alike.

Increasing inventory – the second potential option – is probably the most obvious: building buffer stocks into the supply chain. This would be a reversal of the more efficient just in time model which helped drive significant declines in the inventory-sales ratio in the first decade of the century. These declines occurred between China’s ascension to the WTO and the global financial crisis (GFC). 

However judging from recent trends in the US there has already been some increase in inventory-sales ratios in recent years and prior to Covid (see chart 3, below). This may not reflect the broader international picture, but could be attributed to low interest rates after the GFC which reduces the cost of funding inventory.

Going forward, inventory is likely to rise given its low cyclical position and as firms choose to hold greater stocks in the long run to guard against disruption, but higher interest rates may temper this move.

The third option of more on-shoring through bringing supply chains home would boost domestic activity, but clearly represents a retreat from globalisation. The supply chain may become more robust and resilient to global shocks, but security comes at a price. For example, moving production from Asia back to Europe can be expensive. Although the ratio of workers’ wages in the US compared to China has fallen from over 30 in 2000, it was still five times in 2018 (the latest figures available).

The increase in transport costs (shipping and fuel) helps offset this, but higher labour costs mean that increased onshoring will come alongside greater investment in robotics and artificial intelligence (AI). Higher productivity will be needed to stay competitive. One of our longer run themes or Inescapable Truths – accelerated technological change – will be strengthened by the search for more resilient supply chains.

The fourth outcome, less investment, is the worst outcome as it would simply mean less trade, weaker growth and lower income.

In practice we will probably see a mix of all four options: diversification of supply chains to “safer“ countries, more inventory and onshoring and some withdrawal from international trade.

Stagflation as the risk premium on globalisation rises 

What does this mean for investors? The reverberations from Russia’s war with Ukraine point to a new alignment of nations. Tensions over the war are likely to lead to a more fragmented or regionalised world economy.

In macro terms this means less efficiency, higher costs and slower growth i.e. more stagflation. Global supply will be more disrupted and in this respect inflation will be harder to control. The challenge for central banks in keeping inflation to target will be greater, making interest rates higher and more volatile.

There will be bright spots as the search for greater security of supply should encourage greater adoption of technology. Firms will need to counter higher costs through higher productivity. Wages should be stronger as a result, although overall global employment would be lower particularly in the emerging markets.

The war in Ukraine will intensify the focus on the risks of globalisation and raises geopolitics up the agenda for business and investors. Trade and investment help bind countries together, but when they unravel the costs are significant.

[1] China plus HK, China (WTO)

Schroders plc

Issued by Schroder Investment Management Limited. Registration No 1893220 England. Authorised and regulated by the Financial Conduct Authority.  For regular updates by e-mail please register online at for our alerting service.

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