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IMF chief 'couldn't sleep' after reading climate report: 'What have we done?'

Oscar Williams-Grut
Senior City Correspondent, Yahoo Finance UK
IMF Managing Director Kristalina Georgieva speaks at a news conference ahead of the World Economic Forum (WEF) in Davos, Switzerland, 20 January 2020. Photo: Denis Balibouse/Reuters

The head of the International Monetary Fund (IMF) said she couldn’t sleep after reading a landmark report into climate change and its effects last year.

Kristalina Georgieva said during a session at Davos on Thursday: “The big eye opener was when last year I read IPCC report. I tell you, I could not sleep that night.”

The UN’s Intergovernmental Panel on Climate Change (IPCC) in 2018 published a landmark report warning that there are just 12 years left to limit planetary warming to 1.5 degrees this century.

The report, which took two years to compile, warned that warming above this threshold would severely increase the risk of droughts, floods, extreme heat, and poverty.

“All I could think of was my 8-year-old granddaughter,” Georgieva saiad. “What have we done? By the times she’s 20 there could be 100 million more poor people because of climate change. By the time she’s 40 there could be over 100 million climate refugees. If she lives to be 90 and the temperature is 3 to 4 degrees warmer, this planet will be barely liveable.”

READ MORE: Prince Charles says climate change 'greatest threat ever' as he meets Greta Thunberg

Georgieva was speaking at Davos alongside BlackRock (BLK) chairman and chief executive Larry Fink. Fink recently declared that BlackRock, the world’s biggest asset manager, would put sustainable investment and tackling climate change at the heart of its investment strategy.

“The private conversations we’ve had with our clients I would say has been 99 to 1 in favour,” Fink said Thursday.

“Some of the most generous letters I’ve had are from our clients in Texas. Some of the most generous conversations I had were clients from Saudi Arabia and the Emirates.”

The ongoing climate crisis is one of the biggest themes of this year’s Davos conference. WEF said ahead of the gathering that all the biggest current threats to the world are environment-linked and 17-year-old climate campaigner Greta Thunberg has been one of the most high-profile speakers. Thunberg called on governments and investors around the world to immediately abandon all fossil fuels to stop the climate crisis worsening.

READ MORE: 'Our house is still on fire': Greta Thunberg chides leaders for climate inaction

“Climate change can’t be people saying we want to decarbonise everything tomorrow,” Fink said Thursday. “Populist leaders will take advantage of that.”

Fink said governments’s approach to climate change to date has been “very regressive.”

“We talk about Carbon tax,” he said. “Carbon tax is so regressive, it hurts the poor it does not harm the wealthy.

“However, if government’s used their carbon tax and dedicated a high percent of the carbon tax to a redistribution to those who are being hurt but also creating a real outcome to decarbonise, then we have better outcomes.”

READ MORE: BlackRock vows to address climate change: 'Climate risk is investment risk'