Countries in Latin America and the Caribbean are emerging as key players on climate change issues. The World Bank is partnering with them through innovative platforms for dialogue and action on the ground, as well as supporting South-South cooperation.
The region's greenhouse gas emissions originate mainly from deforestation and the expansion of agricultural land. Energy generation and transport are other major contributors, and the three sources together represent nearly 65 percent of all such emissions in the region. Transport is the fastest-growing source of emissions across the region.
Climate change will result in major melting of glaciers in the Andean mountain chain, reducing capacity for hydropower generation and disturbing downstream water flow that is needed for agricultural production. Higher ocean temperatures and a sea level rise will result in severe coral reef retreat and salinization of coastal wetlands. More frequent and intense hurricanes will particularly affect the Caribbean and Central America, posing major threats to livelihoods and infrastructure. In the southern part of South America, the land area suitable for agricultural production is actually expected to increase due to higher temperatures and higher precipitation, an effect similar to one predicted for temperate areas in the northern hemisphere.
The region has been addressing the climate change agenda for quite some time. The World Bank is helping countries refine the global climate change models to make them more useful, both at country and local levels. Linked to this are assessments of potential impacts on the overall economy, the health sector, the water cycle, and major ecosystems, especially the possibility of major changes in the Amazon ecosystem. Across the Bank Group, IFC is also integrating its Amazon and climate change strategies and incorporating cleaner production into its investment strategy for industries in the region. The Bank is helping address the consequences of glacier melt on power generation and the agricultural sector, particularly in Bolivia, Ecuador, and Peru. Initiatives are also underway to mitigate greenhouse gas emissions in Mexico City and Bogota.
Drawing on funding and technical assistance from the World Bank, the region has piloted several new technologies and approaches to reduce emissions:
- Mexico’s 2007 National Strategy on Climate Change adopts long-term, nonbinding targets. In the energy sector, it identifies a total mitigation potential of 107 million tons of greenhouse gases by 2014, a 21 percent reduction from business as usual over the next six years.
- Brazil is moving towards energy independence by expanding alternative energy sources such as hydroelectricity, ethanol, and biodiesel. Its sugar-based ethanol production is financially and environmentally sustainable without diverting land from food crops.
- Environmentally friendly public transport policies, first demonstrated by Curitiba, Brazil, and expanded in Bogota, Colombia, are now underway in dozens of cities across the region.
- Costa Rica has received worldwide recognition for its efforts to place a financial value on preserving ecosystems, through several initiatives involving payments for ecosystems services.
- Argentina is moving forward with renewable energy in rural areas. This provides affordable and reliable electricity to communities and has an impact on productivity and jobs
In December 2008, the World Bank Chief Economist’s Office released its report, “Low Carbon, High Growth: Latin American Responses to Climate Change.” The report noted that the Latin America and the Caribbean region can become a “solution-provider” for global warming mitigation and adaptation to climate change impacts. The region should be able to pursue economic growth strategies while adopting a low-carbon development path. Such a strategy will benefit the region’s competitiveness, especially if industrialized countries also move toward low-carbon technologies.