The Bhutanese Leading the way.
The final day of the Bhutan Innovation Forum saw a compelling fireside chat with renowned economist and member of House of Lords, Lord Nicholas H. Stern.
Lord Stern, widely known for his pioneering 2006 review on the economics of climate change, began the discussion by defining sustainability in clear terms. “Sustainability is offering the next generation opportunities at least as good as the ones we had,” he said.
He emphasized the importance of balancing four types of capital, physical, human, natural, and social, in shaping a sustainable future. Bhutan, according to Lord Nicholas Stern, stands as a global example in this regard.
Lord Stern praised Bhutan for its exemplary commitment to sustainability, describing it as the world’s first carbon-negative country, a nation whose holistic development model integrates social, cultural, natural, and physical capital.
He said, “Bhutan’s approach is truly inspirational.” Noting how the country’s development philosophy extends beyond traditional economic metrics to embrace social and cultural well-being.
“By putting the social and cultural side first, Bhutan has shaped the way it invests in physical capital, how it educates its children, and how it protects its natural capital,” he said.
He also highlighted that Bhutan has been a leader in sustainable development for nearly four decades, well ahead of many other nations that are only now beginning to grapple with the challenges of climate change.
Lord Nicholas Stern acknowledged that Bhutan’s achievements in education, for instance, have created a dynamic in which young people seek opportunities abroad. “Having done so well in educating its youth, Bhutan now faces the challenge of offering these young people opportunities within the country,” he said.
The conversation turned to the environmental threats posed by climate change, particularly for regions like the Himalayas. Bhutan, located in the heart of this mountain range, plays a crucial role in regulating water flow across vast areas of South Asia. He warned that the melting of glaciers and snow in the Himalayas, driven by rising temperatures, could have catastrophic consequences.
“The snow and ice in the Himalayas act as a sponge that controls water flow. If that sponge disappears, we could face unmanageable torrents during the rainy seasons and dry rivers during others, undermining the livelihoods of millions who depend on these rivers. This risk emphasizes the need for Bhutan to continue its leadership in climate action and adaptation,” he said.
He also pointed out that climate change, through rising temperatures and shifts in water availability, could make large swaths of the world, including parts of India and China, increasingly uninhabitable.
He warned that if global temperatures rise beyond manageable levels, particularly with dangerous wet bulb temperatures, outdoor living will become impossible. For Bhutan and its neighboring countries, the stakes of inaction are immense.
Lord Nicholas Stern acknowledged that current global climate financing falls woefully short, with only USD 150 billion to USD 200 billion available annually when at least USD 1 trillion will be needed by 2030. Despite the challenges, he emphasized that Bhutan, with its rich hydropower resources and sustainable energy policies, is well-positioned to continue leading by example.
He advocated for increased private sector involvement in climate financing, noting that much of the required investment must come from external sources. Bhutan’s growing clean energy sector, particularly hydropower, offers significant opportunities for growth and international collaboration.
He said, “Bhutan, through its example and position in the Himalayas, can have a powerful influence on global climate action.”
Recognizing Bhutan’s leadership in sustainability, he proposed the establishment of a Bhutan Forum for Climate Change and Sustainability as a platform for discussing actionable strategies.
He said that as Bhutan seeks to capitalize on its role as a leader in environmental stewardship, the next decade will be crucial.
He stressed on the importance of immediate action, particularly in emerging markets and developing countries, where much of the future growth and infrastructure development will take place.
“The challenge now is to create the conditions for that investment to take place,” he said, urging stakeholders to act swiftly.
