Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.
Speaker 2: This is Bloomberg Business Week Daily reporting from the magazine
Speaker 2: that helps global leaders stay ahead with insight on the people, companies,
Speaker 2: and trends shaping today's complex economy, plus global business, finance
Speaker 2: and tech news as it happens. The Bloomberg Business Weekdaily
Speaker 2: Podcast with Carol Masser and Tim Steneveek on Bloomberg Radio.
Speaker 3: Hi, everyone, Welcome to the Bloomberg Business Week Weekend Podcast.
Speaker 3: Well our backdrop this week gridlock in New York City. Yes,
Speaker 3: that was definitely going on this as the eightieth Annual
Speaker 3: UN General Assembly was in session, coinciding with New York
Speaker 3: City's annual Climate Week summit. President Trump gave his first
Speaker 3: UN speech of his second term as president, a sailing
Speaker 3: the World Body in other countries of offering nothing but
Speaker 3: empty words and labeling climate change a con job. With
Speaker 3: Thatlobal Leaders in Town, Bloomberg and Bloomberg Philanthropy is both
Speaker 3: founded by Michael R. Bloomberg hosted the Bloomberg Philanthropies Global Forum,
Speaker 3: where we did a live broadcast.
Speaker 4: Over the next two hours, we will bring you some
Speaker 4: of our conversations and highlights from the event. These are
Speaker 4: discussions focused on innovation and opportunity in the climate space,
Speaker 4: as well as we're funding for global climate change initiatives
Speaker 4: is coming from and how it all fits into the
Speaker 4: state of the global economy. On that a lineup of
Speaker 4: European leaders from government to banking. We also talk AI
Speaker 4: data centers and the growing partnerships in the space with
Speaker 4: the former head of strategic partnerships at OpenAI.
Speaker 3: And then a little later on Bloomberg News editor in
Speaker 3: chief John mcklethwaite sits down with the Prime Minister of Spain.
Speaker 3: First up this hour, I'll look into the global consumer,
Speaker 3: the US consumer, and what big multinational companies are prioritizing
Speaker 3: in this new age of tariffs. We do that by
Speaker 3: checking in with the world's largest retailer. We are, of
Speaker 3: course talking about Walmart. A member of the company c
Speaker 3: suite joined us at the Bloomberg Philanthropies Global Forum. Chris
Speaker 3: Nicholas is president and CEO of Sam's Club, wal Mart's
Speaker 3: membership only retail warehouse club, mostly with clubs in the US,
Speaker 3: but also overseas in Mexico, China, and Brazil.
Speaker 5: What we're seeing at Sam's Club is consumers that are
Speaker 5: consistent and rational. You know, I've been in retail for
Speaker 5: more than thirty years now, and I've never known a
Speaker 5: time when people don't love great items at great prices.
Speaker 5: And as long as you're giving people that, we're finding
Speaker 5: consumers really you know, rational and consistent.
Speaker 4: What is their behavior though right now? Because that's something
Speaker 4: Carol and I were talking a lot about, you know,
Speaker 4: the whole idea of are they buying what they typically buy,
Speaker 4: are they buying what they buy at a certain point
Speaker 4: in economic cycle, are they trading up, are they trading down?
Speaker 4: What are they doing in your stores?
Speaker 5: Yeah, it's interesting with I mean, consistent would be the
Speaker 5: word i'd use. People are still buying general merchandise from US.
Speaker 5: I mean, we talked in our last quarter at the
Speaker 5: results about general merchandise sales having another quarter of positive
Speaker 5: comp But what's really interesting within that is that the
Speaker 5: units are moving faster than the items, which means that,
Speaker 5: you know, we're still giving them great value. And I
Speaker 5: think people are really moving to appreciate when they're getting
Speaker 5: good value. You know, the club warehouse model is made
Speaker 5: for times like these. I would say it's a good
Speaker 5: time to be in the club model. We've got in
Speaker 5: our clubs. We've only got four thousand items. And the
Speaker 5: way that the club model works, just to level set
Speaker 5: us is our job is to make almost nothing on
Speaker 5: what we sell. We're just about break even and we
Speaker 5: make all our money from membership. So the lower you
Speaker 5: can operate in terms of costs, the lower you can
Speaker 5: keep prices. And when that happens, people are more loyal,
Speaker 5: they renew more often, and you get more members. So
Speaker 5: we're in this like really special moment right now where
Speaker 5: people are love the great value that we've got and
Speaker 5: they love the great items that we've got to you know,
Speaker 5: I want.
Speaker 3: To cross that with what we just heard from Freedsherman J.
Speaker 3: Powe in terms of the decision and kind of basically
Speaker 3: saying the FA's not in a great place, like either way,
Speaker 3: there are some risks to the employment picture, their concerns
Speaker 3: still about inflation. So this is there's kind of risks
Speaker 3: to both sides of the equation and concerned about monetary
Speaker 3: policy that it's hard to do right now in this environment.
Speaker 3: So that to me sounds uncertain, unsure, But it doesn't
Speaker 3: sound like you're saying any of that.
Speaker 5: Look, the club we have this position where there's only,
Speaker 5: I mean between us and our main competitors in the
Speaker 5: club model in particular, we're only like six and a
Speaker 5: half percent of the total retail market, and we would
Speaker 5: definitely from a club point of view, our consumers definitely
Speaker 5: skew sort of more wealthy, you know, bigger basket sizes,
Speaker 5: but we do serve everybody, and we don't see a
Speaker 5: great delta between different income cohorts.
Speaker 3: You don't know, all right, that's more generations. When you
Speaker 3: think about kind of the environment, whichally when it comes
Speaker 3: into tariffs in terms of pricing, how do you kind
Speaker 3: of figure out where you can maybe raise prices where
Speaker 3: you can.
Speaker 5: It's such a great it's such a great question. And
Speaker 5: again not to sort of pivot, but one of the
Speaker 5: powers of the club model is because you've only got
Speaker 5: four thousand items in the club, those items are curated
Speaker 5: and our merchants, they are true professionals that, like many
Speaker 5: of them, have been in their jobs decades and they
Speaker 5: understand the value chain from end to end better than anybody,
Speaker 5: and so they get the ability to choose what's in
Speaker 5: the club, but they also get the ability to work
Speaker 5: through where the inefficiencies are in the supply chain. They've
Speaker 5: got deep relationship with the suppliers, so you work through
Speaker 5: where the opportunities are between the suppliers too. So I'll
Speaker 5: give you an example our roses that we buy from Ecuador.
Speaker 5: The costs went up because you know, the tariff environment changed,
Speaker 5: and so our merchants worked through with the supplier like
Speaker 5: what could we do? So we move them in different
Speaker 5: ways so we have less packaging. We wrap them in
Speaker 5: the US now instead of where we used to wrap them.
Speaker 5: And so you do things like that that help you
Speaker 5: to manage the input costs. That means you don't have
Speaker 5: to pass it on to the consumer. And our job
Speaker 5: is to work through how little you pass through, and
Speaker 5: you work through how late you do it. So we'd
Speaker 5: always like to be last last up.
Speaker 4: But we we have the.
Speaker 5: Ultimate opportunity in the club channel, and that is that
Speaker 5: we have choice because we don't have to sell everything,
Speaker 5: so we the curation actually is a superpower for us.
Speaker 3: Does that mean you haven't raised prices on anything?
Speaker 5: No, No, we see there are certain things that where
Speaker 5: prices move all of the time anyway, So produce would
Speaker 5: be a good example of that, and there.
Speaker 3: Are some terrff for later.
Speaker 5: Yeah, what I would say to you is that if
Speaker 5: I think about general merchandise, would be the which is
Speaker 5: like all of the electronics and apparel and all of
Speaker 5: those things.
Speaker 3: The stuff that I have way too much in my home.
Speaker 5: There's never enough, buy more.
Speaker 3: But in terms of teriffs particularly putting pressure on pricing.
Speaker 5: Yeah, So what we see is in terms of what
Speaker 5: people are buying. I think I mentioned this, but the
Speaker 5: growth in the units that we've had is outpacing our
Speaker 5: comps in general merchandise. So if you think about like
Speaker 5: over the last few years, you had like pack goods
Speaker 5: through COVID became more expensive and they never really came down,
Speaker 5: whereas general merchandise they We had the supply chain disruption,
Speaker 5: you remember that, and the general merchandise inflated and then
Speaker 5: it deflated rapidly as is after all of the supply
Speaker 5: chain disruptions disappeared, and at the end of last quarter
Speaker 5: we were still in a period of slight deflation in
Speaker 5: general merchandise. So prices move all of the time. Our
Speaker 5: job and our merchant's job is to make sure that
Speaker 5: we give people access to the price points they want
Speaker 5: and the value that they want. Maybe it's worth mentioning
Speaker 5: but in Sam's Club, like, we're twenty five percent cheaper
Speaker 5: than retail in general. So as we resist putting prices
Speaker 5: up because that's in our DNA, We're always going to
Speaker 5: be more price competitive than everybody else.
Speaker 3: So then you haven't raised any prices related to terror.
Speaker 6: We will.
Speaker 5: We will be the last people to put prices up.
Speaker 5: And some prices have gone up, but in the mix,
Speaker 5: I'm telling it so for sure. I mean, we we
Speaker 5: have input price changes in some items, and some come
Speaker 5: through already and some is still to come through. But
Speaker 5: I would tell you that our job is not to
Speaker 5: lead with putting prices up, and all of our sales
Speaker 5: growth in Sam's Club is through unit growth, not inflation.
Speaker 4: Okay, cool, I'm wondering what you're hearing from your team
Speaker 4: who's out there talking to the producers, the American producers
Speaker 4: of things we grow, produce beef as well. We had
Speaker 4: a Bloomberg News story last week about farmers and a
Speaker 4: toll that the Trump administration policies are taking on farmers
Speaker 4: right now. Immigration just one of them. Tariffs on soybeans
Speaker 4: are another one. As a result of fewer less interest
Speaker 4: from China and Chinese buyers. What are you hearing though,
Speaker 4: on the immigration front, because in some cases forty percent
Speaker 4: of migrant workers are from outside forty percent of farm
Speaker 4: workers rather are migrant workers, So they're coming from outside
Speaker 4: the US, and that's a challenge for farmers to actually
Speaker 4: find those employees. Right now, what are you hearing from them?
Speaker 5: Yeah, I'm not hearing anything to add or to offer
Speaker 5: on that topic. I would tell you that we have
Speaker 5: brilliant farmer partners. We understand the value change really well,
Speaker 5: and we have no in stock issues or cost price issues.
Speaker 4: So have they raised prices at all on American produce?
Speaker 5: You'd have to ask somebody else about the through line
Speaker 5: on like employment and pricing preases. I think you probably
Speaker 5: speak to lots of people are better informant.
Speaker 4: What about from produce that comes outside of the United States?
Speaker 4: I mean, we can't do everything here. We can't grow bananas,
Speaker 4: we can't grow other avocados. Yeah, the tomatoes when they're
Speaker 4: out of season come from outside of the US. What
Speaker 4: does that look like?
Speaker 5: We definitely over index on US beef. The vast majority
Speaker 5: of what we buy is US, the vast majority, and
Speaker 5: and so you know, but we have choices about where
Speaker 5: we buy from this is the benefit of being this curated,
Speaker 5: limited assortment retailer is that we get the choices to
Speaker 5: buy from the places that where you give the consumers
Speaker 5: great value and great quality, which we're never going to
Speaker 5: relent on. But you know, yeah, we buy items, you know,
Speaker 5: buy avocados as you said, from abroad, and many other items,
Speaker 5: tomatoes when it's out of season, and you know the
Speaker 5: quality and the value. That will never relent on the quality.
Speaker 5: But if the input costs increase, and the input's costs
Speaker 5: will increase. But there's produce. There are so many variables
Speaker 5: produce and beef. I mean that there are so many
Speaker 5: variables that pushes the costs down as well as up.
Speaker 5: So I think it's a super complex situation. And I
Speaker 5: think that our farmers are some of the best in
Speaker 5: the world, and I think that our merchants know how
Speaker 5: to work with the farmers. The thing, the best thing
Speaker 5: you can do for those farmers is to give them
Speaker 5: great forecasts, allow them to grow to those forecasts, and
Speaker 5: give them good prices that allow them to understandable business models.
Speaker 5: And we do a really good job of that.
Speaker 3: Chris, you guys in retail, I'm sure we're you know,
Speaker 3: even late to talk about the holiday season and the
Speaker 3: upcoming holiday season when you think about assortment and what
Speaker 3: you want to have inventory for consumers, how's it looking
Speaker 3: for this year? Is it going to be a lot
Speaker 3: different from last year? Are the supply channel there to
Speaker 3: get what you need and what you want for your consumers?
Speaker 5: Yeah, that's not an issue. We don't see any issues
Speaker 5: with supply chain management in that way. A Sam's Club
Speaker 5: in particular, we get really early. Is you guys, are
Speaker 5: Sam's Club now, which hopefully you know, please do You'll
Speaker 5: see it's full of Christmas.
Speaker 3: I know it tries to be a little crazy. Yeah,
Speaker 3: I mean, if I understand, is it so? I mean
Speaker 3: Halloween hasn't even happened.
Speaker 5: Yeah, Well, in the club channel, people like to be prepared,
Speaker 5: So we get into a season early and then we
Speaker 5: exit early. And that's the kind of scarcity is part
Speaker 5: of the value that we create and so so we're
Speaker 5: not worried about it from a Sam's Club point of view.
Speaker 5: But the thing I would say is that people just
Speaker 5: love to celebrate, they love to buy, they love the seasons,
Speaker 5: and so I think you'll find that certainly at Sam's Club.
Speaker 5: People whether it's the general merchandise they buy pre Thanksgiving
Speaker 5: and Christmas, or the food that they buy for the season.
Speaker 5: A long as you're giving them great value, they're going
Speaker 5: to come to you and people will find a way
Speaker 5: to celebrate.
Speaker 3: One of the things we love about the Global Business
Speaker 3: Form is we tackle everything climate change, you know, workforce, employment, economics, politics.
Speaker 3: As a leader who's been at a company for a
Speaker 3: long time and I'm sure looking at everything that's going on,
Speaker 3: what's top of mind for you and an environment where
Speaker 3: this pushback against certain initiatives, there's a lot of political
Speaker 3: things going on, geopolitics. I'm just curious, you know, in
Speaker 3: running what you guys do, and I know you're kind
Speaker 3: of a well oiled machine in many ways, but I'm
Speaker 3: just curious.
Speaker 5: Yeah, I think, you know, in the in an environment
Speaker 5: of change, and by the way, I like, changes are
Speaker 5: constant and you've got to love it. Then. I've always
Speaker 5: found that the best thing to do is to focus
Speaker 5: on what you can control. And what you can control
Speaker 5: is the culture you create as a business, how you
Speaker 5: work with and treat your customers and your members, the
Speaker 5: experiences that you create.
Speaker 4: You know.
Speaker 5: A great example is the e commerce business We've just
Speaker 5: launched express delivery from our clubs and people love it
Speaker 5: and they're opting in.
Speaker 4: Does the price change with delivery?
Speaker 5: No, we have price parity. We have price so others don't.
Speaker 5: We do, So we have price parity between clubs and
Speaker 5: an online that's really important from a trust point of view.
Speaker 5: And people are thanking us for our delivery from club
Speaker 5: food and non food is growing at triple digits right now.
Speaker 5: So I think, like, focus on what you can control.
Speaker 5: Start with being great people. Start with being a great business.
Speaker 5: Look after your associates so they can look after our members,
Speaker 5: and then you know that that generally will lead to
Speaker 5: the right outcomes.
Speaker 1: So on that.
Speaker 4: We'll hear from one of your big competitors tomorrow. Costco
Speaker 4: reports earnings tomorrow. How do you make sure that people
Speaker 4: join Sam's Club and not Costco?
Speaker 6: Yeah?
Speaker 5: Look, Costco is a great competitor. We think that we're
Speaker 5: great too, and we're doing a lot of good things.
Speaker 5: What I would tell you is this.
Speaker 3: Because you have an aggressive plan in terms of expansion.
Speaker 4: Yeah, I mean about it.
Speaker 5: I know, Yeah, we're really excited about that plan. Actually,
Speaker 5: the club channel in general is a relatively small channel.
Speaker 5: There's a huge there's huge upside for the whole of
Speaker 5: the club channel. And I would tell you this, good
Speaker 5: competition makes you better, and I've never been afraid of
Speaker 5: good competition.
Speaker 3: What about AI and how you guys are working?
Speaker 4: Are you afraid of AI?
Speaker 5: AI?
Speaker 3: We're trying to AI.
Speaker 5: Is a big topic everywhere now, isn't it. We You know,
Speaker 5: here's the thing we are. We're excited about AI as
Speaker 5: a company and I am personally too. I think this
Speaker 5: idea of.
Speaker 3: Are you guys using it a lot?
Speaker 7: A lot.
Speaker 5: We've been using it for a long time, honestly, but
Speaker 5: the generative AI and then the agentic AI that's coming
Speaker 5: through too, is really exciting. It's exciting for our members
Speaker 5: and for our associates. What we do we pivot to growth?
Speaker 5: How does this help us move faster, do more for
Speaker 5: our associates and our members? How do we find different
Speaker 5: routes to market? So that's exciting. Of course, we also
Speaker 5: look at how do you find opportunities to take time
Speaker 5: out of product launches and all of those kind of
Speaker 5: things so that you're a better business. The one thing
Speaker 5: that you may have seen is we also believe that
Speaker 5: the opportunity to give people to empower people with the
Speaker 5: use of AI but with an enterprise, but with enterprise
Speaker 5: data is really exciting. So whether it's in the office
Speaker 5: or recently, we made an announcement a couple of weeks
Speaker 5: ago at our holiday meeting where we gave our frontline
Speaker 5: management access to open ai, to chat GBT and which
Speaker 5: they can use to just go faster and do more.
Speaker 5: And that's really exciting.
Speaker 4: Our Thanks to Chris Nicholas, President and CEO of Sam's Club.
Speaker 3: Coming up, we go all in on AI with the
Speaker 3: former head of Strategic Partnerships and Global Affairs at open Ai.
Speaker 4: You're listening to Bloomberg Business Week. This is Bloomberg.
Speaker 2: You are listening to the Bloomberg Business Week Daily Podcast.
Speaker 2: Catch us live weekday afternoons from two to five pm
Speaker 2: Eastern Listen on Apple CarPlay and Android Auto with the
Speaker 2: Bloomberg Business app, or watch us live on YouTube.
Speaker 3: Leaders and one of the big topics this week that
Speaker 3: we've seen as World Leaders are in town and also
Speaker 3: as it's climate NYC is everything and anything to do
Speaker 3: with artificial intelligence.
Speaker 4: I mean we can kind of stay away from headbines here.
Speaker 4: Every single day Microsoft partner with open AI rival Anthropic
Speaker 4: to help power its workplace. AI Assistant Anthropic founded by
Speaker 4: former open ai employees Carol. It's one of the largest
Speaker 4: competitors to open ai, a key player in the industry.
Speaker 3: Yeah, just coming on the heels of one of the
Speaker 3: big stories that we covered this weekend, VideA announcing it
Speaker 3: we'll invest as much as one hundred billion dollars in
Speaker 3: open ai to help with that build out of data center.
Speaker 3: So there's a lot going on when it comes to AI.
Speaker 3: It's all about partnerships and we have a great guest
Speaker 3: to talk about that. Lane dilg is former head of
Speaker 3: Strategic Partnerships Global Affairs at OpenAI. She's had a career
Speaker 3: in law politics and she's also worked at the Department
Speaker 3: of Justice. I'm rush, but you have like this incredible
Speaker 3: public private background. So when you think about AI, I
Speaker 3: don't know how do you make sense of just it
Speaker 3: just feels phrenetic. The amount of money, the amount of activity,
Speaker 3: the amount of headlines that come every day.
Speaker 8: Yes, there obviously is so much happening, so many big
Speaker 8: deals in the news, and those big deals in the
Speaker 8: news do have real life implications for all of us.
Speaker 8: So incredible, As you mentioned, to see the Nvidia and
Speaker 8: open Ai deal showing that Nvidia will provide chips to
Speaker 8: open ai up to ten gigawatts and also make an
Speaker 8: investment one hundred billion dollars, obviously shoring up open AI's
Speaker 8: credit and providing a real runway for open Ai. Those
Speaker 8: kinds of deals we are seeing almost weekly right now.
Speaker 8: You mentioned Microsoft and Anthropic as well, so very very
Speaker 8: competitive landscape and a landscape that is moving extremely quickly.
Speaker 4: It's kind of funny to hear about Microsoft partnering with Anthropic,
Speaker 4: given that Microsoft is a huge investor in open Ai.
Speaker 4: What do you make of that? Like, what's the world
Speaker 4: that we're living in when you have these bedfellows?
Speaker 3: Yes, I think you know.
Speaker 8: I think everyone is watching sort of all of these
Speaker 8: different pieces. From an adoption perspective, people are looking at
Speaker 8: how how many different companies will individual companies work with?
Speaker 8: So do you want to work with one AI model?
Speaker 8: Do you want to one AI model provider? Do you
Speaker 8: want to work with many? Microsoft also has in house AI,
Speaker 8: they have the partnership with open Ai, and now you
Speaker 8: see them with Anthropic.
Speaker 4: Well can you We've had some folks come on our
Speaker 4: program and say, okay, there's been so much funding, there's
Speaker 4: been so much money chasing these companies. There are also
Speaker 4: those people who say, we're kind of just going to
Speaker 4: wait until the doest settles because we think there could
Speaker 4: be this commodity issue when it comes to lms. What
Speaker 4: separates one LM from another, What separates Claude from chat
Speaker 4: GPT And I fully we're asking somebody who was at
Speaker 4: chad at open AI. So yes, that's where this question
Speaker 4: is coming from.
Speaker 8: A great question though, because obviously now I use all
Speaker 8: of them to try to stay up to date on
Speaker 8: where everyone is, and I also so speak with the
Speaker 8: different companies about sort of what their trajectory will be
Speaker 8: going forward. I do think the models are somewhat different
Speaker 8: just for users. They provide responses a little bit differently,
Speaker 8: they're friendly in different ways, they're useful in different ways,
Speaker 8: and so there's some personal preference. I do think that
Speaker 8: we will start to see differentiation in areas like material science, chemistry,
Speaker 8: biology as people really move into these more specific domains
Speaker 8: where different model providers lean in. Who they work with
Speaker 8: and how will become important in terms of what you
Speaker 8: can do to solve problems with the technology. So and
Speaker 8: I think the other piece, as you see with the
Speaker 8: Nvidio opening ideal. We often say infrastructure is destiny. It
Speaker 8: is true that there is also this massive race for compute,
Speaker 8: and that is because to continue the research and development,
Speaker 8: to continue to make the progress, you need compute and
Speaker 8: compute requires a lot of energy. So we don't know
Speaker 8: yet whether there will be a differentiation there or not,
Speaker 8: but everyone racing to make sure they have the compute
Speaker 8: they need to continue development.
Speaker 3: You run your own advisory firm and you're you know,
Speaker 3: dealing with kind of innovation and partnerships right and working
Speaker 3: with other companies. But I want to go back to
Speaker 3: what Tim said. I mean, I think there was when
Speaker 3: the Nvidia deal came out that there was concerns that
Speaker 3: it was a sign of a bubble. That it's Nvidia
Speaker 3: partnering with open Ai. Obviously it's the company chat gipt
Speaker 3: so identified when it comes to AI at this point,
Speaker 3: but this idea that Nvidia needs a marketplace to keep
Speaker 3: buying its chips. So I'm just curious. I mean, at
Speaker 3: some point, I don't know what are you hearing from
Speaker 3: companies as you talk to them. Are they a little
Speaker 3: cautious at all? Is there any nervousness about this incredible
Speaker 3: spend and this incredible buildout.
Speaker 8: Yes, a great question. Obviously, financial experts around the world
Speaker 8: asking many of these questions. I think, you know, we
Speaker 8: previously thought that Nvidia may not be able to supply enough.
Speaker 8: So interesting to now hear people say, well, they are,
Speaker 8: you know, trying to find a consumer the gipsy. Yes, right,
Speaker 8: so I think you know, I think that conversation happening
Speaker 8: on both sides. You know, my own personal view is
Speaker 8: that we are not yet anywhere close to maxing out
Speaker 8: the demand for compute and chips, and when we are,
Speaker 8: then you may actually see that model development as stalling
Speaker 8: or something else. But I just don't think we're there
Speaker 8: right now.
Speaker 3: I am curious when you are at open AI and
Speaker 3: we know you left a couple a few months ago,
Speaker 3: but now you have your own advisory firm. Is the
Speaker 3: phone ringing off the hook of people saying, help me,
Speaker 3: I need to find this and what are they looking for?
Speaker 8: Yes, so it is true that people are looking for
Speaker 8: lots of answers. They're looking for answers to the macroeconomic questions.
Speaker 8: They're looking for answers to help them guide investments. But
Speaker 8: then teachers and healthcare providers are looking at you know,
Speaker 8: what is the potential How do I take care of
Speaker 8: my workforce and also take care of those I serve
Speaker 8: at the same time, what is the pace of adoption.
Speaker 8: I'm excited to be here with Bloomberg Philanthropies working on
Speaker 8: the Mayorage Challenge, which is a competition they run around
Speaker 8: the world for mayoral innovation for city services, and so
Speaker 8: many people in that space saying where are the opportunities
Speaker 8: for innovation, and we're seeing such interesting proposals there as well.
Speaker 3: I just want to say I actually had a meeting
Speaker 3: with a giant company I'm not going to say who
Speaker 3: it was.
Speaker 4: And we've heard of them.
Speaker 3: Yeah, everybody's heard of them. But it was like we
Speaker 3: were talking about they were asking me about how I'm
Speaker 3: using AI I was asking them, and it's like we're
Speaker 3: all kind of fumbling our way through and we have
Speaker 3: courses that have come up at Bloomberg to kind of
Speaker 3: help us figure our way through. This company they're just
Speaker 3: kind of like somebody figure something out and they do
Speaker 3: it kind of a show and tell, but it's it's
Speaker 3: interesting how we're trying to find our way through this.
Speaker 8: Yes, I've heard two CEOs at the Frontier Labs really
Speaker 8: really say the pace of scientific progress on the AI
Speaker 8: side is much faster than the pace of implementation and adoption.
Speaker 3: It's hard.
Speaker 8: These are large institutions with lots of people. You have
Speaker 8: to actually figure out what is the right way for
Speaker 8: your company, for your school, for your business, and that
Speaker 8: takes some time.
Speaker 4: Chat GPT all the time. Personally. I use it at
Speaker 4: work too. We have the paid version at work, but
Speaker 4: I have the free version on my phone, and when
Speaker 4: it tells me I can't use it anymore, I just
Speaker 4: go over and use claude. How do you prevent that?
Speaker 6: Like?
Speaker 4: How do you get me to pay for it? Like?
Speaker 4: How do you monetize all the free users when so
Speaker 4: much compute is being used?
Speaker 9: Yeah?
Speaker 8: I think you know same with any product in a
Speaker 8: certain way. You want yours to be the go to.
Speaker 8: You want yours to be the most useful, the one
Speaker 8: that you turn to to solve the problems that are
Speaker 8: most important to you. And I think that companies are
Speaker 8: competing in that, and we'll see fits and starts, But
Speaker 8: you do you get accustomed to one product or another.
Speaker 3: So will we be paying for it?
Speaker 4: Well? I mean or is there going to be advertising?
Speaker 8: Yeah, so I think you know right now you can
Speaker 8: pay for different different levels of access. I think that
Speaker 8: is meaningful both for individuals and for businesses. I use
Speaker 8: the paid accounts across all of the different companies, which
Speaker 8: may seem crazy, but I want to see where the
Speaker 8: capability really is. So I do think that is the
Speaker 8: monetization that you're seeing primarily.
Speaker 4: And I'm not at taxed for, but that's a business expense,
Speaker 4: I would imagine.
Speaker 3: So yes, I do think though about the intersection of
Speaker 3: technology and politics, and I feel like every decision is
Speaker 3: made with a careful glance at the White House. So
Speaker 3: talk to me about that and how that might I
Speaker 3: don't know kind of impact the deals that are done
Speaker 3: and how they're done.
Speaker 8: Yes, absolutely, I think you see a lot of that
Speaker 8: in the infrastructure space. So if you if you look
Speaker 8: at the models, they, as we talked about, require compute,
Speaker 8: but compute also requires energy, and as we look at
Speaker 8: competition between the United States and China, I think people
Speaker 8: feel really good about our talent, they feel really good
Speaker 8: about our workforce, they feel really good about our innovation,
Speaker 8: but we do need to get more energy on the grid.
Speaker 8: And we need to do that fast. And so I
Speaker 8: think you see this all of the above approach, but
Speaker 8: also disagreement over what is that all of the above approach,
Speaker 8: How does it work? Do things need to be grid
Speaker 8: connected or not? And most importantly, how do I make
Speaker 8: sure that consumers have the electricity they need at the
Speaker 8: prices they need while we power all this AI?
Speaker 3: Well, is it ultimately going to be everybody, especially the
Speaker 3: hyper scalers probably doing their own energy development on site,
Speaker 3: that kind of thing.
Speaker 8: Or I think you'll see a mix, just like you
Speaker 8: see the A mix and the financial deals. I think
Speaker 8: you'll see a mix both to hedge risk, but also
Speaker 8: because it'll be opportunistic. We need the energy as fast
Speaker 8: as we can get.
Speaker 4: Hey, just want to end with what this does to
Speaker 4: the American workforce, the global workforce. Dario Amida over at
Speaker 4: Anthropic has been really outspoken about how this could just
Speaker 4: decimate white collar jobs. You agree.
Speaker 8: So, I think there was a conference in San Francisco
Speaker 8: that people are watching just last week about what the
Speaker 8: different scenarios are. I think we don't know the answers yet,
Speaker 8: and so from a policy perspective, we need to be
Speaker 8: planning for multiple scenarios. It's critically important that we understand
Speaker 8: both the data of how are jobs moving, where the
Speaker 8: transition's happening, and also look at the social safety nets
Speaker 8: and other things to make sure that if there is dislocation,
Speaker 8: we're doing the reskilling, We're doing the training to get
Speaker 8: people into a place that is product.
Speaker 4: You've seen the tech up close, you know what it
Speaker 4: can do. What keeps you up at night.
Speaker 8: What keeps me up at night is, as always, it's
Speaker 8: the humans. It's our human potential, it's our ability to
Speaker 8: step into this technology, and it's also what we can
Speaker 8: do with it for good or for ill. And I
Speaker 8: think that that's the space where I'd like to see
Speaker 8: the policy focused.
Speaker 3: Are you worried about the bad side of AI?
Speaker 8: I'm worried about humans using AI for bad purposes, is
Speaker 8: what I worry about more than the doomers, who are
Speaker 8: more concerned about what we would call alignment issues. I
Speaker 8: think the science on alignment is pretty strong and will
Speaker 8: continue to be strong, and people will be alarmed if
Speaker 8: it's not. But the question of what can you do
Speaker 8: with the technology is a hard one. We are about
Speaker 8: to all get more powerful.
Speaker 4: That was Lane dilg former head of Strategic Partnerships Global
Speaker 4: Affairs at OpenAI. Again. We were broadcasting live this past
Speaker 4: week from the Bloomberg Philanthropies Global Forum at the Plaza Hotel.
Speaker 4: The event took place alongside the United Nations General Assembly
Speaker 4: in New York, and it brought together heads of state,
Speaker 4: business leaders and more to address the world's most urgent
Speaker 4: challenges and opportunities. There were a lot of leaders there,
Speaker 4: weird from Bill Gates, Ruth Pratt of Alphabet, Jane Goodall
Speaker 4: was there, NBA Commissioner Adam Silver, Brookfields, Bruce Flatt, and
Speaker 4: many more. Check out all of the interviews from the
Speaker 4: Bloomberg Philanthropies at Global Forum on the Bloomberg Terminal or
Speaker 4: at Bloomberg dot com.
Speaker 3: Still ahead on Bloomberg BusinessWeek. The European buildout that investors
Speaker 3: are eyeing when it comes to sustainable economic development and
Speaker 3: how to.
Speaker 4: Get those countries to come together to make it all happen.
Speaker 4: We do that with the lending arm of the European
Speaker 4: Union as well as the European Commissioner for International Partnerships.
Speaker 4: This is Bloomberg.
Speaker 2: This is the Bloomberg Business Week Daily Podcast. Listen live
Speaker 2: each weekday starting at two pm Eastern on Applecarplay and
Speaker 2: Android Auto with the Bloomberg Business app. You can also
Speaker 2: listen live on Amazon Alexa from our flagship New York station,
Speaker 2: Just Say Alexa played Bloomberg eleven thirty.
Speaker 3: This past week, Bloomberg Philanthropy's Global Form took place alongside
Speaker 3: the UN General Assembly in New York and alongside Climate
Speaker 3: Week NYC Now. The event brings together heads of state
Speaker 3: and business leaders to address the world's most urgent challenges
Speaker 3: and opportunities.
Speaker 4: Among those challenges and opportunities is global sustainable economic development.
Speaker 4: And that's where Joseph Sekela comes in. He's European Commissioner
Speaker 4: for International Partnerships. It's kind of exactly what it sounds like.
Speaker 4: He's charged with working with countries all over the world
Speaker 4: to partner on everything from infrastructure, finance, decarbonization, sustainable development
Speaker 4: and more. Welcome, thanks for joining us today.
Speaker 9: Thank you very much for the invitation.
Speaker 4: So you're remed is big, it's global. How do you
Speaker 4: see this in the context of America first and the
Speaker 4: world in some cases turning more inward.
Speaker 9: Well, my experience is slightly different. I don't believe in
Speaker 9: zero some games. I'm a former banker, and my experience
Speaker 9: is that all the business which is not to a
Speaker 9: benefit of all involved parties does not have a usually
Speaker 9: long life. And basically I think Europe is the best
Speaker 9: proof because being built from scratch after the Second World War,
Speaker 9: the cooperation the solidarity was basically one of the foundations
Speaker 9: of the success on the way to lifestyle superpower in average,
Speaker 9: high salaries, highest living standards. This is not a coincident
Speaker 9: that from thirty most developed countries based on the Human
Speaker 9: Development Index, twenty are European ones. And this is basically
Speaker 9: also the narrative. We want to promote partnership of equals,
Speaker 9: mutual benefit, strategic alliances which should help to create jobs,
Speaker 9: to create supply chains, to open the access to the
Speaker 9: world markets to less developed countries, because this is about
Speaker 9: the varue creation, but this is also about the fair
Speaker 9: access to critical raw materials, to more global security, to
Speaker 9: resilience Commission Sequila.
Speaker 3: I am curious who's it easier to partner with China
Speaker 3: today or the United States?
Speaker 9: Well, I don't see, for example, Russia as a like
Speaker 9: economic competitor arrival because what they can offer is just bribes, weapons,
Speaker 9: propaganda and lives in that they are good. China is
Speaker 9: basically plundering the partner countries. They are not investing in
Speaker 9: the future of the countries. They are interested to control
Speaker 9: the supply chain of the row materials and to weaponize it.
Speaker 10: Uh.
Speaker 9: And this is not the way we want to go.
Speaker 9: And I had a very productive meetings here with you
Speaker 9: as representatives and also with the senior advisor, with the
Speaker 9: advisor uh uh uh to President Trump on Africa. And
Speaker 9: this is not about us against Europe. This is about
Speaker 9: collaboration of guardians of democracy in order to ensure fair
Speaker 9: supply chains and uh and and about basically access to
Speaker 9: the chrotico romatillos in order to not allowed the authoritarian
Speaker 9: regimes to to weaponize it.
Speaker 4: Your view on China really got my attention how you
Speaker 4: described it. Do do do countries that China has partnered
Speaker 4: with in the past, and I'm thinking of the historic
Speaker 4: Belton Road initiative from the last decade and a half
Speaker 4: or so, do they share your view that they do
Speaker 4: they feel like China plundered them.
Speaker 9: Subsequently, I think the attention to the difference between promises
Speaker 9: and deliver is increasing in the countries. And since I
Speaker 9: took over the responsibility for global gateaway the European Investment
Speaker 9: Sustainable Investment initiative. I'm traveling, I am traveling a lot
Speaker 9: and to New York. I arrived from Pacific and from Africa,
Speaker 9: from Namibia. And yeah, sometimes I'm calling it belt and
Speaker 9: ring trap because our attitude is to empower, not to impose,
Speaker 9: not to entrap. And there are simply examples, and Namibia
Speaker 9: is the best example. Where Europe is investing in education,
Speaker 9: in supply chains, in the economy of the future, in
Speaker 9: hydrogen production, in de carbonized direct reduced iron which can
Speaker 9: be then used for a clean for production of a
Speaker 9: high quality. Still for example, in Europe, when you take
Speaker 9: into account the structure of the trade between Europe and
Speaker 9: Namibia is very much diverse, and that there is a
Speaker 9: balance positive in favor of Namibia. What is China doing.
Speaker 9: China is investings the road to the mines and buying
Speaker 9: purely unprocessed raw materials and shipping them and sending them
Speaker 9: to China. Meanwhile, it's China controlling seventy percent of the
Speaker 9: raw materials. And we have in Europe very negative experience
Speaker 9: with dependencies and the bill for basically get rid of
Speaker 9: the dependence on Russian fossil fuels was extremely high and
Speaker 9: extremely painful, but we learned what does it mean if
Speaker 9: your arrival is weaponizing the supplies of the fossil fuels
Speaker 9: or critical raw materials against you.
Speaker 4: Our thanks to Joseph Sequila, European Commissioner for International Partnerships.
Speaker 3: Now along with the UN General Assembly this past week,
Speaker 3: as we said, it was also Climate Week NYC and
Speaker 3: Mother Earth was a big topic for President Trump during
Speaker 3: his UN speech, calling climate change quote the greatest con
Speaker 3: job ever perpetrated on the world, while also criticizing renewable
Speaker 3: energy and praising coal.
Speaker 4: The President also warning you and member countries saying quote,
Speaker 4: if you don't get away from this green scam, your
Speaker 4: country is going to fail. That could spell a major
Speaker 4: blow to global climate change initiatives. Our next guest is
Speaker 4: still hoping to deliver over one trillion euros in green
Speaker 4: investment by twenty thirty. In his role, Ama was FIO
Speaker 4: is Vice President of the European Investment Bank. It's the
Speaker 4: lending arm of the European Union.
Speaker 10: One of the big products of your opinion is climate
Speaker 10: neutrality by twenty fifty, right, and we have put in
Speaker 10: plaze to support the subjective a policy that is our
Speaker 10: climate strategy that has targets including having more than fifty
Speaker 10: percent of what we do in climate and environment. This
Speaker 10: is a target that we have reached. We are very
Speaker 10: closer to sixty percent. We are landing around one hundred
Speaker 10: billion euros per year. So it's a big thing for
Speaker 10: us in terms of financing for renewable energy projects, energy efficiency,
Speaker 10: clean transportation, innovation in climate. And our goal is to
Speaker 10: continue and stay of course, because we think this is
Speaker 10: also something that is good for maintaining competitiveness in Europe.
Speaker 10: And we are going to present to our board our
Speaker 10: climate strategy for the next five years that will basically
Speaker 10: continue the pace that we have chosen since five years
Speaker 10: and link that to the competitiveness of your opinion.
Speaker 3: So, even with a narrative in some parts of the
Speaker 3: world that are maybe pushing back against climate change and
Speaker 3: green initiatives, sustainable initiatives, that nothing's changed for you guys.
Speaker 10: No, for us, nothing changes in terms of the past
Speaker 10: and the objective. What we trial to do is to
Speaker 10: listen to what our stakehold does tell us, right and
Speaker 10: for example, some of the SMEs tell us that the
Speaker 10: reporting obligations are very, very complicated. So these kind of
Speaker 10: things that we are going to try also to address
Speaker 10: in our strategy, but the key objectives we are going
Speaker 10: to keep them.
Speaker 4: Can you expand on the idea of competitive advantage a
Speaker 4: little more because here in the United States, as the
Speaker 4: president he said, if you don't get away from this
Speaker 4: green scam, your country is going to fail. He essentially
Speaker 4: thinks that it's a waste of money to actually invest
Speaker 4: in green initiatives or do you sustainable development. That's my takeaway.
Speaker 4: What's the competitive advantage that you believe the European Union
Speaker 4: Union has if it invests in this way?
Speaker 10: I would say there are two things. And when you
Speaker 10: look at energy, we have invested thirty one billion euros
Speaker 10: in twenty five for energy projects. So the one billionaires
Speaker 10: is a lot of money in offshore wind farms, in grids,
Speaker 10: in a lot of also solar and nuclear are then
Speaker 10: the number of projects that are related to energy. The
Speaker 10: things that we see is one that actually the competitiveness
Speaker 10: of the cost of energy is going down for many
Speaker 10: of these renewable energy and it's becoming competitive. And the
Speaker 10: second thing is when you look at energy, you also
Speaker 10: need to look at your independence and what we have
Speaker 10: learned since twenty two and that's why we're sped up. Actually,
Speaker 10: the implementation of our energy projects is that if you
Speaker 10: want to be independent from Russia, you need to have
Speaker 10: more and more energy independence. Energy dependence for a continent
Speaker 10: that has little energy itself means renewable energy and other
Speaker 10: kind of energies.
Speaker 3: How are you thinking about and another war of course
Speaker 3: between Russia and Ukraine is not over still, but thinking
Speaker 3: about what might need to be done in terms of
Speaker 3: helping Ukraine going forward, the financing demands and needs that
Speaker 3: will be to build back or that's been destroyed.
Speaker 10: Yeah, well, actually it is absolutely clear that the needs
Speaker 10: are euroge in Ukraine. And from the beginning of the war,
Speaker 10: we have been supporting Ukraine. Actually, even the week after
Speaker 10: the war we have you know, read on some of
Speaker 10: our loans to be able to send some financing to
Speaker 10: to the Ukraine governments. Since the beginning of the war,
Speaker 10: we have financed four billion years of projects in Ukraine
Speaker 10: and that is mostly in projects that have you know,
Speaker 10: reconstruction of hospital, working with municipalities, train abilities and actually
Speaker 10: we have just opened a new a new line in
Speaker 10: Ukraine that where the you know, the tracks of the
Speaker 10: of the trains will be the same as in Europe.
Speaker 10: It wasn't the case before you had between the Ukraine
Speaker 10: and Slovakia. In this case you had to change trains
Speaker 10: at the border.
Speaker 4: Now you don't know.
Speaker 3: As you rebuild, you do it, yeah, exactly.
Speaker 10: And this is also on the way for accession of
Speaker 10: Ukraine to the European Union. And we have done something
Speaker 10: that that is not necessarily consistent with our climate strategy,
Speaker 10: but that we have done for Ukraine.
Speaker 4: We have just approved.
Speaker 10: Alone that is going to to low Ukraine to to
Speaker 10: finance it storage for the winter, because you know that's
Speaker 10: that's an emergency.
Speaker 4: You're here meeting with leaders from all over the world.
Speaker 4: If there's a message that you have for American leaders
Speaker 4: and what you want from American leaders right now, what
Speaker 4: is it?
Speaker 10: The thing that I like here is to be able
Speaker 10: to meet with a lot of people from very various
Speaker 10: backgrounds and now, and that's what makes these meetings so interesting.
Speaker 10: I mean, the trans atlantic relationship is so important that
Speaker 10: we need to do everything to make us as a
Speaker 10: good partners as possibley.
Speaker 4: That was Amboise Fio, Vice President of the European Investment Bank.
Speaker 3: And that wraps up our first hour of the weekend
Speaker 3: edition of Bloomberg Business Week from Bloomberg Radio. Coming up
Speaker 3: in the next sixty minutes, more voices among the European leadership,
Speaker 3: including the Prime Minister of Spain, and conversation with Bloomberg
Speaker 3: News Editor in chief John Micklethwaite.
Speaker 4: Plus a former Climate High Level Champion on how COPP
Speaker 4: will work in the face of American climate hostility.
Speaker 3: As our coverage of the Bloomberg Philanthropy's Global Form continues,
Speaker 3: this is Bloomberg Business Week. I'm Carol Masser and.
Speaker 4: I'm Tim Staneveek. Stay with us. More from Bloomberg Business
Speaker 4: Week Daily coming up after this.
Speaker 2: You are listening to the Bloomberg Business Weekdaily Podcast. Catch
Speaker 2: us live weekday afternoons from two to five pm. Listen
Speaker 2: on Applecarplay and Android Auto with the Bloomberg Business app,
Speaker 2: or watch us live on YouTube plenty.
Speaker 3: Ahead on our second hour of the weekend edition of
Speaker 3: Bloomberg Business Week, we are highlighting conversations from this past
Speaker 3: week at the Bloomberg Philanthropy's Global Form held in New
Speaker 3: York City. Those conversations include a former UN Climate High
Speaker 3: Level champion on mobilizing stronger and more ambitious climate actions
Speaker 3: amid a US pullback.
Speaker 4: Plus how Canada is tackling the challenges and opportunities in
Speaker 4: sustainable economic development.
Speaker 3: First up this hour. As you know, more than one
Speaker 3: hundred and forty world leaders and senior officials and delegations
Speaker 3: were in town this past week for the United Nations
Speaker 3: General Assembly.
Speaker 4: Among them was Pedro Sanchez, the Prime Minister of Spain.
Speaker 4: He sat down for a conversation with Bloomberg News editor
Speaker 4: in chief John Micklethwaite, and their conversation touched on everything
Speaker 4: from Donald Trump, Spain's housing crisis, and yes, his re
Speaker 4: election efforts.
Speaker 11: Prime Minister Spain, thank you for talking to Bloomberg. It's
Speaker 11: a pleasure to have. It's a pleasure I just looked.
Speaker 11: Out of all Europe's leaders, you are the one who
Speaker 11: seems most prepared to disagree with President Trump. You champion
Speaker 11: the cause of recognizing Palestine, You pushed against the five
Speaker 11: percent limit on defense spending, also been very close to China.
Speaker 11: I mean, when you heard his speech yesterday, did you
Speaker 11: which seemed to depict Europe as a kind of hellhole?
Speaker 11: Did you think that was Do you think that was
Speaker 11: aimed at you.
Speaker 12: Well, I think I'm respectfully disagree with President trump statement
Speaker 12: because you know, he took migration and climate change, as
Speaker 12: I would say, the major challenges.
Speaker 6: That we have to fight against for and I.
Speaker 12: Said, well, look, if you took, the experience of Spain
Speaker 12: is the contrary. So thanks to claim to these green policies,
Speaker 12: we have dropped the electricity prices since twenty seventeen till
Speaker 12: now by fifty percent, so that enables us to gain competitiveness,
Speaker 12: and thanks to that we are witnessing this extraordinary outcome
Speaker 12: of the economic growth in Spain. We represent thirty percent
Speaker 12: of the total economic growth of the European Union. And
Speaker 12: when it comes to migration, in the last seven years
Speaker 12: we have received two million migration migrants, while at the
Speaker 12: same time we have dropped by forty percent the unemployment rate.
Speaker 6: So only all.
Speaker 12: What I'm trying to say is that green transition and
Speaker 12: migration when it comes on regular basis, are positive for
Speaker 12: the economic development of a country.
Speaker 11: Do you think your fellow leaders in Europe could be
Speaker 11: braver about making those comments.
Speaker 6: I think I think that we.
Speaker 12: Need to keep Transatlantic bond and to strengthen that transonenting bond.
Speaker 12: It is in the true that we need to combine
Speaker 12: it with other policies such as, for instance, trade diversification.
Speaker 12: That is why we are we've been very vocal in
Speaker 12: reaching this agreement between the European Union and AMERICASUR, which
Speaker 12: it would be definitely a game changer in.
Speaker 6: Our economic ties with other regions of the world.
Speaker 12: And second, what we do, what we need to do
Speaker 12: within the European Union is to do our homework, as
Speaker 12: the former central banker Madadraghi always remind us, and that
Speaker 12: means that we need to deep in single market, that
Speaker 12: we need to review our competition policy in order to
Speaker 12: scale up a big companies in Europe and try to
Speaker 12: be you know, as good as competitive as a global
Speaker 12: corporation are in the US and other parts of the world.
Speaker 11: It's very interesting though. You look at what's happened. Your
Speaker 11: economy has grown very well two point seven percent. You
Speaker 11: look at what's happening in other countries on the periphery,
Speaker 11: like Greece, there is a very interesting thing. A few
Speaker 11: years ago we were used to saying the referee is
Speaker 11: the problem. The core is great. Now it's the other
Speaker 11: way around. France, Germany, Britain barely growing at all. Do
Speaker 11: you think it is now the center of Europe that
Speaker 11: is the problem in the economy.
Speaker 6: No, not at all.
Speaker 12: I mean Germany is a big country, big economy, also France,
Speaker 12: and we always expect a positive, let's say, dynamic in
Speaker 12: their economies. But it isn't it true that from the
Speaker 12: south we can contribute to the economic growth of the
Speaker 12: European Union. So for instance, when you see that sixty
Speaker 12: percent of the electricity generation in Spain comes from renewable sources,
Speaker 12: that means that we have a potentiality that we can
Speaker 12: contribute to the autonomous strategic autonomy.
Speaker 11: Is exposing that, don't you to France?
Speaker 12: Yeah, well, okay, we need to interconnect better our greeds,
Speaker 12: but we are we're trying to convince our friends in
Speaker 12: France to do so. So only know what I'm trying
Speaker 12: to say is that if you see the economic figures
Speaker 12: of the self in Europe, especially Spain, that represent an
Speaker 12: as said before, thirty percent of the total economic outcome
Speaker 12: of economic outcome of the European Union, that means that
Speaker 12: we have achieved many reforms that were demanded by the
Speaker 12: European Commission over the last years so we have achieved
Speaker 12: to reform our labor market, our patient system, our educational system,
Speaker 12: and also our energy policy and digitalization, along with the
Speaker 12: contribution of migration. So it is true that these pillars
Speaker 12: also show that the economic background or pillars of Spain
Speaker 12: are quite solid if you compared to previous periods such
Speaker 12: as the one before the financial crisis.
Speaker 11: And also your selfish question from the point of view
Speaker 11: all the foreign investors looking at this, many people want
Speaker 11: to invest in space for all the reasons you said,
Speaker 11: But you want to introduce one hundred percent tax on
Speaker 11: them if they want to buy a house there a
Speaker 11: second time?
Speaker 6: Not at all, not at all.
Speaker 12: What we what we need to face is a real
Speaker 12: challenge that I think that across Europe and also in
Speaker 12: in England, in the UK you're suffering, especially the youth,
Speaker 12: but not on the youth, which is the lack of
Speaker 12: or the impossibility to access to a house or to
Speaker 12: emancipate in the case of our youth. What we did
Speaker 12: is for all British people or European people that want
Speaker 12: to buy a house for living, they won't pay taxes.
Speaker 6: The fact. Yeah, but this is the point.
Speaker 12: We we need also to understand that we need to
Speaker 12: solve a problem of housing that we have in Spain.
Speaker 12: But all you know, if you see now the figures
Speaker 12: of a real estate sector, and this is how we
Speaker 12: are speaking. The process of construction in Spain is quite amazing. Nowadays.
Speaker 12: We have increased by sixty three percent construction of how
Speaker 12: let's say, public housing, whilst the private sector has increased
Speaker 12: like thirteen percent during the last year.
Speaker 11: I'll a bit about the relationship to the economy and politics.
Speaker 11: The economy seems to be going very well for you.
Speaker 11: In politics, it's harder your party is behind the party
Speaker 11: to popular We've also got Vox coming up this much
Speaker 11: more right wing outfits, and then the current polls you
Speaker 11: would lose if the election. What do you think the
Speaker 11: problem is? You've got a good economy, unlike most other
Speaker 11: European prime ministers, and yet you're still behind POSA polls.
Speaker 6: I mean, of course you have to look into it.
Speaker 6: You have to see.
Speaker 12: What I am defending is that, unfortunately we're seeing not
Speaker 12: only in Spain but across Europe a political collapse of
Speaker 12: the center rights traditional parties, which, by the way, it
Speaker 12: started after the financial crisis with the failure of governments
Speaker 12: with all this rhetoric of austerity UH, banking UH and
Speaker 12: the financial rescue that we had to pay with taxes
Speaker 12: all around Europe. And what you see now from the
Speaker 12: center right is that they are copying not only the
Speaker 12: way of doing politics of fire right, but also the contents.
Speaker 12: So you see now that they are like identifying migration
Speaker 12: with insecurity, which is a fake.
Speaker 6: It is not true.
Speaker 12: And and by the way, as I said before, when
Speaker 12: when you when when you see the figures in Spain,
Speaker 12: you can see that we had a we we have
Speaker 12: the contribution of migration, but at the same time we're
Speaker 12: reducing unemployment rates in Spain, and there are sectors such
Speaker 12: as construction, agro industry, or social services or tourism which
Speaker 12: Spain are quite important. We're up to twenty thirty percent
Speaker 12: of the total workers comes from different countries.
Speaker 6: And not Spain.
Speaker 12: So what we need to do is to face that
Speaker 12: we need migration. But for that migration, what we need
Speaker 12: to open is a path of regular migration. And this
Speaker 12: is what we are doing with many countries in Latin America,
Speaker 12: also with the US administration, with the previous administration, will
Speaker 12: reach a very interesting.
Speaker 6: Program in order to.
Speaker 12: Have this circular migration coming from the US and of
Speaker 12: course some countries in North Africa, but in all the
Speaker 12: contribution of migration to the economic growth in Spain is
Speaker 12: quite quite positive.
Speaker 6: As if you're you're brightening for that fight.
Speaker 11: So will you will definitely lead the Socialists in twenty
Speaker 11: twenty seven into the election?
Speaker 6: Yeah, I will do it for sure.
Speaker 12: This is something that I have already spoken with my
Speaker 12: family and with by party and if they allow me,
Speaker 12: I'm I'm confident that we can repeat a majority and
Speaker 12: to keep the work ahead. Not But let me add
Speaker 12: coming back to migration, that the dilemma that all Western
Speaker 12: societies we're facing is whether we open up and grow
Speaker 12: or we close off and drink.
Speaker 6: This is this This is the real dilemma that we
Speaker 6: need to face.
Speaker 12: So the challenge that we have within the European societies
Speaker 12: is how do we integrate this migration.
Speaker 11: So you think it's easier in Spain because you get
Speaker 11: a lot of people from Latin America where everyone speaks
Speaker 11: the same language. That's that's at least part of the
Speaker 11: argument why you might.
Speaker 6: Have been better.
Speaker 12: So when you listen to some central right parties and
Speaker 12: the far right there saying well, we we need to
Speaker 12: expel all these migrants come into our Okay, so what
Speaker 12: we do with demographics, because either you have Natali do
Speaker 12: you say family policies plus migration, but they don't propose
Speaker 12: anything in these two policies, no migrants and less welfare
Speaker 12: state and therefore less family policies. Uh, and that means
Speaker 12: uh social social services, wealth, healthcare and social security and
Speaker 12: so on and as well. So what I'm trying to
Speaker 12: say is that if we don't have this contribution of migration,
Speaker 12: but we will face in the coming years in Europe
Speaker 12: is that we have anest technicians we don't, we won't
Speaker 12: have the capacity to growth and therefore there would be
Speaker 12: more cuts in our welfare state. So so this is
Speaker 12: this is something that we need to explain to our
Speaker 12: citizens that if we articulate a positive migration policy, that
Speaker 12: would be for the good of the Europeans and the
Speaker 12: Western societies. So, just to give you a figure, ninety
Speaker 12: four percent of the total migrants that are leaving nowadays
Speaker 12: in Spain came from regular let's say systems, and they
Speaker 12: are they came on legal basis. So we're talking about
Speaker 12: only six percent and this is the reality. So I
Speaker 12: think that we need to fight and to give a positive,
Speaker 12: let's say, message about the contribution of migration to our
Speaker 12: societies and to our prosperity.
Speaker 4: That was Pedro Sanchez, Prime Minister of Spain, with Bloomberg
Speaker 4: News Editor in chief John Micklethwaite.
Speaker 3: You're listening to Bloomberg Business Week, coming up more on
Speaker 3: global efforts to stem climate change, with someone who has
Speaker 3: been a key player when it comes to United Nations
Speaker 3: climate efforts.
Speaker 4: This is Bloomberg.
Speaker 2: This is the Bloomberg Business Week Daily Podcast. Listen live
Speaker 2: each weekday starting at two pm Eastern on Apple car
Speaker 2: Play and the Android Auto with the Bloomberg Business app.
Speaker 2: You can also listen live on Amazon Alexa from our
Speaker 2: flagship New York station Just Say Alexa played Bloomberg eleven thirty.
Speaker 13: Another unofficial stated in nineteen eighty nine that within a decade,
Speaker 13: entire nations could be wiped off the map by global
Speaker 13: warming not happening. You know, it used to be global cooling.
Speaker 13: Now they could just call it a climate change, because
Speaker 13: that way they can't miss. It's the greatest con job
Speaker 13: ever perpetrated on the world.
Speaker 6: In my opinion, If.
Speaker 13: You don't get away from this green scam. Your country
Speaker 13: is going to fail.
Speaker 3: That was President Trump and is addressed to the United
Speaker 3: Nations this past week. As we mentioned earlier, the President
Speaker 3: was very critical of climate change. Now keep in mind,
Speaker 3: not all global leaders in town felt that way. We
Speaker 3: talked to a lot of them, as many attended more
Speaker 3: than one thousand events about actions and investments in renewable
Speaker 3: sources of energy and ways to tackle the climate crisis.
Speaker 4: One of those was Mack Mood Mohill Dean. He's UN
Speaker 4: Climate Change High Level Champion for COP twenty seven that
Speaker 4: was held back in twenty twenty two. He's also a
Speaker 4: former World Bank Senior Vice President and former Minister of
Speaker 4: Investment of Egypt. Macmoud joined us from the Bloomberg Philanthropiece
Speaker 4: Global Forum.
Speaker 14: Well, I see it around the world, especially in many
Speaker 14: of the emerging markets countries of the Global South, in
Speaker 14: Europe and Latin America. It's moving, progressing despite the political
Speaker 14: statements and political hurdles because becoming today more affordable comparing
Speaker 14: what you can produce of electricity from renewables compared to
Speaker 14: fossil fuel.
Speaker 1: So it makes sense just to compare the cost.
Speaker 14: So people are progressing towards decarbonization and investing renewables because
Speaker 14: it's much more affordable and cost effective.
Speaker 4: So the market is the market is making this decision.
Speaker 14: Market absolutely, And a few weeks back what gives us
Speaker 14: hope based on some interesting big read article from the
Speaker 14: Financial Times that what gives us hope is technology, technology innovation.
Speaker 14: What we were producing at multiple of costs ten years ago.
Speaker 14: Each time we tried to cite a figure, we get
Speaker 14: corrected because of the lowering of cost. And when it
Speaker 14: comes to electricity, am I went, they're saying that about
Speaker 14: the cost of adaptation. So, as you know, climate change
Speaker 14: had those two wings, the mitigation part or investing in
Speaker 14: the organization renewables that's becoming more affordable. But when it
Speaker 14: comes to adapting countries, societies and economies to the climate
Speaker 14: change and its risk, here we need to mobilize more
Speaker 14: public finance because the cost return is not really as
Speaker 14: straightforward when it comes to commercial market basis compared to decarbonization.
Speaker 3: There, I want to ask you, So there was President
Speaker 3: Trump an hour address to the you and General Assembly
Speaker 3: out there were there, you were there, and some very
Speaker 3: strong words when it came to climate change. I'm curious
Speaker 3: when you have conversations with members of the administration. Are
Speaker 3: they as opposed in terms of US strategy what they
Speaker 3: talk about US strategy being opposed or well not supportive
Speaker 3: policies to stem climate change.
Speaker 14: Members of the US Administration follow their leader and their.
Speaker 3: I was curious back to our conversations.
Speaker 14: But we see as well some practical pragmatic statements, like
Speaker 14: a recent statement that came out comparing investing in renewables
Speaker 14: in the form of solar versus wind farms. So there
Speaker 14: was a kind of a statement that tells us, well,
Speaker 14: you can invest better in solar, and then there is
Speaker 14: a great deal of investments as well in innovation when
Speaker 14: it comes to battery storage and all of that. So
Speaker 14: we see some opportunistic approaches and more pragmatic approaches, but
Speaker 14: not really to oppose these strong statements coming from their boss.
Speaker 3: Can I ask you in terms of cop this year,
Speaker 3: I'm just curious how Copple work this year in such
Speaker 3: an active kind of climate hostile that we see from
Speaker 3: the United States. Well, is that a problem not having?
Speaker 14: Of course, of course it is for the biggest economy
Speaker 14: in the world, with the great deal of dynamism inventions,
Speaker 14: innovation that could really help not just the United States,
Speaker 14: but the rest of the world. We are missing a lot.
Speaker 14: But having said that, two things. Finance for Development Conference
Speaker 14: in Seville that took place a few weeks ago. It
Speaker 14: was fantastic, it was successful, it delivered. It was all
Speaker 14: the world minus one, So that gives hope. The second
Speaker 14: thing the preparation for COP thirty when I was in
Speaker 14: Reo and their Climate Action Week, great deal of dynamics participation,
Speaker 14: not just at the leader's level, but community, private sector,
Speaker 14: civil society.
Speaker 1: So it is happening. So again, the world minus one.
Speaker 4: You've spent a lot of time thinking about emerging and
Speaker 4: developing economies, and here in the US, with the dismantling
Speaker 4: of USAID, with the pullback in foreign aid, this narrative
Speaker 4: has seemed to emerge, which is basically like, why should
Speaker 4: we be sending money to countries outside of the United
Speaker 4: States when there are people here in the US that
Speaker 4: need that money. What would you say to that?
Speaker 1: Well, there is an evolution of thinking.
Speaker 14: At the beginning of start of the aid there was
Speaker 14: the issue of consideration of others, and there's some sort
Speaker 14: of altruistic behavior that we need to help the rest
Speaker 14: of the world. The countries on the rich economies, and
Speaker 14: there was some elements as well of compensation, especially from
Speaker 14: the colonial powers that well, we exploited the resources of
Speaker 14: these poor countries, so let's help them. And then it
Speaker 14: came as well issues related let's do the help because
Speaker 14: we will benefit more, even if a kind of self
Speaker 14: interest will like stability, we like bigger markets, well, like
Speaker 14: people to follow the same kind of standards, and we
Speaker 14: need to eliminate force migration. So there was a kind
Speaker 14: of mix of ideas between positive and negative. But then
Speaker 14: we are in a new world now and I think
Speaker 14: it very much the end of official development assistance.
Speaker 1: As we know it. You do, yes, of course, not
Speaker 1: just from USID, and it's a.
Speaker 14: Disappearance suddenly, but actually from other sources as well.
Speaker 4: So what does the world look like, particularly the developing
Speaker 4: world in this new era.
Speaker 14: It depends really where you are addressing the issue. For
Speaker 14: there are many countries, including my brothers. I'm an African
Speaker 14: and Egyptian, my brothers from South Sudan for instance, or Burundi,
Speaker 14: they are more dependent on external help and support when
Speaker 14: it comes to their budgets. Other countries would use aid
Speaker 14: as a kind of cathalytic help to help and bring
Speaker 14: in the private sector elements of innovation, blended finance, so
Speaker 14: they will survive without aid. That other countries that are
Speaker 14: more dependent, especially in humanitarian work human development, they need
Speaker 14: really to get new sources, including from philanthropies.
Speaker 4: Would you argue that there is a soft power element
Speaker 4: still to this as well, that there is a benefit
Speaker 4: for and look, I think this was an example used
Speaker 4: in New York Times article months ago. I've seen that
Speaker 4: one like, you know, a bag of rice shows up,
Speaker 4: it has an American flag on it. Yeah, somebody in
Speaker 4: some far flung place sees that and says I have
Speaker 4: a different view of America and an American As a result, it.
Speaker 14: Helped promoting American values American culture, so positive to the
Speaker 14: United States in this case. But you can really see
Speaker 14: aid in different ways as well from the recipient countries.
Speaker 14: If aid is basically prioritizing what the nationals and the
Speaker 14: communities are pushing for and hoping for, this is a
Speaker 14: good thing. If it is a catalyst for transformation, it's
Speaker 14: a great thing. But if it is crowding out public finance,
Speaker 14: if it is crowding out private sector, then you have
Speaker 14: other considerations, So there could be some sort of blessings
Speaker 14: in disguise when we are addressing these kind of changes.
Speaker 3: China has been in the past, certainly very aggressive when
Speaker 3: it comes to providing funding, especially for the developing world.
Speaker 3: Just do wonder, in an absence of other developed nations
Speaker 3: helping out the developing world, is China step up its efforts?
Speaker 6: Is there?
Speaker 3: And is that a problem?
Speaker 14: Yes, Like the old rules of nature and physics, when
Speaker 14: there is a gap, there will be a vacuum.
Speaker 1: We find somebody trying to help you.
Speaker 14: We see the role of China's rising, the role of
Speaker 14: many of the middle powers rising. The role of regional
Speaker 14: powers is rising as well, so and the role of
Speaker 14: foundations philanthropies, not just the big names that we're familiar with,
Speaker 14: but some of the smaller ones coming from the regions.
Speaker 14: And this comes associated with benefits including soft power. The
Speaker 14: issue that you mentioned or you cannot really draw a
Speaker 14: line now between what's aid and what's promotion for investment
Speaker 14: or promotion for experts. So there will be some serious
Speaker 14: spillovers given this kind of sudden cut.
Speaker 3: Are there is the money getting to the emerging world
Speaker 3: that needs it. In terms of certainly when it comes
Speaker 3: to climate initiatives, they are so vulnerable.
Speaker 14: No, no, no, the development finance system and the climate
Speaker 14: finance system. I described it before we were preparing for
Speaker 14: a COP twenty seven and after that has been insufficient
Speaker 14: because there is a widening gap, Inefficient because it takes
Speaker 14: forever until you mobilize funds, and unfair because of costs,
Speaker 14: and we still suffer from the same problems. Now well,
Speaker 14: perhaps better public private partnerships, with the support of philanthropies,
Speaker 14: we can mobilize funds in a better way.
Speaker 4: That was Matt Mood, Mohil Dean, you and Climate Change
Speaker 4: high Level Champion for COP twenty seven. That was back
Speaker 4: in twenty twenty two.
Speaker 3: You know, I think what was interesting Tim, as we
Speaker 3: did these conversations with global leaders, and you know, we
Speaker 3: talk about climate so much on Bloomberg Business weekdaily. But
Speaker 3: I think what was fascinating is that global leaders they're
Speaker 3: moving ahead with their initiatives. I felt like we heard
Speaker 3: that very much from the European contingencies. But I also
Speaker 3: know in having some offline conversations with companies that they
Speaker 3: too are not thinking necessary in presidential terms when it
Speaker 3: comes to strategy and policies and about their impact on
Speaker 3: the climate, and so they're thinking much more longer terms.
Speaker 3: So interesting to hear that the spend and the activity
Speaker 3: is still moving on, and a lot of it has
Speaker 3: to do with I feel like. Another message this past
Speaker 3: week was the idea that renewables they make sense now
Speaker 3: right in terms of financially what they cost or how
Speaker 3: to go about them.
Speaker 4: So we heard that over and over again, and that
Speaker 4: was pretty surprising to me because what as I understand it,
Speaker 4: the investment in these renewables in the beginning can be
Speaker 4: pretty high. But some of the European leaders, Carol told
Speaker 4: us that, hey, this is actually the market taking care
Speaker 4: of itself here. These energy sources for us at least
Speaker 4: are on par or cheaper than what we used to get.
Speaker 4: So this is the way we are moving forward. The
Speaker 4: question that I have for the United States is are
Speaker 4: we going to be left behind? If the vision at
Speaker 4: the top changes, Let's say the next administration wants to
Speaker 4: invest in net zero or wants to invest in renewables,
Speaker 4: are we going to be left behind? Certainly, the idea
Speaker 4: of nuclear is something that President Trump has talked about
Speaker 4: a lot, but up till now, Carol, we know that
Speaker 4: these projects take a very very long time, right, very
Speaker 4: expensive upfront, and the US has not built very many
Speaker 4: new reactors in the last few years.
Speaker 3: And we're going to find out how important it is
Speaker 3: to have the government support, whether it's regulatory, business initiatives,
Speaker 3: so that the private sector can go about and developing
Speaker 3: all of this. It brings to mind there's an incredible
Speaker 3: story on the Bloomberg this past week and exclusive, and
Speaker 3: it talked about venture capitalists from Western firms are starting
Speaker 3: to say out loud what they've suspected for a while,
Speaker 3: and that is China's dominance has left key sectors in
Speaker 3: the West uninvestable. And they visited factories, they spoke with
Speaker 3: startup investors in China, and what's interesting is the VC's
Speaker 3: plan to avoid allocating funds to Western startups that cannot
Speaker 3: compete with Chinese peers, with some already halting investments in
Speaker 3: Western battery cell manufacturers and looking to collaborate with Chinese firms.
Speaker 3: But I think about things like solar panels and renewables
Speaker 3: where China has been spending evs right big time, and
Speaker 3: many would say are definitely ahead of the US here.
Speaker 4: Yeah, don't forget the reality is China is the world's
Speaker 4: largest source of carbon emissions, but at the same time
Speaker 4: it's also the strongest motor guiding the planet to a
Speaker 4: low carbon future. So the relationship that the United States
Speaker 4: has with China right now, the fact that we need
Speaker 4: certain materials or certain things in order to have renewables
Speaker 4: in the world come from China. So Yeah, this is
Speaker 4: a great story on the Bloomberg Terminal, written by Alistair Marsh.
Speaker 4: Do you check it out if you have their time.
Speaker 3: Dill ahead on Bloomberg BusinessWeek, the CEO of Canada's Bilateral
Speaker 3: Development Financial Institution. As our coverage from this week's Bloomberg
Speaker 3: Philanthropy's Global Form.
Speaker 4: Continues, This is Bloomberg.
Speaker 2: You are listening to the Bloomberg Business Weekdaily Podcast. Catch
Speaker 2: us live weekday afternoons from two to five pm Eastern
Speaker 2: Listen on Apple CarPlay and Android Auto with the Bloomberg
Speaker 2: Business app, or watch us live on YouTube.
Speaker 3: Carol Masser along with Tim stenoviek Rookier at Bloomberg Philanthropy's
Speaker 3: Global Form, We're going to continue with some great conversations
Speaker 3: from this event.
Speaker 6: Yeah.
Speaker 4: The event brings together heads of state business leaders to
Speaker 4: address the world's most urgent challenges and opportunities. Among those
Speaker 4: challenges and opportunities is sustainable economic development, and that's where
Speaker 4: Lori Kerr comes in. She's the chief executive officer of
Speaker 4: FINDEV Canada. It's Canada's bilateral development of finance institution. She
Speaker 4: joins us on set here at the Plaza Hotel. How
Speaker 4: are you.
Speaker 7: I'm great, It's really great to be here. Thanks so
Speaker 7: much for having me.
Speaker 4: Thanks gut gad to have you here. I feel like
Speaker 4: our conversation this year would be a lot different than
Speaker 4: our conversation last year if we were to have that.
Speaker 4: We're going to get to that in a minute. You
Speaker 4: invest in Africa, Latin America, the Caribbean in a world
Speaker 4: that many would argue as turning inward. How do you
Speaker 4: convince Canadians that what you're doing is in their best
Speaker 4: time interest?
Speaker 7: Well, I mean, if I quote some of the recent
Speaker 7: speakings of the of our own Prime minister, he certainly
Speaker 7: recognizes that when developing countries prosper, Canada prospers as well.
Speaker 7: It's a time to really lean into global partnerships to
Speaker 7: build resilience in global economic growth.
Speaker 3: How do you prioritize how to do that? Because I'm
Speaker 3: sure there's a lot of folks saying we need.
Speaker 7: Help, absolutely and quite honestly, like the demand is limitless
Speaker 7: for what findev Canada offers and other bilateral development finance institutions.
Speaker 3: So how we approach our.
Speaker 7: Financing and investment decisions is, of course, we have to
Speaker 7: have commercial sustainability, that's what we're going to We want
Speaker 7: to have vibrant market and we also look through three
Speaker 7: impact lenses. We have three impact lenses through which we
Speaker 7: work that informs all of our financing and investment decisions.
Speaker 7: Climate and nature action, gender equality, and local market development.
Speaker 3: Has to check on all of those in order for
Speaker 3: it to happen, or not.
Speaker 7: All of them, because different types of investments in financing
Speaker 7: opportunities will address one or more of them. We obviously,
Speaker 7: you know, look to try and have positive contribution across
Speaker 7: each of those, but not everything ticks every box, so
Speaker 7: to speak.
Speaker 4: I feel like in this administration, in the environment that
Speaker 4: we're in the United States, those those boxes would not
Speaker 4: exist under this current administration. Does that? How do you
Speaker 4: think about that?
Speaker 7: Well, it's again, it's a real wonderful opportunity for Canada's
Speaker 7: to show global leadership and again, when developing countries prosper,
Speaker 7: Canada prospers, and the world prospers. So it's an opportunity
Speaker 7: for us to continue with looking at having impact in
Speaker 7: the markets that we serve.
Speaker 4: So with the US pulling back on foreign aid, with
Speaker 4: the US dismantling US aid, which certainly is controversial here
Speaker 4: in this country, as I'm sure you're aware, does it
Speaker 4: mean more of an opportunity for Canada or net net?
Speaker 4: Does it hurt Canada and does it hurt the world
Speaker 4: in the long run?
Speaker 7: Well, I think certainly there's a lot of hugely, hugely
Speaker 7: negative impacts from a huge amount of the age a
Speaker 7: bathtub sort of a plug being pulled, so to speak.
Speaker 7: But we have to look at that as an opportunity, right,
Speaker 7: as I mentioned when we just started that, you know,
Speaker 7: demand for development finance, you know, is steep, but now
Speaker 7: it's really infinite because the US has traditionally played such
Speaker 7: a very big role in development data and in development finance.
Speaker 7: So in a way, it's a tremendous opportunity for countries
Speaker 7: like Canada and like munded countries to lean in.
Speaker 3: Laura, I'm always interested in the specifics of things, so
Speaker 3: talked to us about some things that where there have
Speaker 3: been investments made and what's the outcome.
Speaker 13: Yeah.
Speaker 7: Absolutely, So let me give you one example. So we
Speaker 7: were established in twenty eighteen, so we're the youngest bilateral
Speaker 7: development finance institution and one of our very first investments
Speaker 7: is in a company called Climate Investor one, and they're
Speaker 7: supporting energy transition across Africa, across Asia and across Latin America.
Speaker 7: So in twenty eighteen we made a twenty million dollar
Speaker 7: equity investment and now they've been able to raise eight
Speaker 7: hundred million dollars. Eighty percent of that is dispersed across
Speaker 7: sixteen renewable energy projects. Six of them are already in operation,
Speaker 7: so that's renewable energy on grids, that diversification of energy matrices,
Speaker 7: that's supporting local economic and local ecodonomic growth, so really
Speaker 7: having a positive impact. So they've been a really great
Speaker 7: example of how using public resources through development finance can
Speaker 7: really mobilize private capital and show that commercial viability and
Speaker 7: positive impact in climate can go hand in hand.
Speaker 4: We have been speaking about the potential economic effects of
Speaker 4: pullback and aid by the United States and other countries
Speaker 4: filling that gap, but as we just heard Just moments
Speaker 4: ago we were speaking with Mamud Mohielden who basically said
Speaker 4: the era of developing countries being helped by other countries
Speaker 4: is over in his view. Do you agree with him?
Speaker 7: Interesting? So what I would say, it's definitely a repositioning, right,
Speaker 7: I think we've for the last you know, fifteen twenty years,
Speaker 7: it's been an era and the era is changing for sure,
Speaker 7: So there's disruption in this system. Again, I do think
Speaker 7: that there are many countries that are still looking to
Speaker 7: play their part, believe that there is a role like
Speaker 7: Canada believes there is a role for Canada play in development.
Speaker 7: So it's a reordering it, it's a reawakening and it's
Speaker 7: much more about partnership I think going forward.
Speaker 4: Do you think about it from an immigration perspective at all?
Speaker 4: The idea that if you are able to improve conditions
Speaker 4: in other countries, the people who live in those countries
Speaker 4: will not feel forced migration.
Speaker 3: Absolutely.
Speaker 7: I think you know, Canada is differently situated than many
Speaker 7: of our European friends and partners in terms of the
Speaker 7: immigration issue. But certainly you know, one of the value
Speaker 7: added of supporting local market growth and local market development
Speaker 7: through the private sector is providing jobs. When you provide jobs,
Speaker 7: you provide incomes. When you provide incomes, you have a
Speaker 7: growing middle class. When you have a growing middle class,
Speaker 7: you actually provide export opportunities for countries like Canada. When
Speaker 7: you provide good jobs, people are happy to stay at
Speaker 7: home and work and thrive in those local economies. So
Speaker 7: there's it's a reinforcing benefit, let's say, of supporting emerging markets.
Speaker 3: What's been the biggest impact on your world as a
Speaker 3: result of what I would say is a conflicted relationship
Speaker 3: between the US and Canada now, which is kind of
Speaker 3: amazing to kind of get your head around. Anybody who's
Speaker 3: you know, steadied trade or history. Who to think, But
Speaker 3: this is where we are a little bit today. But
Speaker 3: what has been the impact on your world because of it?
Speaker 1: Yeah?
Speaker 7: So in the development finance world, it's again it's been
Speaker 7: a huge disruption. I mean, the US has been such
Speaker 7: an enormous player in development finance, as I said earlier,
Speaker 7: so we're all having to reposition ourselves. It's providing a
Speaker 7: lot more opportunity and an impetus really for collaboration.
Speaker 3: Amongst the DFI community.
Speaker 7: So the bilateral DFIs we're a humble, but we're really
Speaker 7: a mighty bunch and we really need to be supercharged.
Speaker 7: We co finance and we co invest sort of as
Speaker 7: a matter of course, we're again very collegial.
Speaker 3: Well who else is stepping up with you? And you
Speaker 3: feel like really kind of all right, So if the
Speaker 3: US isn't going to be so active in it, what
Speaker 3: other you know, country or so on and so forth
Speaker 3: that are working more closely with you.
Speaker 7: Yeah, So we work a lot with so the bilateral
Speaker 7: so for example, with PROPARCO in France, with a British
Speaker 7: International Invest in the UK, with FMO in the Netherlands,
Speaker 7: with DG in Germany. So I mean, there's a number
Speaker 7: of the European development finance institutions that we work with.
Speaker 7: We also do co finance with the IFC, and in fact,
Speaker 7: just this week we're really happy to be closing one
Speaker 7: hundred and twenty five million dollars worth of transactions to
Speaker 7: two banks in Central America, Banko Industrial in Guatemalas we're
Speaker 7: providing a seventy five million dollar loan. Guatemala is one
Speaker 7: of the most scientific and vulnerable countries in Central America.
Speaker 7: Use of proceeds entirely for climate finance, so climate smart
Speaker 7: agriculture and green buildings. And then the other transaction is
Speaker 7: fifty million dollars to Bengal Payis in Honduras and that's
Speaker 7: one of the poorest countries in Central America. There, we're
Speaker 7: also supporting climate finance, renewable energy, water and sanitation, as
Speaker 7: well as small and medium sized enterprises, micro small and
Speaker 7: medium sized enterprice and women owned and women led microansmalls.
Speaker 3: Because I mean, I always think about all the micro
Speaker 3: lending and some stuff at the gap you do for women, right,
Speaker 3: and the impact that it has on a family in particular,
Speaker 3: How do you.
Speaker 4: Make sure that the money is used efficiently? And you know,
Speaker 4: there were so many stories at least with us money
Speaker 4: that went out where you'd find that, okay, well, grants
Speaker 4: that went to certain organizations weren't necessarily used in the
Speaker 4: most efficient way or even used for what they were
Speaker 4: supposed to be used for. How do you make sure
Speaker 4: that there's not sort of a.
Speaker 3: Fraud.
Speaker 4: Yeah, I didn't want to say fraud. I just want
Speaker 4: to say there's somebody who sort of takes more than
Speaker 4: they're supposed to.
Speaker 7: Sure, So, I mean we're in the commercial financing business, right,
Speaker 7: we provide financing and investment. We have a higher risk
Speaker 7: appetite than commercial capital, but you know, again we want
Speaker 7: to provide, we want to support commercial viable solutions. Part
Speaker 7: of the impact framework that we as development finance institutions
Speaker 7: bring to the fore is sort of the rigor and
Speaker 7: vigor around the impact and the reporting. So you know,
Speaker 7: we do go in and we have the measures in
Speaker 7: the metrics to actually be on the ground and make
Speaker 7: sure that we're getting the information back, the data back,
Speaker 7: we go out and verify that. So again it's the
Speaker 7: depth around measurement, impact, evaluation and reporting that makes us
Speaker 7: thrive and allows us to actually have impacts in the
Speaker 7: markets that we serve.
Speaker 4: Our thanks to Lori Kerr, CEO of FINDEV Canada, it's
Speaker 4: Canada's bilateral development financed institution.
Speaker 3: Hey, before we wrap up, and I highly recommend you
Speaker 3: check out a bunch of stories at the Bloomberg and
Speaker 3: at Bloomberg dot com because our whole team, our global
Speaker 3: team was in town and reporting out everything that was
Speaker 3: coming from the U in General Assembly and Climate Week
Speaker 3: NYC and one other stories we wanted to bring to
Speaker 3: your attention because when we talk about climate change in
Speaker 3: the environment, you got to think about China. It's the
Speaker 3: world's largest polluter, and it did set a target to
Speaker 3: cut economy wide net greenhouse gas emissions by seven to
Speaker 3: ten percent over the next decade. It's a strategy that's
Speaker 3: seen as too modest with the nation on a path
Speaker 3: to net zero and galvanize global climate action. When you
Speaker 3: look at the big countries, the big polluters, like what
Speaker 3: they do, it matters.
Speaker 4: The promised reduction from China's peak levels follows President Chijin
Speaker 4: Pink's pledge that was back in April to pursue more
Speaker 4: stringent curbs and to set policies that cover the entire economy,
Speaker 4: addressing pollutants beyond carbon dioxide. Now, Carol, it follows a
Speaker 4: tradition of Chinese leaders who've set relatively modest climate targets
Speaker 4: only to surpass them later.
Speaker 3: Yeah, and you know, so it's interesting, right, and we've
Speaker 3: got to just think about the world and the connections here,
Speaker 3: I will say. The European Union's Climate commissioner did say
Speaker 3: that China's latest goals were met with criticism, calling the
Speaker 3: level of ambition clearly disappointing and saying it makes reaching
Speaker 3: the world's climate goals significantly more challenging.
Speaker 4: Well, I mean it's a big deal that China's talking
Speaker 4: about that.
Speaker 3: Well, that's my other big tech takeaway with everything going
Speaker 3: on in the world, and I kind of compared to
Speaker 3: last year where we're head of a big US election
Speaker 3: and conversations were different. At climate change was talked about
Speaker 3: a lot. And that wraps up our weekend edition of
Speaker 3: Bloomberg Business Week from Bloomberg Radio. Of course, our highlights
Speaker 3: from this past week's Bloomberg Philanthropy is Global form. You
Speaker 3: can catch all the conversations from the event on the
Speaker 3: Bloomberg and at Bloomberg dot com. Thank you so much
Speaker 3: for joining us.
Speaker 4: Be sure to tune into Bloomberg Business Week daily Monday
Speaker 4: through Friday. It starts at two pm Wall Street Time
Speaker 4: on Bloomberg TV, Bloomberg Radio, and on Sirius XM Channel
Speaker 4: one twenty one. You can also listen to us an Apple
Speaker 4: Car Play and Android Auto Free in the Apple app
Speaker 4: Store or on Google Play.
Speaker 3: You can also watch our daily broadcast on YouTube just
Speaker 3: search Bloomberg Podcasts, or simulcast on Bloomberg Originals available at
Speaker 3: Bloomberg dot com, Slash Originals and streaming platforms including Roku, Amazon, fireTV,
Speaker 3: Samsung TV Plus and more.
Speaker 4: Find our Bloomberg Businessweekdaily Podcast at Bloomberg dot com, Apple,
Speaker 4: or wherever you get your podcasts, and the latest edition
Speaker 4: of the magazine. It's available on newsstands now at Bloomberg
Speaker 4: dot com and always on the Bloomberg Terminal. I'm Tim
Speaker 4: Stinebeck and I'm Carol Masser.
Speaker 3: Have a good and safe weekend. Take care of Mother Earth.
Speaker 2: This is the Bloomberg Business Week Daily Podcast, available on Apple, Spotify,
Speaker 2: and anywhere else you get your podcasts. Listen live weekday
Speaker 2: afternoons from two to five pm Eastern on Bloomberg dot com,
Speaker 2: the iHeartRadio app, tune In, and the Bloomberg Business app.
Speaker 2: You can also watch us live every weekday on YouTube
Speaker 2: and always on the Bloomberg Terminal.