UPM_Biofore_Magazine2016_ENG_160623_e-magazine_72dpi

Energy consumption by region

Global GDP growth is set to slow down over the next 50 years, 2010–2060

18

Other

15

4.0

Other Asia

12

3.0

9

Persentage points

China

2.0

6

Billion Toe (tonnes of oil equivalent)

Non-OECD

1.0

OECD

3

OECD

0

0

Global population trends United Nations population growth estimates by continents, million people

1965

2000

2035

2001–2010 2010–2020 2020–2030 2030–2040 2040–2050 2050–2060

BP 2016 Energy Outlook

OECD

12 Million people

Randers’ recent book “2052 – A Global Forecast for the Next Forty Years” has been translated into nine languages and has sold 150,000 copies. Environmental organisations criticize Randers for being overly optimistic in believing that there

40 years. At the same time, he anticipates that population growth will start to slow down and reach a peak of 8.1 billion people in 2040. This means that average consumption per person will grow. Randers is nevertheless hopeful that in the future a larger portion of national income will be spent on investments in a sustainable future instead of daily commodities. Within the last couple of decades, an average of 25% of national product has been spent on investments. In the future, we might have to increase this to 40%. By investments, Randers means infrastructure like roads and production facilities, transportation and education. A vast amount of money will have to be spent everywhere in the world adjusting to climate change and repairing its damage . “The rise of the sea level will force the Netherlands to build higher protective barriers. Norway will have to excavate long tunnels to protect the roads in the mountainous fjord areas from landslides caused by the melting of permafrost,” Randers explains. The game is not lost yet The transition from fossil fuels to renewable and emission- free energy sources will also require massive investments, as will the increasingly efficient use of natural resources. As for future investment needs, Randers adds the struggle to reduce global poverty and economic inequality. Without corrective actions, refugees and armed conflicts threaten the stability of global political and economic systems. Randers emphasizes that despite the grim outlook, the game is not over yet. “What we need now are solid, long-termdecisions based on facts to guide society in the right direction.”

a positive effect on UPM’s business. “They increase the demand for pulp, hygiene, wood and label products especially in developing economies.” Ahead of the curve with Biofore Business based on renewable and recyclable raw materials is at the core of UPM’s Biofore strategy. Ståhlberg believes this to be a solid foundation for the future.

4

8

Africa Asia Europe Latin America and the Caribbean North America Oceania Global Africa Asia Europe Latin America and the Caribbean North America Oceania Global Africa Asia Europe Latin America and the Caribbean North America Oceania Global Africa Asia Europe Latin America and the Caribbean North America Oceania Global

will be no shortage of food and water if humankind only makes the right choices. Meanwhile, many people in the business sector criticize him for not having enough trust in the free market’s ability to mend these issues. “I have been criticized equally by both sides – it has made me evenmore convinced that my prediction is solid. The biggest difference to before is that we now have enough information to make a realistic estimate for the next decades.”

“For a long time now, UPM’s businesses have been based on sustainable ground. It helps us to answer the pressure for change and gives us a competitive advantage over many competitors.” The fight against climate change received an

encouraging boost from the Paris Climate Conference in December. UPMhas joined the fight by developing bio-based fuels to replace fossil energy sources producing emissions. The company also produces biocomposites and bio­ chemicals to replace oil-basedmaterials. These products create added value andmay be a significant source of growth in the future. “UPM’s strong balance sheet and income stream enable us to invest also in riskier prospects that may become new growth sectors in the future.” Ståhlberg points out that retaining competitiveness requires continuous improvement of cost efficiency and productivity. “UPMhas shown that it is possible for a company using renewable rawmaterials to continuously improve its productivity.” Ståhlberg notes that the revenue per hectare of forest plantation has increased significantly. “By increasing productivity, we are able to spread wellbeing among the owners, employees and the surrounding society.”

Kari Ståhlberg

Megatrends mean big opportunities UPM’s strategy director Kari Ståhlberg believes the challenges related to the Earth’s carrying capacity can be overcome. Natural resources are used and recycledmore efficiently than before, which helps to satisfy the growing demand associated with population growth and higher living standards. “I believe that the world will continue to go forward and become a better place for us all to live in. Higher living standards in China and other developing economies do not affect western countries negatively,” says Ståhlberg. UPM follows global megatrends closely because they create both challenges and new opportunities for the company. For example, urbanisation, the growing middle class and the increased purchasing power of consumers have

Source: United Nations, World Population Prospects: The 2015 Revision.

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