Businessweek Extra-Rajiv Shah

widened by the pandemic. The Foundation pledged a billion dollars this week to help address the COVID nineteen pandemic, expanding access to testing and vaccines globally, and also providing the foundation to encourage billions of dollars worth of investments in green energy. It's really all about bringing power electricity to the more than eight hundred million people worldwide who do not have it. It's all about getting control of COVID and ending energy poverty. I talked with him from the

Toronto Global Forum. But Rockfeller actually has been around for a hundred and seven years as an institution that worked on the pandemic influences, So the the expertise and ability to contribute significantly predates my tenure. But but we in in sort of the January February March time friend really re oriented about a hundred million dollars of support towards COVID nineteen response, and felt from that point on that this was going to be longer and more challenging than

most people had predicted in that moment. And I think we're seeing that bear out. I mean, most most global pandemics of this scale do have two three four waves. I think, in particular, it will take a little bit longer than people realize to produce a truly affective vaccine and get it distributed. The global track record of law distribution of a new vaccine is that it takes longer

and requires much more effort than most people realize. So I'm believing that one is going to be a year continued continue to be defined by COVID nineteen, And in order for societies to really function effectively, they'll really have to understand how to combine traditional public health behaviors like wearing a mask and social distancing with a much much, much more aggressive rapid testing protocol to enable critical institutions around the world, certainly in the United States, to be

functional through a pandemic threat. I do wonder, too, do you look a lot at what's going on in Asia, especially in China that they have in many ways. I talked to somebody just this week, a big global real estate person, but who is very involved in Beijing and Shanghai. I mean they're getting back to work, that's right. I mean, I mean countries that have gotten the background transmission rate down to a very very low rate because of intensive,

focused lockdown efforts have been able to bounce back. And while there are second, third, fourth waves in those places, that's through in New Zealand and South Korea and Australia, in Germany and in China, they're able to manage through

its much more carefully. I will say, as we've looked around the globe, the one core characteristic of being able to be opened through second, third, and fourth waves of infections is a very effective, very rapid testing regime in place if everyone you know, if you think about it, solving a pandemic is actually really easy. You find out who's contagious and you take them out of the chain of transmission, and that requires a data driven response that

starts with knowing who is contagious. In COVID nineteen, about forty of the spread are people without symptoms. So countries that have had broad testing strategies, very rapid fifty minute turnaround times on test results, and a real capacity to take people who are positive, whether or not they have symptoms out of the chain of transmission. Are now open for business and will be open for business in countries

that have not done that will continue to struggle. Yeah, it's amazing how kind of clear it is what the playbook is, but yet we continue to struggle with it. Listen, this is also important right to getting our global economy back up and running. The theme of the Forum this year is a resilient economy, and there's a lot that goes into creating a resilient economy. You know, obviously getting this health crisis under control. Um, you need to have a job, You need to have the right policies in place,

the support of policies. I want to get to an announcement that the Rockefell and Foundation just made that I think really gets into creating a longer term resilient economy for so many. Tell us a little bit about this one billion dollar commitment that you guys just made, and it really is about disrupting me inequities that have been caused, um and really widened by the COVID nineteen pandemic. Well, you said really effectively that that's exactly what what we're

trying to do. I mean, I think we look across the course of h and right tremendously for the path of human opportunity and human inequity going forward. You know, it's not like we haven't had big crises before, Depression, world wars, the global financial crisis of two thousand and eight,

two thousand nine. What we've learned from all of those is the path a society and an economy takes in the recovery from that crisis defines the type of nation and ultimately the type of global economy we have ten fifteen years out if we recover the way we're currently poised to recover, which i'd say is slow, is focused on those with capital and not on those that depend on their labor to earn income, is deepening the inequities

that have already been illustrated by COVID nineteen. Than ten fifteen years from now, we're likely to have a world that's more vulnerable to climate change and that is much much more unequal, and I can get into that. So in the context of that, we we believe we have the ability to bring people together and reimagine new solutions to human inequity and economic development and green growth. And we're committing a billion dollars towards that objective over the

next few years. What's fascinating about it? And I think I bet somebody's hearing that, They're like, what is it? Is it committed to healthcare? Is it education? It's about electricity, It's about power, right, yeah, and its core it is actually about accelerating the COVID nineteen response in an equitable manner and then ultimately ending what we call energy poverty. The reason the acceleration of the COVID nineteen response in

an equitable manner matters so much is because community. The communities have been hardest hit are lower income minority communities. Their twenty three million jobless claims filed last week in the United States of America. America's six seven hundred billionaires have made about six or seven hundred billion dollars since COVID nineteen hit, probably having the best year ever in terms of income and wealth growth for the very very top.

And you know, that's the path we're on because society knows how to bail out capital markets and Frankly, we don't do such a good job of bailing out working families and those who depend on their labor. And we're not against strong FED action, in fact for supportive of

strong economic interventions that support the capital markets. We just want to see it being more equitable and we want to see more people who have the ability to get green jobs, have the ability to build a new infrastructure for a modern green economy be a part of the solution. Talk to us about the solution. So you know, I

think you know power electricity. It's something you know, Raje, that we all take for granted, certainly developed societies, and I don't think we think about I mean, I was blown away by one of the numbers that your team shared with me about the amount of people UM sustainable sources uh that you guys want to bring to one eight hundred million people in the world who now live without eight hundred million people that's a huge part of our global society, UM that are really left out. Tell

us how you how you think you can do this? Well, I'm glad you highlight the number I mean people. Yeah, I've been working on global poverty issues and different capacities for for two and a half decades, and the reality is people always say, well, there's no single silver bullet to ending poverty and creating opportunity, and that's absolutely accurate. At the same time, we know that the modern economy is increasingly digital and hyper connected, and you cannot connect

to that economy without electricity. So it should be shocking to people to know that eight hundred and fifty million people around the world live without access to a hundred and fifty kilowatt hours of power a year. That means they don't have a light bulb on in their home for the course of the year. It should be shocking that probably another billion and a half people live in economies with the number one constraint to job growth and too small business starts is in fact, access to reliable

power that can support busyness. Is you know, unreliable power that goes out every couple of hours. You can't start a business, you can't hire people, you can't invest in capital. And I've seen these communities. I've rock Fellow has been investing in them for more than a decade. We now have a set of solutions to this problem that are based on green technology, artificial intelligence, smart metering, new ways of bringing capital markets to the world's very poorest people.

And there's no reason why ten years from now we could not have eliminated energy poverty and brought one to two billion people into the modern global economy in a positive, hopeful way. That's what we're trying to do with as part of the recovery from COVID nineteen rash. How do

you do it? Because, um, just this whole idea of kind of developing, you know, and bringing electricity to so many, so many people a billion dollars, it's a large commitment what needs to happen, and I'm assuming you've got to bring in other partners to make it happen. Well, you're absolutely right. It's it's first, it's inspired by the reality

of science, techn oology, and innovation. We have always been an institution that believed if you worked extra hard to bring the scientific and technological frontier to the world's most vulnerable people, you can shape the nature of human opportunity. We did that fifty sixty years ago and creating something called a green revolution, where we helped triple quadruple crop

yields in some of the hungriest parts of the world. Today, a new green revolution would actually be recognizing that the billion people who live without meaningful access to power could simply benefit from new solar battery, mini grid AI technologies

that would allow them to connect and connect quickly. We've already served about four hundred thousand people in Northeast India who are characterized by extreme poverty and with whom we've pioneered new solutions that can provide solar energy at you know, somewhere around twenty cents of killow one hour. But you didn't work, right steen this work already? Oh yeah, we've rolled out hundreds. We actually have a billion dollar joint ventor with tatap Power in media allout ten thousands of these.

Not only do they work technologically, they work from a commercial perspective. The businesses, the business we started with Tata Power should and will both sustain itself and frankly be profitable over time. And uh, and most important to me

is they work from a poverty of reduction perspective. We study carefully the results of what we invest in, and we know that family served by our solar mini grids in rural parts of India have doubled their incomes, have increased their employment of others have been able to take farm output and sell it at better prices because the value addition they're able to do on farm is higher, and are moving the communities out of poverty. I've seen

it firsthand. We can it's life changing, right, I mean, this is you know, this whole idea of like disrupting. We talked about disruption all the time, right, and disruptors. This is really about disrupting the inequities. This is how you do it. Yeah, I think people get stuck. They get stucked on the idea that it has to be a sort of you know, either or that the eye is only so big and if and you've got to take it from someone to to give it to people

who are at the bottom. And that's not what we've observed. I mean, we've observed that there are ways to bring technology, science and commercial markets to the world's bottom two billion people in a way that fundamentally disrupts the reality of human inequity. And the reason now is the time to do it is because this is the big disruption, This is the big dislocation, This is the big crisis, and crisis has always presented opportunity in the in the spirit

of recovery. America had its strongest and most broadly shared economic period after World War Two, and we could get into why. But if we're going to bring that mindset to the global economy in this moment, we have to think differently and we have to be more ambitious on behalf of those who are suffering. Now, that idea of disruption. I can't tell you how many times it has come up here at Bloomberg and my conversations on air over

the last six seven months. That, yes, terrible crisis and we wish it hadn't happened, and certainly the impact them so many, But it's it's causing people to increase their timetable um to make changes and to figure out ways to do things better. And that sounds like this is an opportunity. What's the cost though, of doing something like this and bringing you know, eight million people who are really kind of left out in this world right now? Um,

what's it cost to kind of try and bring them in? Yes, so, our estimates of the cost to specifically end energy poverty the way we're defining it is roughly twenty to thirty billion dollars a year over the course of a decade. That may sound like a lot, although when you actually look at how much we are spending dealing with the consequences of inequity in the current crisis, it's really a

very very small and very efficient commitment. Of that thirty billion, on a manual basis, about half would be commercial investment or impact investment, and about half would be true public subsidy or public investment that goes alongside a number of

other activities. The if you ask that same question ten years ago or maybe fifteen years ago, I'd say ten maybe five years ago, I'd say the answer that question would have been hundreds of billions of dollars per year, and the pathway to success would have been would have fundamentally required, like governments everywhere, to start behaving better. Today,

it's different. Today, you don't need that much capital, and because of the pace of technology, and because we've proven that these business models can work on a commercial basis, you really don't need although it be nice, but you really don't need every energy utility around the world to start dramatically turning around its core performance. We work with utilities, we respect the mandates they have, but this is a vision that is more disruptive than depending on just fixing

the things that look broken into people. You know, it's interesting. I'm listening to you talking. You talk about the cost and I we Um had a story this week based on an economist different city group who tallied up and this is on a little bit of a different topic, but bias and the cost it is to our economy and and she tallied up it's like sixteen trillion dollars.

And I think about, all right, so we have this twenty billion dollar a year cost, but you think about if you can give these people power and they can be part of our system, right contributors, they can become consumers. I mean, the economic impact is just kind of off the charts. Well it's economic. It's also in the spirit of the work we do with really the world's most vulnerable people. It's all doing the right thing. It's a core concept around justice and moral um, you know, and morality.

I mean, I've and it was just in November and seeing some of the beneficiaries of our mini grid work in northern India, and you know, you meet, you meet. I met a young girl who you know, it doesn't get to go to school, doesn't have to read at night because there's no lighting. You know, what walks outdoors to fetch water and you know, in the middle of the night, and you know that that leads to gender violence, sexual violence, a lack of education, and really no genuine

sense of hopefulness for her future. And then we talked to her mother after the lights went on, you know, and after they became customers paying customers of a of a new technologically advanced solar mini grid that was managed by remote artificial intelligence, and all of a sudden, the whole sense of human aspiration changes. You know, everyone has a mobile phone, everybody sees what success can look like.

And then you feel that hopefulness of my daughter has a chance, and it changes the nature of human security, It changes the nature of human vulnerability. And uh. And it really is a strategy to lift up the whole concept of a green and global and inclusive recovery into a sort of something that means more about justice than

just economics. No, and I totally agree. I do wander rage what's different this time around, because you know, the injustices, the inequality of the inequities um that have been laid there again because of COVID nineteen globally, They're not new. They have been around for years. You talked about how much you know, your life's work has been on global poverty. The Rock and Filmer Foundation has been focused on it

for a long time. What's different this time around that you think, as you said, we kind of have this unique opportunity for disruption. What what makes you think it's different this time around? Well, things are different. The first is the moment we're in is extremely higher. So, for example, the World Bank estimates that four and twenty five million people around the world will be pushed back under an

expanded definition of the poverty line. That didn't happen even during the global financial crisis, That didn't happen during the period of the Cold War. I mean that that sort of reversal of human progress is is extremely unique to this particular crisis at that scale. And for us to just sort of throw our hands up and say, Okay, we're gonna lose two and a half decades of human progress in making the world more just, in creating more

opportunity for families, that would be a huge mistake. So I think the first big difference is just how significant the moment we find ourselves in the second one is the race to save the climate, right. And and if you just sort of say that while the bottom two billion people don't seem to use a lot of intensive materials and therefore don't produce that much carbon, you're sort

of missing the picture. Fifteen years from now, these folks will either develop their economies based on you know, Chinese investment in coal production, which is happening, you know, to the tune of a hundred and fifty giga watts around the developing world, or it will be fundamentally a green and modern economy that's much, much less problematic for the global climate situation. And these two things go hand in hand.

And you know, if you're poor, if you're suffering, and if your choice is one or the other, you're gonna take whatever makes sense in the moment. And if we don't make a more modern, more hopeful, more green solution, a strong equivalent option to what others are offering, we were not going to be successful at protecting our climate,

which does present existential threats to all of us. So I think about all of the people who are listening to this um and thinking about their role in all of this, whether they run a company, whether they run an institution, whether they're just one of the many you know, billions uh in our society. I mean, what would you say to them in terms of thinking about what you are setting out to do in the Rocketeller Foundation is

setting to do? What is kind of all of our roles in this Yeah, I would say everyone has a role. So so you know, media, your your sector has a role in bringing people to a broader vision of both

what's necessary and what's possible in doing it quickly. In my humble opinion, I think I think that the industrial and business sector has a tremendous role to play, especially for this particular example of the sort of energy and infrastructure community, because if you run a large energy company, you should you should have some awareness of this frontier, and you should be able to dedicate resources to where

your business touches on this frontier. I'd say, if you're a young entrepreneur somewhere in the world, I don't know what market you might be interested in, but the idea that you can be part of a of a truly green revolution for the world's poorest people that will help them move up the economic ladder and do so in a green manner is so rife with real opportunity, so rich with opportunity. I mean, I met entrepreneurs that were developing the AI platforms to remotely manage these mini goods.

I met entrepreneurs we're designing new battery temistries that were low cost and durable and work better in tropical fundments. I could go on and on. I mean, people developing auto rickshaws that are electric based that would serve as sources of demand for this vision of the future. I mean, this is this is what you should My my nine year old and my eleven year old daughter yesterday told me. I said, what do you want to do with your life? To them, I don't know if I can, but I

want to solve climate change. And I was like wow, And then I said you can. You could be part of it. So I would say everyone can be part of a Governments have a huge role to play, frankly, both in getting out of the way and creating an environment that enables commercial enterprise to be successful here and in really committing itself to addressing inequity in the context of the COVID recovery and in a measurable and effective manner. And that's true, not just in India or Africa, but

in the United States and everyone. I'm glad you mentioned government's role because I do wonder. I mean, we talk a lot about public private partnerships, but you really do need that to get this done right, and you do need some kind of cooperation here on a grand scale. Yeah,

and you need government to set the right tone. So I think there's like, for example, if in the United States, if if our nation embarks on a multi trillion dollar green infrastructure investment program to create jobs and support job creation through the COVID recovery, that sets a tone, and that tone, in my view, should be extended globally and and should be about using the COVID nineteen crisis to build a global economy that is safe from a climate

perspective and inclusive from a development perspective. And it's achievable. And what what's so extraordinary is in normal times you would say, gosh, that's great idea, but you know these are normal times, and that's not how things work, right, not in normal times. We're in extraordinary times. We've put trillions of dollars already into fiscal and monetary policy solutions to just deal with the immediate symptoms of the COVID nineteen crisis, not even to think about the recovery. There's

nothing normal about this moment. This is probably the best chance we'll ever have to rethink the global economy. All right, So let's go where we started. Just to wrap up our conversation. The theme of this event is all about economic resiliency. I mean, that's the end game in terms of what you're trying to do, you know, give people a better life, right and and really have kind of a future to look forward too. Yeah, I I couldn't

agree more. I think the basic idea that everyone should have, uh, you know, universal opportunity is an appropriate guide post for shaping our future. And to do that in a manner that is green and protective of our climate is really the only way we could achieve that. And the great news is, you know, people have never been more innovative and more capable from the perspective of science and technology influencing the world around them, and crisis has always asked

us to reshape our societies. We just have to stand up and really take advantage of this one. All right. Just I do have one last question. So five years, where do you think of all of this falls into place in terms of your commitment, and everybody else gets involved. What could this mean for these million people, or at least a portion of them. Yeah, I think you can

see progress very very quickly. We we what we've seen with our customers from these programs, not just in India but in Myanmar and Africa and parts of Puerto Rico is the people react very quickly. Um. You know, you start giving people access to modern economic infrastructure, always on reliable,

affordable electricity, and what do they do? They do? Thinks they start businesses, They hire people that I'm at a carpenter who said, now that I know the power is going to be on, I bought power tools, which makes sense. And now I have power tools, I can make more furniture and I'm hiring more people. It just happens naturally. So five years from now, I'd like to see to three million of the of the eight hundred million target have already moved out of poverty or at least close

on that path. And in doing so, I hope that great movement creates the sort of positive feedback loop and inspiration to allow politicians, investors, leaders and young people to say Hey, we can get all the way there together. That was the president of the Rockefeller Foundation. Dr Rajiv Shah. You've been listening to Bloomberg Business Week Extra. Be sure to listen to Bloomberg Business Week Radio aeron live Monday through Friday at two pm Wall Street Time. On Bloomberg Radio.

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