You can clap your hands and smile, but if you're angry, they know you'll be in the Gulag tomorrow morning. And if we allow the emergence of such total surveillance regimes, don't think that the rich and powerful in places like Davos will be safe. I'm the chairman of Bayland Company and welcome to this session on how to survive the 21st century. It's not a new topic, but it's really getting urgent. 18 years ago, Martin Rees Britain's astronomer Royal published a book on the topic. He gave civilization a 50-50 chance of surviving the 21st century. Today, he says his concern have only grown. He cites new technologies and environmental catastrophe as the reasons. Well, don't yell at me, I want the technician. Can you hear me now? Okay, should I repeat what I said? Sorry, guys. Well, first I introduce myself. I'm Marie Gadish. The order there is a little misleading. I'm the chairman of Bayland Company and I welcome you to this session on how to survive the 21st century. I started by saying that this is not a new topic and mentioned that 18 years ago, Martin Rees Britain's astronomer Royal published a book on the topic. And he gave civilization a 50-50 chance of surviving the 21st century. He published another book this year, or actually last year, and his concerns have only grown. He cited technology and environmental catastrophe as the reasons. Now, being over 30, it is highly unlikely that I will survive the 21st century. And some days, especially when I hear about the fires in Australia, or here we get another example of our data being used to manipulate us surreptitiously, I find myself kind of glad of that, but I fear that the next generations may live to see horrific things. But perhaps not, especially if we start to really get serious about the existential issues that are coming now into plain sight. With us today is Yvonne Nohr Harari. He's the best-selling author of three books, the latest is 21 Lessons for 21st Century. He's a historian and a philosopher. He has thought long and hard about three existential challenges. Nuclear war, ecological collapse, and technological disruption. Also with us is Mark Rutte, also an historian. He's been the Prime Minister of the Netherlands for 10 years. In 2019, the World Economic Forum Competitives report ranked the Netherlands as fourth globally and first in Europe. It's a pretty good report card for a nation with some real challenges that are relevant to the topic we're going to be talking about today. As many of you know, about a third of the country is below sea level. The Dutch are famous for their dykes. And they're also famous for the little boy who plugged the leak in one of those dykes until help arrived. There are not enough little boys to just plug the threats that surround us today. But perhaps we can learn something from such devotion to a common good, which this is what it betrayed. To kick things off, Yvonne is going to share some of his current thoughts. Thank you. So hello everyone. I hope you hear me okay. If not, just make a sign. As we enter the third decade of the 21st century, humanity faces so many issues and questions that it's really hard to know what to focus on. So I would like to use the next 20 minutes to help us focus on all the different issues we face. Three problems pose existential challenges to our species. These three existential challenges are nuclear war, ecological collapse and technological disruption. We should focus on them. Now, nuclear war and ecological collapse are already familiar threats. So let me spend some time explaining the less familiar threat posed by technological disruption. In Davos, we hear so much about the enormous promises of technology. And these promises are certainly real, but technology might also disrupt human society and the very meaning of human life in numerous ways, ranging from the creation of a global useless class to the rise of data colonialism and of digital dictatorships. First, we might face upheavals on the social and economic level. Automation will soon eliminate millions upon millions of jobs. And while new jobs will certainly be created, it is unclear whether people will be able to learn the necessary new skills fast enough.  Now, there are new jobs in designing software or in teaching yoga to engineers. But how does a 50-year-old truck driver reinvent himself or herself as a software engineer or as a yoga teacher? And people will have to do it not just once, but again and again throughout their lives because the automation revolution will not be a single watershed event following which the job market will settle down into some new equilibrium. Rather, it will be a cascade of ever bigger disruptions because AI is nowhere near its full potential. All jobs will disappear, new jobs will emerge, but then the new jobs will rapidly change and vanish. Whereas in the past, humans had to struggle against exploitation. In the 21st century, the really big struggle will be against irrelevance. And it's much worse to be irrelevant than to be exploited. Those who fail in the struggle against irrelevance would constitute a new useless class. People who are useless, not from the viewpoint of their friends and family, of course, but useless from the viewpoint of the economic and political system. And this useless class will be separated by an ever-growing gap from the ever-more powerful elite. The AI revolution might create unprecedented inequality, not just between classes, but also between countries. In the 19th century, a few countries like Britain and Japan industrialized first, and they went on to conquer and exploit most of the world. If we aren't careful, the same thing will happen in the 21st century with AI. We are already in the midst of an AIR race, with China and the USA leading the race, and most countries being left far, far behind. Unless we take action to distribute the benefit and power of AI between all humans, AI will likely create immense wealth in a few high-tech hubs, while other countries will either go bankrupt or will become exploited data colonies. Now, we aren't talking about a science fiction scenario of robots rebelling against humans. We are talking about far more primitive AI, which is nevertheless enough to disrupt the global balance. Just think what will happen to developing economies once it is cheaper to produce textiles or cars in California than in Mexico.  Will it still be an independent country, or will it become a data colony? When you have enough data, you don't need to send soldiers in order to control a country. Alongside inequality, the other major danger we face is the rise of digital dictatorships that will monitor everyone all the time. This danger can be stated in the form of a simple equation, which I think might be the defining equation of life in the 21st century. b times c times d equals r, which means biological knowledge multiplied by computing power multiplied by data equals the ability to hack humans, r. If you know enough biology and you have enough computing power and data, you can hack my body and my brain and my life, and you can understand me better than I understand myself.  You know more about me than I know about myself. And you can do that not just to me, but to everyone. A system that understands us better than we understand ourselves can predict our feelings and decisions, can manipulate our feelings and decisions, and can ultimately make decisions for us. Now, in the past, many tyrants and governments wanted to do it, but nobody understood biology well enough and nobody had enough computing power and data to hack millions of people. Neither the Gestapo nor the KGB could do it. But soon, at least some corporations and governments will be able to systematically hack all the people. We humans should get used to the idea that we are no longer mysterious souls. We are now hackable animals. That's what we are. The power to hack human beings can of course be used for good purposes, like providing much better healthcare. But if this power falls into the hands of a 21st century Stalin, the result will be the worst totalitarian regime in human history, and we already have a number of applicants for the job of 21st century Stalin.   You can clap your hands and smile, but if you're angry, they know you'll be in the gulag tomorrow morning. And if we allow the emergence of such total surveillance regimes, don't think that the rich and powerful in places like Davos will be safe. Just ask Jeff Bezos. In Stalin's USSR, the state monitored members of the communist elite more than anyone else. The same will be true of future total surveillance regimes. The higher you are in the hierarchy, the more closely you will be watched.  So it's in the interest of all humans, including the elites, to prevent the rise of such digital dictatorships. And in the meantime, if you get a suspicious WhatsApp message from some prince, don't open it. Even if we indeed prevent the establishment of digital dictatorships, the ability to hack humans might still undermine the very meaning of human freedom. Because as humans will rely on AI to make more and more decisions for us, authority will shift from humans to algorithms. And this is already happening. Already today, billions of people trust the Facebook algorithm to tell us what is new. The Google algorithm tells us what is true. Netflix tells us what to watch. And the Amazon and Alibaba algorithms tell us what to buy. In the not-so-decent future, similar algorithms might tell us where to work and whom to marry and also decide whether to hire us for a job, whether to give us a loan, and whether the central bank should raise the interest rate. And if you ask why, you will not be given a loan or why the bank didn't raise the interest rate. The answer will always be the same because the computer says no. And since the limited human brain lacks sufficient biological knowledge, computing power and data, humans will simply not be able to understand the computer's decisions. So even in supposedly free countries, humans are likely to lose control over our own lives and also lose the ability to understand public policy. Already now, how many humans really understand the financial system? Maybe one percent to be very generous. In a couple of decades, the number of humans capable of understanding the financial system will be exactly zero. Now, we humans are used to thinking about life as a drama of decision-making. What will be the meaning of human life when most decisions are taken by algorithms?  The usual bargain between philosophers and politicians is that philosophers have a lot of fanciful ideas and politicians patiently explain that they lack the means to implement these ideas. Now we are in an opposite situation. We are facing philosophical bankruptcy. The twin revolutions of infotech and biotech are now giving politicians and business people the means to create heaven or hell, but the philosophers are having trouble conceptualizing what the new heaven and the new hell will look like. And that's a very dangerous situation. If we fail to conceptualize the new heaven quickly enough, we might be easily misled by naive utopias. And if we fail to conceptualize the new hell quickly enough, we might find ourselves entrapped there with no way out. Finally, technology might disrupt not just our economy and politics and philosophy, but also our biology. In the coming decades, AI and biotechnology will give us godlike abilities to re-engineer life and even to create completely new life forms. After four billion years of organic life shaped by natural selection, we are about to enter a new era of inorganic life shaped by intelligent design. Our intelligent design is going to be the new driving force of the evolution of life. And in using our new divine powers of creation, we might make mistakes on a cosmic scale. In particular, governments, corporations and armies are likely to use technology to enhance human skills that they need, like intelligence and discipline, while neglecting other human skills, like compassion, artistic sensitivity, and spirituality. The result might be a race of humans who are very intelligent and very disciplined, but lack compassion, lack artistic sensitivity, and lack spiritual depth. Of course, this is not a prophecy. These are just possibilities. Technology is never deterministic. In the 20th century, people used industrial technology to build very different kinds of societies, fascist dictatorships, communist regimes, liberal democracies. The same thing will happen in the 21st century. AI and biotech will certainly transform the world, but we can use them to create very different kinds of societies. And if you are afraid of some of the possibilities I've mentioned, you can still do something about it. But to do something effective, we need global cooperation. All the three existential challenges we face are global problems that demand global solutions. Whenever any leader says something like, my country first, we should remind that leader that no nation can prevent nuclear war or stop ecological collapse by itself. And no nation can regulate AI and bioengineering by itself. Almost every country will say, hey, we don't want to develop killer robots or to genetically engineer human babies. We are the good guys. But we can't trust our rivals not to do it. So we must do it first. If we allow such an arms race to develop in fields like AI and bioengineering, it doesn't really matter who wins the arms race.  Unfortunately, just when global cooperation is more needed than ever before, some of the most powerful leaders and countries in the world are now deliberately undermining global cooperation. Leaders like the US president tell us that there is an inherent contradiction between nationalism and globalism, and that we should choose nationalism and reject globalism. But this is a dangerous mistake. There is no contradiction between nationalism and globalism because nationalism isn't about hating foreigners. nationalism is about loving your compatriots. And in the 21st century, in order to protect the safety and the future of your compatriots, you must cooperate with foreigners. So in the 21st century, sorry, good nationalists must be also globalists. Now, globalism doesn't mean establishing a global government, abandoning all national traditions, or opening the border to unlimited immigration. Rather, globalism means a commitment to some global rules, rules that don't deny the uniqueness of each nation, but only regulate relations between nations. And a good model is the football World Cup. The World Cup is a competition between nations, and people often show fierce loyalty to their national team. But at the same time, the World Cup is also an amazing display of global harmony. France can't play football against Croatia unless the French and Croatians agree on the same rules for the game. And that's globalism in action. If you like the World Cup, you're already a globalist. Now, hopefully, nations could agree on global rules, not just for football, but also for how to prevent ecological collapse, how to regulate dangerous technologies, and how to reduce global inequality. How to make sure, for example, that AI benefits Mexican textile workers and not only American software engineers. Now, of course, this is going to be much more difficult than football, but not impossible. Because the impossible, well, we have already accomplished the impossible. We have already escaped the violent jungle in which we humans have lived throughout history. For thousands of years, humans lived under the law of the jungle in a condition of only present war. The law of the jungle said that for every two nearby countries, there is a plausible scenario that they will go to war against each other next year. Under this law, peace meant only the temporary absence of war. When there was peace between, say, Athens and Sparta, or France and Germany, it meant that now they are not at war, but next year they might be. And for thousands of years, people had assumed that it was impossible to escape this law. But in the last few decades, humanity has managed to do the impossible, to break the law, and to escape the jungle. We have built the rule-based liberal global order that, despite many imperfections, has nevertheless created the most prosperous and most peaceful era in human history. The very meaning of the word peace has changed. Peace no longer means just the temporary absence of war. Peace now means the implosability of war. There are many countries in the world which you simply cannot imagine going to war against each other next year, like France and Germany. There still was in some parts of the world, I come from the Middle East, so believe me, I know this perfectly well. But it shouldn't blind us to the overall global picture. We are now living in a world in which war kills fewer people than suicide, and gunpowder is far less dangerous to your life than sugar. Most countries, with some notable exceptions like Russia, don't even fantasize about conquering and annexing their neighbors, which is why most countries can afford to spend maybe just about 2% of their GDP on defense, while spending far, far more on education and healthcare. This is not a jungle. Unfortunately we have gotten so used to this wonderful situation that we take it for granted and we are therefore becoming extremely careless. Instead of doing everything we can to strengthen the fragile global order, countries neglect it and even deliberately undermine it. The global order is now like a house that everybody inhabits and nobody repairs. It can hold on for a few more years, but if we continue like this, it will collapse and we will find ourselves back in the jungle of omnipresent war. We've forgotten what it's like, but believe me, as a historian, you don't want to go back there. It's far, far worse than you imagine. Yes, our species has evolved in that jungle and lived and even prospered there for thousands of years. But if we return there now with the powerful new technologies of the 21st century, our species will probably annihilate itself. Of course, even if we disappear, it will not be the end of the world. Something will survive us. Perhaps the rats will eventually take over and rebuild civilization. Perhaps then the rats will learn from our mistakes. But I very much hope that we can rely on the leaders assembled here and not on the rats. Thank you. Thank you, Yuval. That was very thought-provoking and challenging introduction and pretty frightening. Let's hope the rats don't get the upper hand. And with that in mind, let me turn to you, Prime Minister. We're head of a government responsible for the well-being of millions of people. And in 2019 alone, you have signed multi-partner strategic agreements in both climates and NAI. And then also, you're one of the leaders of the EU, which is the first organization to think really about data and privacy and to come out with this bold green initiative based not on scaring people, but really as a strategy for growth. What's your take on this on the road ahead? Well, thank you, and I'll first of all say I'm slightly more optimistic, but I'm the eternal optimist in the room always. But here I'm slightly more optimistic because I believe there is a strategic, but also a societal and economic imperative, let's say an urgency to make sure that we don't be at artificial intelligence or be at this big issue of climate change that we get a grip on it. But I will also briefly address some of the big issues just being mentioned because of course they are rightly mentioned and we have to mitigate them. But first, very briefly, why is this fierce urgency of now on artificial intelligence and on climate change? On climate change, because of course we want to mitigate the warming of our world and address the CO2 emissions, that's clear, but at the same time there is a huge economic possibility here, lots of new jobs being created. I see this in my country, where we see now growing investments because of the energy transition and climate change itself, but of course you need therefore a strategy. You need society to be on board. We, in the best Dutch way, had everybody on board this debate, as you mentioned, created a big climate agreement in June last year, which we are now implementing, which is affordable and achievable, but which also creates the jobs necessary in the future. I believe the same is true for artificial intelligence. The possibilities this will present, in terms for example of cancer research, in terms of, for example, being able to have precision farming with a smaller CO2 footprint at the moment, autonomous driving, energy transition itself. In all these areas we need artificial intelligence. I believe it is a more, a bigger transformation than the invention of the internet itself, if we do it right, because things can go horribly wrong. That means also we have to focus when it comes to climate change on climate adaptation. We will host an October next this year, the big climate adaptation summit, being one third of the country being below sea level. We need to do this, as we always say, God created the earth, the Dutch created the Netherlands. So we want to showcase this to the world how to work on climate adaptation. In terms of artificial intelligence, of course it is crucial that we change the educational system. It has to adapt to what is happening in the area of artificial intelligence. We need to have the European human-centric approach leading us here. That I think is crucial. And standards, for example, in terms of data and privacy is very important here. And then I come to the big issues being addressed, very briefly. One, yes, we have to stay anchored in a non-ilateral global world system. But then it doesn't help to constantly beat Trump. Not that you were doing this, but I know that during the Davos sessions we like to beat Trump. It doesn't help at all. He is President of the United States. I believe that he rightly addresses some of the big issues in terms of the function of the UN, NATO, the WTO. So let's make use of the fact that he is President of the United States to change these global organizations, because you're right. We can never deal with these issues in bilateral ways. The strongman, Trump, Erdogan, Umbos Naro, Xi Jinping, they cannot in a bilateral way, in a traditional way, deal with the global issues. Secondly, I want to ask attention to the role of the free press. There is a risk that with Facebook and all the other big companies who are drawing all the advertising money into the internet now that it is running against the traditional newspapers and the traditional news outlets. But we need journalism to be able, for example, we have all seen this small clip with Obama saying very strange stuff, which was a created clip. But when you see it, it seems like it is really Barack Obama. Imagine that this clip would be aired on television one or two days before the election, with some of the national politicians being in that small clip on the internet or on television. That might have a huge impact on election outcomes. So you need to free press at these moments to be able to explain to the people what is really happening. But that costs money. So one of the things I have with big business here in Davos, don't put all your money in the internet advertising. Make sure that our newspapers, our news outlets, also our TV stations, also in the future will be able to pay sensible and real salaries to our journalists to be able to do this. I believe it is crucial. And finally, I think what will help here, of course, is when you have a established democracy. Because in an established democracy with multi-party systems, that in itself will create a tradition in your society of debating all the various issues and views, et cetera. And that is to the core of what we as human beings are. We like to debate. And you come from Israel. Israel is one big debating society. And most of our established democracies are thrive on debate, thrive on opposing views.  So an established democracy will be very helpful here. And that's why I'm so motivated to keep that running in the Netherlands. That was optimistic, but not optimistic enough for me. So let me throw a question in here for both of you. Completely support free press. I agree that innovation has done a lot for health care and a lot of other things and democracy. But technology is still marching on. And I was reminded when Yuval was talking of, I mentioned to Yuval before, of two books that were written the first half of the 20th century that kind of predicted humanity's future. One was George Orwell's 1984, where the population was controlled by this fearsome dictatorship. And surveillance was everywhere. The thought police was going after, they knew what you were thinking and they were gonna persecute you. And that's kind of like the digital dictatorship that Yuval talked about. The other book, which in some ways is more scary, is Huxley's Brave New World. Where by contrast, the population is bred or programmed to want what the world state is willing to provide them. So they buy what the algorithm tells them that they should want. They do what the algorithm tells them they should be happy doing. In a way, it's this naive utopia that you talked about. Neither author, by the way, mentioned algorithms because the word as it exists now the current use didn't exist. But unlike the book's protagonist, we do know that we're being manipulated. You mentioned that when you said why we need to repress. Yuval mentioned that when he talked about where we are with algorithms. And the question is really whether we would, whether we're gonna let this continue. So it should be, for example, demand that all algorithms that make or influence decisions are a matter of public record or at least subject to some regulator who actually can unmask at least or understand how they're working and explain it to some people. But who is controlling the regulator?  Oh, but you tell me, we have to go there. In the end, maybe, just briefly, I believe that in the end, you want the people in your country to be the regulators, collectively. Take 1984, we have. But you are a global regulator that then lets countries decide how to do that. In terms of regulating artificial intelligence to make sure that privacy is protected, that data is protected. Yes, I agree, you need regulation there. And at the moment that is going on to make sure that, for example, Europe, European Union is the biggest data mine in the whole world. And everybody would like to mine that data. So it is crucial that you have regulation in place. But at the end, the strongest regulation is independent thinking, people, and all classes of society. And that is at the core of our societal system.  And we know that even in 19th century in magazines, you would find advertising geared to your particular preferences. That is not too different from what is happening nowadays in algorithms on the internet. Of course, it was all fashioned, but trying to somehow be able to channel your message to a particular audience is not different from what happened in the traditional media in the 19th and 20th century, advertising whatever. What you don't want is things like Cambridge Analytical, that there was this impression that what you were doing in the internet on Facebook was basically being geared to certain messages given to you, which would then almost conjure you to vote in favor or against the Brexit referendum or whatever. I think in reality it was not that sophisticated if you sometimes think, but of course these risks are there. So you need some form of regulation. But in the end, let's not be too scary about this because if we start to regulate this too heavily, then it will immediately pose the question who is controlling the regulator because that man or woman will have a lot of power.   And what we saw in the 2016 elections with the Cambridge Analytica, that's nothing. I mean, we still haven't passed the crucial watershed. The real watershed is the union of AI with biometrics. At present, still the vast majority of data being mined and people being hacked, it's not based on bi-biological knowledge, on bi-biological data. It's based on where I click, where I go, what I buy, and things like that. It's still outside the body. The real line in the sand is when biometric sensors become ubiquitous and it's happening and the data starts coming from within the body and they can access your heart, your brain, not just your credit card. And AI is no near its full capacity. It's going to get much, much more sophisticated. So it's going to also be much more difficult to regulate it, especially because even if like the European Union, you have a law saying that if an algorithm makes a decision about me, like not hiring me for a job, I have the right to know why, which is very crucial. But to me, it seems completely ineffectual because the way algorithms make decisions about us is based on enormous amounts of data points. When a human decides not to hire me for a job, it's usually based on two, three salient data points and I can understand why.  Hey, that's discrimination, you can't do that, that's easy. But an algorithm, the big thing about big data and AI, you take thousands, tens of thousands of data points, each contributing a very small percentage and that's how it makes decisions. Now, I can have the right to get all the information so they'll give me a big book of a thousand pages with lots of numbers. This is why the algorithm didn't hire for a job. But you won't understand. Why do I do with that? So the thing is, the way the decisions are being made in the world is going to change. Algorithms make decisions in a different way than humans. Let me take it from here. I acknowledge what both of you said and pick it right up from here. You're both historians and history is littered with empires and worlds that sort of looked back and said, if only we would have done that at that moment, the world would have looked different now. I think we are at that moment. I don't think, we're talking about the things we want, we talk about multilateralism, but there are countries who tell us that they don't actually want to cooperate on the standards of the world. There are people who will tell us that I don't want to change the way I make profits and there is no regulator right now doing that. So this might be the moment in time where you need to think, well, we know that people start to cooperate when they face a common enemy. And my question to both of you from slightly different points of view, how do we get a real or perceived common enemy out of those real challenges that face us? And Yvonne, you talk a lot about the fictions that unite people and religions and nations. You travel the world, let me ask you first and then you, Prime Minister. So with nuclear war and ecological collapse, it's relatively easy because it's obviously a threat to everybody. Nobody's going to win a nuclear war. But with technological disruption, it's much more difficult because there are a lot of some people, corporations and governments think, and with some good reason, that they can win an AI arms race and they can control the world economy or the world political system with that. So it's much more difficult to convince them that everybody is on the same side. And the really central issue is inequality. I'm not so worried about a country like the Netherlands. I think you'll be okay. I'm much more worried about countries like Venezuela, about Brazil, about India, about Indonesia. What will they be in 30, 50 years? I mean, I mentioned the analogy with the Industrial Revolution of the 19th century when a few countries dominated and exploited everybody else, it could be much, much worse in the 21st century if you have just a few countries that dominate the new divine powers of AI and biotechnology. And even if you think about the Netherlands and Europe, Europe is hardly in the race. At present, at least with AI, it's really China versus the U.S. And neither is a very good option as far as we can tell. I mean, the U.S. at least until a few years ago at least said that it wants to be the leader of the world and to work for the benefit of everybody. Now it resigned its role of leader of the world and it openly says, we don't care about anybody except ourselves. And that's not a leader. You don't follow a leader whose motto is, me first. So I think there is an opportunity here. I think the opportunity is a wake-up call, especially for Europe, that you can't rely on the U.S. anymore and you should be maybe a third independent way. But as things look in 2020 from the big 20 tech companies in the world, I don't think that any is European. Let me actually give a word for Europe. So I'll share the burden from a business point of view, which I've been asked to do as well. A very important part in what's going to be going on is the way actually decisions are being made about technology, where it's bought and how it gets used. And while the U.S. and China have the big platforms that people talk about, the technology companies, Europe actually is quite unique relative to the United States. It has 5G, people who can still actually make 5G working. Now, in America, there isn't a single company that can do it today. And the reason for that is because when mobile started, the United States went a different direction. Europe agreed on a single format and they went down the experience curve, both cost-wise and quality-wise. All the United States companies were sold to Europeans or disappeared. Europeans are consolidated now. There's now China, Korea and Europe. That is an opportunity for Europe, in my mind, to actually take a step in technology, make a huge difference because when you think about the future, those who control 5G or make 5G will actually control all the infrastructure on which the technology that we're talking about is going to be. Well, I'm not as negative about America as some of you in this room because I still believe America is the leader of the free world and I cannot envisage any big global issue being solved without the involvement of the USA. Despite who is president, not important. At the end, that is still the case. But at the same time, the European Union is one and a half times bigger in its overall size of economy than the US and three or four times bigger than China. So when they are fighting each other, the US and China, it's not about first place, it's about second place. So let's not forget it. And you're right, the European Union has many and the European countries have many other advantages. And I'd also agree when talking about AI and particularly when you see what will happen as you put very clearly in your presentation and the risk be involved. You need that regulation, including transparency and how to have worldwide standards about transparency that at least you understand that because of the color of your skin or whatever you have been rejected for that job and that you don't have to go through a hundred pages of digital data. So you need that clearly decipherable worldwide standards on transparency. That's crucial. And we need the involvement of companies to help us to create that. At the end of this political system it says to take the decision but you need the technological input. But I'm very optimistic about European countries being able to do this. In the Netherlands we have this AI strategy we're working with all the big tech companies worldwide to build AI clusters in the Netherlands because we know that if we want to stay the fourth most competitive economy in the world and number one in Europe, this is crucial because this is transformational. So yes, we have to acknowledge the risks and the downsides of these new technologies. But at the same time for our societies to come along let's also acknowledge the enormous amount of good this can create in terms of our health, cancer, many things I mentioned earlier because I'm extremely optimistic about what that can do if you're not naive. I agree with you on that point and that includes working on global standards that includes maintaining the liberal international world order but then including making changes to the big global organization where at this moment are in many cases not functioning as they should. Well, we have less than one minute and I'm supposed to summarize this. So let me actually think I think we have participated and seen a discussion between a philosopher and a political leader trying to conceptualize a little further what the 21st century might look like. There was a little bit of pessimism, a little bit of optimism. I think a lot of realism as one starts to think about where to take that next and it's important to talk about those things and to realize them. So please join me in thanking both speakers for today's exhibition. And.


Good afternoon all, what? Thank you. More than religion, more than politics, more than sports, what's that one question that unites us all? It's a very simple question. Where the hell is my package, right? We have all always waited for one or the other delivery packages for us. Logistics is one of the most underrated issues in our modern world. If you think about it, the number of people who are hungry every day in the world multiplied by the amount of food they need to take every day is less than the amount of food wasted every day, which basically means world hunger is a distribution issue, not a production issue. So why is logistics that complicated, right? Let's have a look through the journey of a package from any point A in the world to any point B, right? What happens at each stage? Let's just dive open each point of the package, right? So let's say when you place an order, some of the issues that the logistics companies face at that point are that they do not know the size of the package that you are placing an order because that information is only with you. They don't know when they should be picking it up because you may not be at home, you may be available, do you want a convenient pickup time? And that adds just to a lot of variability, right? Do you know, by the way, who makes it so complex? It's all of us. 20 years back, all of us, by that I mean the consumers were never part of the supply chain story. You used to drop a package to some FedEx port and you used to buy something at a retail store. Today, you wanted to be picked from your home and office and your goods to be delivered back to your home and office. This creates a level of complexity absolutely unseen before in logistics, right? So consumer becomes a part of the supply chain and all of these problems comes just at the beginning. Then when it goes to a warehouse, all the packages from all of your homes are collected together, they go to a warehouse at the end and at that warehouse, now you have another set of issues, right? What are they?  And this becomes an immensely complex problem. Second, now a typical company will have a few hundred distribution centers. What's happening at each distribution center? Now, each distribution center does not work in isolation. It's exactly like a stock market. The performance of one's thing in one sector will affect the stock price across the sector, right? So can the movement at any one point of distribution completely change the flow at another point? And how do you know that when you don't even have that kind of visibility? And then, even if you resolve that, every single minute that a package is delayed, it's not just the transportation cost that's drastically increasing, it's the storage cost. Storage contributes to between 40 to 60% of the cost that is required at any point in any logistics movement, right? So every time you delay shipping out a package from a warehouse, you are effectively increasing its storage cost. Now, let's say package made through all this journey, fought through the complexities at the first mile at the warehouse, now comes the most difficult part of the logistics, the last mile. That is, that is the package actually reaching the intended destination. It has several issues. Now, of course, the first issue that we have always faced is the timely delivery of our packages, right? Now, if I get an SMS in the morning saying, hey, my package is out for delivery, that's not really useful. Do I go to my office? Do I not go to my office? Do I go pick up my breakfast when I got to be at home? When the package comes, what do I do about it? Second, the dispute in businesses that, hey, has the package been delivered? If it has been delivered, has it been delivered in good condition? And when, if you want to see how complex this issue is, you should really go to a warehouse of a third party logistics company. You'll be surprised to know that as much as storage they have for packages, they have storage for a bunch of papers reconciling the proof of deliveries across the supply chain. And then finally, you have, can we deliver the package in the first attempt? Because when you make multiple attempts to deliver a package, it's not just the inefficiency. There is a social cost that comes in. Is, think about it, is that $3 connector that you ordered from Amazon worth making three attempts to deliver at your home, the social cost of it, the pollution cost of it, the carbon footprint of it. So it's not just about the efficiency, it's about being responsible. You want to do it right the first time. So these are the complexities that, you know, that logistics faces at each stage, the first mile, the middle mile, and then the last mile. But then the question is, are we here to just describe the problems? Absolutely not. We're here to talk about how can we bring a bit of magic in motion in the entire logistics piece. Now, what do I mean by magic in motion? Well, think about it this way. Can all of you tell me what is this? Of course, you can tell me it's in hand. Can you take out your phone and tell me by reverse, doing a reverse video search? Absolutely not. Because figuring out what is there on screen is a problem of visual cognition that is suited for humans. But if you think about it, your supply chain, as we just described, is a bunch of fast moving variables. It's nothing but a multi objective, multi variable meta heriostake optimization problem, exactly like a stock market. It was designed to be algorithmized. And with the recent advent in data technology, the map data sets available to us, we can algorithmize this entire decision making. So the question is, can we automate every single piece of decision making that is required to transport a package or a person from any point A to any point B? No human decision making involved in it. And if you do that, let's look at how the sum of the advantages we gain at each of these steps. Let's go back to our first mile, right, where we talked about the pickups, right? Now let's see if you can do. So if you create an IoT device, which instead of scanning just a barcode, also measures the length, breadth height right at the point of shipment. Now you have introduced that digital information, which makes the whole planning piece effective. And towards this, Locus has built its own handled hardware that instead of just scanning a barcode, also measures the length, breadth height. So you start digitizing at the very start. Second is your dynamic planning. Instead of instead of telling the consumer, hey, I'm going to come in the second hour to pick your order when the consumer may not or may not be there, ask the consumer, when should I come for a pickup?  Can we give like, you know, as precise information as, hey, I'm going to pick it up in this one hour slot that you select. And that drastically, you know, reduces the friction required in just the order collection before it even reaches a warehouse. Now let's see what happens at a warehouse. At a warehouse.  And this should not be just based on experience, but in 2000 should be based on data. You can run a sensitivity analysis. You can run a bunch of simulations. And this is today possible because of the advancement in data, machine learning, optimization techniques, and as of last year, deep learning methods, which allow you to learn a lot from unstructured data and generalize it. Second, there are, thank you. That's good logistics. So second, if you had each point in your supply chain, you have the relevant hardware that can that can tell you what is the visibility. Because let's remember, yes, we want to answer the question where the truck should be. But to answer the question where the truck should be, it's very important to know where the truck is, right? So the first step to automated decision making is visibility and transparency. And that gets bring in with a large IoT and sensor networks. Previously, you could have been collecting this data, but we just did not have methods to process this into meaningful and useful insights. Third, cost modeling and optimization, right? Countries have double digit percentage cost of their entire GDP as a piece of logistics. A small, a few basis point movement in the cost of logistics as a percentage of your GDP can change the fortunes of the company. As I mentioned, there is a first principle reason of this problem to be solved by computers. Because as I said, all of you can recognize what is this, but can you tell me what is two to the power 98? No, while a $3 computer can. Logistics is a problem designed to be solved by computers. If you feed the right amount of data in it, have the most amount of propriety algorithms, which constantly adapt to your business, you can you can bring cost optimization and modeling to a double digit percentages. We work with public market enterprises throughout the world who have been running logistics businesses for a decade based on experience. And simply because of the newer algorithms, they have been able to reduce their logistics cost almost between 15 to 23 percent. And these are large public market companies. It's not that we are doing some magic. We believe we are, but it's simply this problem was always designed to be solved by computers. And now we have just dedicated an exceptional unit to 20 percent of my entire team is PhDs from various schools like Carnegie Mellon, Columbia, Ohio. The founders were building the AWS machine learning network before this. So we have built large scale public machine learning systems along with having propriety algorithms, attacking a problem which was always designed to be solved by computers using the most recent available data set. These three combination just makes it an amazing problem to be solved by computers. And now finally at the last night, this is when your package is really available to you. Imagine a world where your courier company, instead of sending you an SMS, which says, Hey, I'm going to deliver your package today. It says, Hey, I'm going to deliver your package between four to six p.m. And at four 15 p.m. sends you another SMS with a tracking link where you can see your package coming live to you for the last half an hour reduces anxiety. You are available at the last point to actually receive your package removes the reduces the turnaround time for the company as well. Right. A simple signature for you, you know, on their tablet or via an OTP or via a simple picture makes the whole reconciliation very simple. It's not just electronic proof at that point. It also earlier you digitize the data in the supply chain lesser chances of it ever going into fraud. The third most optimal the third most important point now because today let's say this group of people ordered a package from Amazon tomorrow this group of people ordered groceries from OSIX in Japan. Now because consumers are split at different different points in a city and different consumers order different days. The traditional last 200 years of methods of dispatching logistics just don't work. Now you cannot have static routes going from each dispatch center based on everyday's demand. OSIX needs to calculate how many trucks to run to get your deliveries to your home every single day probably multiple times a day and that requires sophisticated routing engines but that gives us two things one it gives us efficient routing that means you're spending less to deliver your packages and second you're ensuring that your first attempt rate of deliveries are increased which effectively reduces your carbon footprint making us all a considerably responsible citizen. It is our firm belief that in very near future by 2025 there will be large companies whose chief supply chain officer will not be a human but will be a software. On that note as is our business we always deliver on time. Thank you.


I'm pleased to update Parliament today on the progress that Scotland is making in tackling climate change. Scotland's transition to a low-carbon economy is well under way. In 1990, Scotland emitted 76 million tonnes of carbon dioxide equivalent. Statistics published today show that in 2016 that number had almost halved to 39 million tonnes. That's a reduction of 49 per cent. Scotland continues to outperform the UK as a whole in delivering long-term emission reductions, and among Western European countries in the EU, 15 only Sweden has done better. This achievement has been a national endeavour requiring effort across the whole of Scotland in every community, home and organisation. Today's statistics are testament to everyone who has made changes to their personal or business behaviour. Those changes are making a real difference. In terms of how we are progressing against Scotland's current statutory targets under this Parliament's 2009 act, the statistics published this morning show that emissions are down 45 per cent. Those targets are set on an adjusted emissions basis, which reflects the operation of the EU emissions trading scheme in Scotland. On this basis, Scotland has not only met the 2016 annual target but is again exceeding the level of the current interim 2020 target of a 42 per cent reduction. Given that our existing statutory targets lie at the most ambitious end of current international pledges to 2030, and we are making sustained progress in meeting them, I am sure that you will agree with me that this is good news. However, there is always scope for improvement in the current reporting of climate targets. For this reason, the new climate change bill proposes that all future targets will be set and reported using actual emissions rather than the emissions adjusted for the EU emissions trading scheme. A further issue that members will recall from previous years is the technical revisions to the data that happens as measurement science evolves. Decisions about these data revisions are made at a UK level in line with UN guidelines. As has become customary, the statistics published today contain substantial revisions to the past data, mainly in the forestry sector. Those revisions have worked in our favour, effectively making targets relatively easier to meet than was the case last year. However, in most previous years revisions have gone the other way. They have made targets harder to meet, and overall the effective revisions to date has made those targets harder. That illustrates how important it is to ensure that target outcomes reflect on-the-ground actions and are not determined purely by technical changes. The new bill implements recommendations from the Committee on Climate Change on this issue. The measurement methods used for reporting target outcomes will be frozen from the time that the target levels were last reviewed. That will help to ensure that technical changes alone do not determine whether targets are met or indeed missed. Those shifts will improve transparency and enable government to be held to account, something that I know that Parliament is always keen to do. The statistics published this morning demonstrate that Scotland is halfway through its low-carbon transition. We must build on that momentum and the global consensus enshrined in the UN-Paris agreement and commit to doing even more. Through our climate change bill, we are not only providing solutions to our country's needs and interests, but also putting Scotland in the global vanguard. We are one of the first countries to set new statutory targets based on independent expert advice in line with the global aims of the Paris agreement. The bill will mean that Scotland has the world's most ambitious statutory 2050 target based on domestic actions alone. The interim targets for 2020, 2030 and 2040 will be the most ambitious statutory targets for those years anywhere in the world. Scotland will also remain the only country to have statutory annual targets, allowing Parliament to hold Governments to account each and every year. That means that there can be no delay to increasing action. There is no doubt that those new statistics demonstrate substantial and substantive progress, but they also show where we need to be mindful of consequences. Since 1990, energy supply emissions are down 69 per cent, and waste and industry have also seen substantial reductions. In particular, the closure of the Longannet power station in March 2016 has had a substantial impact. The move to low-carbon energy is the right one, but we must also reflect on those who were employed at Longannet. That shows very clearly that the low-carbon transition involves and will continue to involve very real impacts on people, jobs and local economies. There will be many co-benefits, but there will also be genuine challenges. That is why we need to take a balanced approach to meeting our climate, social and economic priorities. The transition to a low-carbon economy requires transformative change, but that change must always also be fair and inclusive. It is intended that the Just Transition Commission, which this Government will bring into being, will explore those admittedly difficult issues and advise on continuing the transition in a way that promotes cohesion and equality. The form that the commission will take and its membership are currently being considered and will be announced later this year. The emissions statistics also show where we need to make more progress, particularly transport and buildings. This Government is already focused on tackling those issues. The Switched On Scotland road map outlines plans to increase uptake of electric vehicles and Scotland is taking the lead in promoting the use of ultra-low-emission vehicles and phasing out the need for new petrol and diesel cars and vans by 2032. The route map for energy-efficient Scotland, which was published last month, sets out our vision that by 2040 all buildings in Scotland are warmer, greener and more efficient. Turning to the issue of net zero, let me be absolutely clear. This Government wants to achieve net zero emissions as soon as possible. Crucially, I want to get there through responsible, credible legislation, plans and action. We need to maintain Scotland's momentum because, without a doubt, the actions that are needed to reduce emissions in the future will be much tougher than those of previous decades. I do not want Scotland to just reduce its emissions. I want us to reduce emissions in a way that supports sustainable and inclusive growth and a fairer society. The transformation to a low-carbon economy must benefit all. Otherwise, it could commit Scotland to approaches that will reduce food production, limit connectivity and jeopardise jobs. That sort of dislocation would be neither responsible nor sustainable in the long term. I also believe that Scotland's transformation should be built upon the strengths of this Parliament's 2009 act. Setting a target beyond 90 per cent now would mean reducing the integrity of our approach, for example by purchasing international credits, removing sectors from our targets or relying on future technology that cannot be set out now for scrutiny. For those reasons, the bill supports our commitment to achieve net zero emissions as soon as possible but does not set a fixed date for that. The bill ensures that there is a requirement to have regard to the regular independent expert advice that will be provided on target levels, including the specific issue of a net zero date. As soon as the evidence indicates that there is a credible pathway to net zero, we will use the mechanisms in the bill to set the earliest achievable date in law. The moral, scientific and economic case for global action on climate change is clear and Scotland has risen to this challenge. The statistics published this morning clearly demonstrate the strong progress that Scotland continues to make in reducing greenhouse gas emissions. The actions to date are working, the commitments already made and in development will help to make further and faster progress. The proposals in this Government's climate change bill will help Scotland to remain a world leader on tackling climate change and enable Scotland to become a fair and just low-carbon society. Donald Cameron, to be followed by Claudia Beamish, is just under 20 minutes for questions. I thank the cabinet secretary for advance notice of our statement and also refer to renewable energy and agriculture in my register of interests.  We specifically welcomed the announcement of the Just Transition Commission. However, the publication of these statistics provides us with an opportunity to discuss broader issues surrounding climate change. It is important to acknowledge that, in many quarters, it has been felt that the climate change plan and the recently published bill are not robust or ambitious enough. Similarly, we note that, although significant progress has been made in bringing down emissions in energy production, there has been little movement in transport and residential emissions as, to be fair, the cabinet secretary recognises in her statement. However, those benches agree with Stop Climate Care Scotland, which says that we must use that opportunity to discuss what more we can do to tackle climate change. Therefore, I ask the cabinet secretary what more can be done to reduce emissions in areas such as transport, which is the largest emitting sector. Will the Government use that as an opportunity to strengthen the bill so that we can meet our climate change obligations? I thank Donald Cameron for his question. I have outlined in the statement why I believe that what we are proposing in relation to the climate change bill is ambitious. I acknowledge that sectors of the economy have not made the same strong level of progress as other sectors, but I do not suppose that any of that comes as an enormous surprise to anybody. What more can be done—I think that there is a great deal more that is already being done. I remind members in the chamber that those are the stats that relate to 2016. Since 2016, there have been some very considerable changes in terms of transport policy, huge commitments made and a lot of work currently being done on, for example, low-emission zones. Now, it is not my portfolio area of interest, but I know that a transport bill has just been published yesterday. I expect that there will be quite a vigorous debate within the context of that going through Parliament, which will relate to some of the things that we are talking about today. I believe that, in terms of transport, the Government has already made some significant commitments that will change the future in terms of transport emissions when we come to see the 2017 stats and the 2018 stats and the 2019 stats. I think that there is a tendency to forget that there is a two-year time lag in those stats. The same with buildings. There is a very big commitment made by the Government in terms of energy efficiency over a number of years, and that will begin to be reflected in future stats. There is a lot of work being done to increase the ambition, and it is likely to have a significant effect on emissions reductions precisely in the sectors in which we think that, at the moment, there is still a lot to do. Claudia Beamish will be followed by Mr Stewart Stevenson. I thank the cabinet secretary for his price at the statement, and I welcome the fact that we have met this year's targets. It is a complex picture, and this gives confidence in the possibilities of what Scotland can achieve when climate policy is driven by ambitious long-term and interim targets. Will the cabinet secretary look again at the claim that the draft bill's targets are the world's most ambitious as they stand at the moment? Much of the emissions reduction is from the deployment of renewables in the electricity sector, and I would like to know what lessons the cabinet secretary thinks we can learn from that, and how we can apply it to sectors in which emissions are not yet falling enough—transport, residential buildings and agriculture—which he does not highlight as one of the areas of concern in the statement. The Scottish Government could be considering, in our view, more robust policy to support farmers and mandatory action. Will the cabinet secretary commit today to dialogue with the cabinet secretary for the rural economy to address the issue? I thank Claudia Beamish for her question. I will not repeat what I have just said about transport and buildings. I do not see much purpose in just being repeating there. I am glad that the member raised the issue of agriculture, because one of the difficulties of agriculture is that most of the emissions in agriculture are not actually carbon emissions, but residual emissions such as methane. The tackling of those emissions is a very different matter than the decarbonising that takes place, for example in the energy sector that she referred to and wanted to use as an example. It is probably fair to say that we will decarbonise energy much sooner than we will be able to reduce emissions from agriculture, because the total reduction of emissions in agriculture would effectively be no food production. We cannot be in a position where that is what we are talking about. She can rest assured that I have vigorous conversations frequently with my colleague in the rural economy portfolio, but I understand and accept some of the challenges that are in the agriculture sector and will be in the future if we set targets that are far too high and unable to be achieved other than by reducing food production in Scotland, which in my view would not assist us either nationally or indeed globally. Stuart Stevenson, to be followed by Maurice Golden. I wonder if the cabinet secretary could outline her view on trade agreements after Brexit in the effect that they might have on our approach to climate change, especially with regard to the relatively recent departure of the United States from the Paris agreement, which suggests that the administration there has no interest in understanding of the effects of climate change. I could say that that is answered by Stuart Stevenson. It is the case that we may be in a situation post Brexit where trade agreements that the UK might arrive at are not ones that will help us in terms of reduction of emissions. We do not know what is going to happen. We are not certain what they will hold. They could end up leading to increased emissions from the goods and services that we import for, for example, the reason that Stuart Stevenson has alluded to. The truth is that membership of the EU and its single market provide Scotland with access to climate-friendly trade with our neighbouring countries, which I think that everybody would accept is the most sensible way to proceed. Maurice Golden, to be followed by Alex Rowley. Given the closure of Longannate, has the Scottish Government considered what impact the transition to a decarbonised energy supply might have in the event of a black-start event? I think that the reason that we are talking about the Just Transition Commission is because we want to make absolutely sure that what we are doing in all sectors, including the energy sector, does manage things for our population socially, economically and in terms of emissions reductions and targets. What the member is alluding to is the kind of thing that is almost impossible to factor into what the future might hold. That is why we have to be incredibly careful how we plan forward. I think that we have done incredibly well in terms of the energy sector, but the closure of Longannate shows a sort of microcosm of some of the things that can happen, and that can go wrong in the future. I am not saying that that was the wrong thing, but it is jobs, it is a local economy, it is an important aspect of how we plan for the future and the inability to have a 2024 site. We all wish that we could, but we do not. Alex Rowley, to follow on from that, the figures are the first to show the impact of Longannate closure. That is being good for our climate, but the only just transition support that the Scottish Government offered was at the moment of crisis for those workers and for those communities. Moving to lower emissions requires us to plan and support workers in the just transition stages, as the cabinet secretary has said. Does that not mean that we need a just transition commission that is long-term and with a powerful legal basis in the climate change bill, and that we also need an industrial strategy that takes us to a low carbon future in consultation with affected workers and communities across Scotland? The just transition commission will, when it is set up, provide the kind of conversation that the member, undoubtedly, as I do, thinks is absolutely necessary. Longannate is a case study of what might be required. The member is asking that we put the just transition commission into statute, but I do not think that he is taking on board how long it would then take to get that commission up and running if we do that. I hope to be making an announcement later this year, and that would be considerably in advance of any statutorily-based just transition commission that he might envisage. I would rather get us moving sooner rather than later. As we have heard, today's statistics show that Scotland is outperforming many other countries and in doing so providing a leadership example. However, can I ask the cabinet secretary how important a role international co-operation has been and will be in tackling climate change? International co-operation on climate change is absolutely vital. That is happening through the UN Paris agreement. We are proud to be one of the first countries to enshrine the increased commitment that is required by the Paris agreement into domestic legislation. Following the introduction of the new climate change bill, members might wish to know that we have received a letter from Laurent Fabius, president of the Paris climate conference, welcoming the bill as a, quote, very positive step, unquote, and quote, a concrete application of the Paris agreement, unquote. International co-operation is not just about the actual moves towards climate change mitigation. It is also about climate justice. This Government has put a great deal of money into a climate justice fund, helping to mitigate and tackle the effects of climate change in the poorest and most vulnerable countries in the world. Every country needs to decarbonise their own economy and society in a way that works for them. Many of the changes to technology and infrastructure that will be necessary to achieve net zero emissions can only be developed with multinational co-operation. The Scottish Government collaborates with other high-ambition states and regions through the Under 2 coalition, and the First Minister has signed an MOU with the Governor of California as a fellow member of the coalition. All of that international action is incredibly important, but I am particularly pleased to see the new climate change bill being given that CODOS and that credibility by somebody as important as Laurent Fabius. Following on from that question, cabinet secretary has spoken a lot over the last 18 months about the need to keep pace with the European Union. However, if the EU set a net zero target, as is being discussed by both the European Parliament and the Commission at the moment, will the Scottish Government use that as a reason to set a net zero target for Scotland? I think that Mark Ruskell is in that category of people who want me to have 2024 sites. There is a lot of discussion around net zero, and I understand that. I understand why people want to have those conversations, but a closer look at what is proposed in various jurisdictions suggests a widely varying approach to how that net zero might be reached. In many cases, not legislatively, and in other cases, by excluding all sorts of things that we do include in our legislation. The EU may or may not come out within the future. I do not know. I cannot be certain. However, I will follow their discussions very carefully indeed, as I would expect all Governments to do, and I would hope that they are also looking at the conversations that we are having. I thank the cabinet secretary for early sight of her statement. I welcome the confirmation that we have achieved the target, but I also thank her for her recognition of the significant amount of work that still needs to be done in the areas of building and of transport. She pointed earlier in response to Donald Cameron about the lag effect. In relation to transport, it is fair to say that the Government's proposals on tax cuts for airlines and the support for the third runway at Heathrow are what have happened in the interim since those figures were applied. Why should aviation get a free pass? What message does it send to those in other sectors who are working hard to make emissions savings to achieve the targets that she has set out? If aviation sits within the transport sector, I would anticipate that it is one of the sectors in which I certainly hope that technological changes in the future will make things considerably more manageable in terms of emissions reductions. However, it is important to keep aviation emissions in perspective. Aviation currently accounts for less than 5 per cent of total Scottish emissions based on those new 2016 stats. There is a challenge around aviation, but some of the things that I have said in my responses earlier about growing the economy and about impacts have to be taken on board in respect of that as well. It is important that people consider that if there is to be a challenge in terms of aviation, how many fewer flights do we want coming in and out of Scotland? How many fewer flights do we want internally in Scotland? Those are things that would have to be addressed by some of those questions. I am not saying that to dismiss what the member has said. I know that the member is asking a very genuine question, but there is a genuine conversation that needs to be had about Scotland's wider economy and connectivity as well as the emissions reductions aspect of that. Technical emissions reductions can be achieved, but that would exclude some of the economic social consequences of those reductions. We need to think very carefully into the future about how that is all managed. The cabinet secretary will be well aware that some organisations and NGOs have called on the Scottish Government to set a net zero target in law now, as Sweden has done. I note her comments earlier regarding a credible pathway to net zero. However, should Scotland be minded to adopt the legislative approach of Sweden, what would be the financial impact on the Scottish Government's budget and the further impact on our economy, if it did? It is important to point out that the 2009 legislation set out a very distinctive Scottish approach to the low-carbon transition. That included a strong focus on fair and just action to reduce emissions here in Scotland and statutory annual targets to ensure that Governments are held to account each and every year on the way to 2050. Scotland is the only country in the world to do that. Our approach is working. We continue to outperform the UK as a whole in delivering emissions reductions and to rank highly internationally. We could adopt Sweden's legislative approach. Of course we could. We could put a date on the bill, but it would also mean removing our annual targets because they do not have annual targets. It would perhaps mean substantially reducing the ambition and coverage of our interim targets and allowing for up to 15 per cent of the final target to be met through international credits. The financial impact would be in the region of £15 billion over the period until 2050—money that would need to be found from other areas of Scottish Government budgets. It is not the case that one approach to targets is better than the other, and I applaud Sweden's ambition. However, this Government's view is that the distinctive features of Scotland's 2009 act should be retained and strengthened. I am conscious that we have four more questioners—not at a love time, we might not get them all in—but David Stewart will be followed by Stuart McMillan. The cabinet secretary stated that all future targets will be set and reported using actual emissions, not EU emission trading scheme adjusted statistics. Is this changed due to the UK's likely withdrawal from the EU ETS? Not directly, no. We wanted to do this because we think that it is the right thing to do in terms of transparency and accountability. It does not change our support for participation in the EU ETS in any way. Emissions trading is devolved under the 2008 UK Climate Change Act, and we hope to be fully involved in the decision-making around EU ETS. Regrettably, despite repeated efforts to get responses out of the UK Government, we have not been able to have any formal discussion about that. However, the shift to actual emissions accounting under the bill is about improving transparency and reporting only, and it is not linked to what might or might not happen to the EU ETS. Stuart McMillan will be followed by Fillionaire Carson. Can the cabinet secretary tell me what would be the resultant effect in jobs and in traditional industries and, therefore, local economies, bearing in mind that some organisations have portrayed the 90 per cent target by 2050 as not being ambitious? A 90 per cent reduction target for all greenhouse gases means net zero emissions of carbon dioxide in Scotland by 2050. I think that some people have overlooked that, but the 90 per cent overall target includes net zero on carbon by then. It is interesting that New Zealand, for example, who has a headline indication that they want to go to net zero, is consulting, and one of the things that they are consulting on is net zero on carbon only. I think that there is perhaps a bit of a misunderstanding around and about this discussion. I think that it is important for us to say that. According to the Committee on Climate Change, achieving 90 per cent reduction in all greenhouse gases will require the near total decarbonisation by 2050 of energy supply, ground transport and buildings. That is what we are anticipating. That means transformational change and challenging actions. By far, the largest source of emissions in the CCC's 2050 scenario—at 2050—will be agriculture, which, as I have already said, is not the same as other sectors and needs to be recognised. It cannot produce food without emitting greenhouse gases such as methane. Setting a net zero target for all greenhouse gases before the evidence exists to support that could mean reducing the amount of food produced in Scotland without reducing greenhouse gases at the global level. Finlay Carson. Overall, the statement released today shows a positive trend in reducing emissions, and my colleagues and I in these benches welcome that. However, the house and emissions continue to rise. Does not this show that there is more work for us to do on insulating our homes, particularly in rural areas? The route map for energy-efficient Scotland published last month did not suggest anything to address the unique rural housing problems. While the Government heeded this Parliament's target for an EPCC target, an increase capital investment in home and energy efficiency. That is not again my portfolio area, but the route map for energy-efficient Scotland, which was published on 2 May, sets out our vision for all buildings in Scotland. For Scotland's homes, we propose that by 2040 all homes are improved so that they achieve at least an energy performance certificate rating of Ban C for technically feasible and cost effective. Emma Harper. Cabinet Secretary, you may be aware that there are effective solutions and efficient measures to reduce wasteful and harmful emissions from cattle and sheep and also slurry. Such solutions are available in the form of yeast and also bacterial-based products. I ask the cabinet secretary what plans does she have to enlist the expertise of farm industry specialists to support further agricultural emissions reduction and to continue our progress towards a low-carbon economy? That is an area that we are addressing through the agricultural chapter of the climate change plan, specifically policy outcome 4. There are numerous options on the market. Earlier this year, climate exchange published a report commissioned by the Scottish Government and produced by Ricardo Energy and Environment entitled, reduced emissions from the use and storage of manure and slurry, which would seem to be absolutely on point with what the member is asking about. The report does look at the options available to Scottish farmers and will help to inform discussions. If she hasn't been already aware of it, I would commend it to her. I omitted to draw members' attention to my register of interests in relation to a small shareholding in a wind farm. Thank you, Mr Stevenson. You have now corrected that. Thank you. That concludes our statement on greenhouse gas emissions. We will now move on to the next item of business, which is a statement by Shirley-Anne Somerville on student support. Again, the minister will take questions at the end of her statement. I will encourage members who wish to ask a question to press their request to speak buttons as soon as possible.


Hello and thanks for joining us to check out day 2 of the Otago Classic rally, 7 stages to deal with today and for the internationals like Frank Kelly who is running in a classic escort but in the main game 7 stages is probably not enough for his flamboyant driving style that's turned him in to quite the star. We actually asked him what it is about the Otago Classic. Every rally man in the world knows the best gravel roads are in New Zealand so I never thought I would get here, I thought maybe if I was lucky I would get here to watch somebody else doing us. The opportunity came up last year, we had rally sport Australia did an article on us, we sent them all information they wanted and they mentioned that the Otago might be interested in having us. I sort of thought it wasn't that serious but by Christmas time we were getting a car ready to go in a container. It's been worth it to be fair, the first 3 stages this morning are just highways that I've never seen before. I don't think we even have tarmac roads as wide as that in Ireland, it's the sheer width of them and the surface, fair enough even though they're so wide there's only one line, I couldn't pick a line to save my life but there's a clear line you can see there, no one's been shouting at me all morning to stay on the line but it's the speed you can carry on gravel on fairly sharp corners. It was a bit of a culture shock I'll be honest with you, I was halfway through the 4 stages before I thought this maybe is normal, maybe we were supposed to do this. But it just seems ludicrous, seems ludicrous. Can't stop smiling. I said to Noel McHoldriver when we come out of stage 3 I says my jaw is quite sore and he says what's wrong and I says I can't stop smiling. It was the World Wide Web that first introduced us all to the crazy Irishman. It took 25 years for me to get an overnight sensation. It's all down to my daughter Lauren, she studied media at college and anytime she had to do a project and get a subject, I was the subject, there was plenty of in-car and she was out videoing the stages so she put stuff together, I just can't believe the way it took off. And as advice to other internationals wanting to compete in the Otago rally?  Bring loads of tyres, bring loads of paddle and loads of money.


Hey, y'all we're gonna do a video on how to Value stocks Or stonks as the kids say and I'm just gonna wing it and I'm gonna do the whiteboard method Just to make it interesting I'm gonna have some websites as well But I always like to start with how do you value the s&p because If you learn from the s&p It makes it a lot easier so Shiller PE starting with the s&p 500 PE There are times when the s&p is expensive and There are times when the s&p is cheap and the s&p is a basket of stocks It's also representative Representative of the economy so I don't want to go into the history, but if you're old enough you remember recessions like 2008 or the slowdown in 2002 if you're old enough most likely you're not old enough, but Hopefully you're old enough to remember 2008 or maybe 2020 when everything was shut down When there's panic stocks are cheap when everybody's optimistic stocks are more expensive and This is the PE ratio the price Divided by the earnings a high number not so good a Low number better. However When you do see the low number People will be nervous and scared and when you do see the high number people will be feeling very good and talking about growth this Next slide here is the s&p earnings close the ad and it's quite similar to The s&p chart obviously over time the economy gets bigger The main reason is the government prints money and that's why this was a question. I always had as a kid Why do things always go up and part of the reason is they didn't always used to you Historically as innovation Improves You get deflation, but in a system where the banks print money Things always go up at least they try to make it go up all the time 2% They say but usually you get more the s&p on average grows 7 to 10 percent I'm gonna get it. I'm gonna get to how to value stocks, but we got to use this information So earnings go up s&p goes up when the market is going into a tough period and there's panic and there's recessions Companies earn less and that's why for a temporary period Stocks are cheaper These are the best times to buy stocks, but not everybody has money so just keep that in mind That's that's price to earnings. I'm gonna leave that there for now We can cover price to sales a few other formulas, but We're just going to look at PE first okay, so We've got price and you divide that by earnings and you're just trying to find out You know is this a good deal so earnings Is on the bottom price? Let's say the stock is $100 somebody tells you hey, it's 15 You know my math isn't so good. Let me just it should be 15 100 divided by 15 or 8 100 That's actually a pretty good in PE. That's a PE of 6 So this would be a very attractive deal because Historically if we go back to PE Let's see my My head's in the way a little bit, but if you can see 15 PE to 10 PE historically is very good and Anything above that is very less good So in this example, this would be a super cheap stock if on the other hand the price Was a hundred and the earnings was like Let's say four That would not be as good But actually that's a lot of stocks right now are like that. So this would be a PE of 25 Now we are just looking at PE. We are ignoring all the other information, which is quite useful, but I Used to just look at these PE's and I would think that's enough, but that actually isn't enough Because what you'll learn later on is that when the PE is 6 Although it looks cheap It might be cheap for a reason so they could have debt they could have balance sheet issues The business could be not as good Could be international risk I'm not going to go into that Not in this video and then Alternatively a 25 PE may not be bad the other component that's not shown is Growth so if a company is Not growing at all 25 is expensive Or we might be in a low-rate environment If a company is growing at 30% This 25 is actually cheap Because if a company can and that's a hard hard growth rate if a company can grow at 30% Then every year this company will be 30% cheaper. So this 25 PE Won't be 25 next year If it's growing at that speed it would be like what? Two-thirds of that like 15 maybe and a company owned For many years that grows at 30% will become huge and we want those a Company that doesn't grow. Let's say over here. It's it's 0% Can't draw on this Let's say it's 0% then it's gonna it's actually gonna lose you money They might pay a dividend, but they might have issues and may it may just stay flat and you'll lose opportunity So PE alone doesn't tell the whole story Just like PE alone and the S&P doesn't tell the whole story But that's the number one The first thing most investors look at when they're valuing stocks, that's PE. I Think I'll just leave it there and I'll make another video on Price to sales, but that's just PE a quick overview growth is super important and You find out by by reading some analyst reports or getting some some more digging deeper, but PE alone doesn't tell the whole story, but it does tell you a lot Usually it tells you that there's an implied growth or that investors see something and we need to find out more On the next video, I'll cover Price to sales and I'll show how a small company over time becomes a bigger one and how maybe they don't have earnings but They'll have a price to sales ratio and then Some expected growth rate. We'll see you on the next one


Something is pulling my line. I'm fishing for catfish and come carp I'm using corn As a bait must have to hook yo. All right pulling it's pulling it Let's go. We got a baby Let's try to land it. I don't know what it is yet. He's over here. Oh He's over here.  Oh, man. I'm fishing. There's a dog. Oh, man. There's a catfish here I don't know what these dog want man Then I gotta I gotta land this fish Can you hear the lady? I'm still hooked up with the catfish. Look at the turtle Ha ha ha Look at the turtles trying to have fun with it. All right, man time to land this little guy Do you saw that dog everybody?   You know how it is. You know how we do Ah Let's get this little guy free Let me take it to the water It's much better. Hey little guy There he goes. I thought it was a carp Oh, man Small-ass catfish Do you see do you saw that dog everybody? And the woman calling it while I was hooked up That was funny.  We're at the fishing here. You know how we do


In this video, you will see what happens when an enzyme's environment changes, either too hot or a big change in pH, salt concentration or solvent type, the process called denaturing. The word enzyme means in yeast, where they were first discovered. Zymase, one of the enzymes in yeast, is able to catalyze the conversion of sugar into alcohol and carbon dioxide. Carbon dioxide from this reaction helps bread dough to rise and the ethanol could be the biofuel for Brazilian cars or could be used to make alcoholic drinks. Perhaps the commonest example of denaturing a protein is when you cook an egg. The white of an egg is made of soluble protein molecules called albumin. When heated, these molecules become unraveled and tangled together and the egg becomes solid. So when bread is cooked, the zymase becomes denatured. It loses its specific shape and therefore its activity. It also becomes denatured once the concentration of alcohol reaches about 13% during the fermentation of sugar. This gives us a method for preserving food. Molds and bacteria that cause food to go bad use enzymes to break apart the compounds in the food. Food can be preserved if we can denature their enzymes. So can you think of ways we use to preserve food for a long time? Pause the video whilst you think. The main methods are salting, heating, preserving in acid, like pickling, preserving in alcohol, like wine, freezing. We also preserve food by drying or storing it in sugar. However, these methods do not denature enzymes but work by keeping out water in which mold and bacteria thrive. So why do enzymes unravel like this? Well, the primary structure of proteins is when amino acids, there are 20 to choose from, join with the peptide bond. This coils into a sort of chain held together by the attraction between the amino and carboxylic acid groups, forming their secondary structure, with different R side groups of the amino acids sticking out. Some of these will attract each other and some will repel, enabling the protein to coil up in a very specific 3D shape, its tertiary structure, now able to catalyse a specific reaction in living things. So how does a change in temperature, ionic environment, or solvent cause this tertiary shape of enzymes to be lost? Well, remember that proteins in their secondary and tertiary structure are held by hydrogen bonds and dipoles. These changes work primarily by breaking these weak forces. For example, higher temperatures mean the whole structure is vibrating with more energy, causing the enzyme to unravel. With bread yeast, this happens at around 45 degrees Celsius, but some bacteria, which cause food decay, need to be heated above 100 degrees Celsius to denature their enzymes. Similarly, an increase in concentration of iron such as hydrogen, hydroxide, or salt, or changing the solvent from water, which is strongly polar, to alcohol, will disrupt these dipole forces, causing the enzyme to unfold. Consider a final example, yogurt. Putting friendly yogurt bacteria into milk will quickly drop its pH down to 4, which denatures the digestive enzymes in the yogurt bacteria, but also of any bacteria that fall into the mixture. So making yogurt is a pleasant and useful way of preserving milk. In summary, enzymes are protein molecules folded in a special way to catalyse specific reactions in living cells. Denaturing, caused by changes in temperature, solvent, or ionic environment, is the process by which their shape and therefore their activity is lost. There are various methods of food preservation work by denaturing the enzymes in the mold and the bacteria that cause food to go bad.