Big capital promises to finance the decarbonization of the planet

The large private credit institutions of 45 countries pledged to massively finance global decarbonization by mid-century, although the presidency of COP26 warned that this promise does not replace the funds that large economies owe to developing countries.

The commitment signed by 450 entities such as HSBC, Banco Santander, Deutsche Bank, Morgan Stanley, BVVA, JP Morgan, Grupo Financiero Banorte, Mitsubishi UFJ, Bancolombia or Bank of America amounts to US $ 130 billion (112 billion euros), which “It is more than what is needed for the global transition,” according to UN climate finance chief Mark Carney.

“The money is here. But money needs projects aligned with zero emissions ”, added Carney, noting that it is now necessary for sustainable projects to proliferate to channel those investments announced through the Glasgow Finance Alliance towards Zero Net Emissions.

In addition, that promise will have to be accompanied by mechanisms to measure and verify that this money actually meets its objective.

“Investors need as much clarity and confidence in the climate impact of their investments as they have in traditional profit and loss metrics,” said UK Finance Minister Rishi Sunak.

The United Kingdom, host country of the conference and one of the major international financial centers, also announced this Wednesday that it will force listed companies and financial institutions operating in its territory to design plans on how they plan to decarbonize, which will be evaluated by an agency Independent.

“I agree that we all have to do more,” said the Secretary of the Treasury of the United States, Janet Yellen, who recalled that the United States has announced that it will “quadruple” its climate aid to developing countries.

Yellen assured that Washington will create new “innovative” mechanisms to attract US $ 500,000 million a year in climate finance (432,000 million euros).

Unkept promises

This huge amount of private capital that aims to help prevent temperatures from rising more than 1.5 ° C at the end of the century with respect to pre-industrial values ​​does not close the gap of US $ 20,000 million that rich states owe to developing countries, according to the commitments made in the 2015 Paris Agreement.

At that great climate event, the governments of the planet’s great economies pledged to allocate US $ 100 billion annually to developing countries between 2020 and 2025 to help them undertake the energy transition.

But in 2020 only US $ 79.6 billion was reached, according to the OECD, and that hole is not expected to close before 2023, acknowledged the president of COP26, Alok Sharma.

“The underlying analysis provides confidence that US $ 500 billion will be mobilized between 2020 and 2025. But this is not enough and I have continued to pressure developed countries to go further and faster,” Sharma declared during the climate summit that It is celebrated these days in the British town of Glasgow.

The Chairman of the Least Developed Countries Group, Sonam P. Wangdi, declared that the coalition of 46 states he represents, which is home to 1 billion people, needs “global solidarity”.

“We are the ones who have contributed the least to the problem of global warming. We represent less than 1% of global emissions and yet we suffer disproportionately. Our lives depend on the decisions made here in Glasgow, ”he said.

He demanded “more support for the adaptation of those countries” and, specifically, money for “loss and damage because people are suffering” and “the progress here so far is disappointing and, in some ways, shocking.”

In 2017 alone, Atlantic hurricanes Harvey, María and Irma generated damages of more than US $ 224,000 million and the United Nations estimates that vulnerable countries need US $ 300,000 million a year to finance their adaptation to climate change.

Since the start of the conference, the United Kingdom, Japan and European Union (EU) countries such as Spain, Ireland and Luxembourg have announced new financial contributions, recalled the president of COP26, who expects the summit to close next week with more financial commitments.

Ecopostureo

Large environmental organizations have been skeptical of the new promises.

Greenpeace, for example, has criticized the banks that have joined the initiative last month rejecting a roadmap designed by the International Energy Agency to stop financing new gas, oil and coal projects.