IDB will triple financing to confront the climate crisis in Latin America

He Inter-American Development Bank (IDB) will triple to US$150 billion over the next ten years the financing for resilience and mitigation projects aimed at dealing with the climate crisis in Latin America and the Caribbean.

The president of the IDB, Ilan Goldfajn, announced in an interview with EFE that this is the commitment that the multilateral entity brings to the COP28 Climate Summit, which began this Thursday in Dubai (United Arab Emirates) and which the executive attends.

Goldfajn specified that this is an objective in line with the G20 recommendations of tripling climate finance and urged “all” participants of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP28) to do the same.

The IDB Group thus aims to increase climate financing for Latin America and the Caribbean, expand work on global public goods – such as the Amazon -, catalyze private sector participation and develop new financial instruments to be able to mobilize more capital towards climate action. .

The Brazilian director recalled that in the last ten years the IDB invested 50 billion dollars in the climate, which is one of its priorities along with issues of poverty, inequality, growth, productivity and infrastructure.

He mentioned hurricanes in the Caribbean as examples of latent threats, which “they are becoming more frequent and stronger,” the need to adapt to this situation with better infrastructure and housing or the drought in Uruguay and the floods in Brazil, as was the case of those that occurred in Recife.

“But we are also going to help finance climate change, help for the energy transition”expressed Goldfajn about one of the pillars of the climate summit.

“I think what is happening is that everyone has a notion that we must make the energy transition,” said about the general disposition of the sectors participating in the world forum.

“It is clear to all sides that what needs to be done is to have energy on a scale that works for the world and that that energy now has to be clean,” he added.

The president of the IDB emphasized that COP28 “It clearly has its objectives”among which are also the increase in commitments to reduce emissions and the elimination – not just reduction – of fossil fuels.

Goldfajn was also convinced that there is already a better understanding between the environmental and economic sectors, pointing out that “without having a sustainable world, you do not have a sustainable economy.”

For the president of the IDB, in Dubai we have to think about “the scale and the impact.” The scale is the tripling of resources because ““It’s what’s needed.”but we must be sure, in his opinion, that what is tripled has an impact.

“What is really going to defend the Amazon? What is going to change the energy matrix of the countries? We must be much more sure what we are investing in”, he emphasized.

Crucial defense of the Amazon

The Amazon, according to the multilateral entity, is fundamental for the IDB Group in terms of climate and biodiversity, and is well positioned to offer solutions to the global challenges of climate change.

He recalled the important participation of renewable energies in its energy matrix and the abundance of mineral reserves crucial for the green transition of the Amazon rainforest, considered the world’s carbon sink.

Through Amazonía Siempre, a holistic umbrella program aimed at protecting the region’s natural wealth and accelerating its sustainable development, the IDB Group is committing up to US$ 5 billion in financing for the area in the next decade for sustainable development projects, leveraging partnerships and financing from multiple stakeholders and countries.

In 2024, the IDB will assume the presidency of the Groups of Multilateral Development Banks (MDB) and Heads of Regional Development Banks (BRD), which according to the entity are essential to meet the G20 objective of reviewing the global financial architecture to address adequately address climate change.

For Goldfajn, the priority is to make the MDBs work better as a system, harmonizing rules and processes, including the continued coordination of climate and nature projects.