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Who finances the fight against the climate crisis? All and none

Governments, companies and multilateral organizations must finance the fight against the climate crisis, although there is a lack of concreteness, as was clear last Thursday at the forum “Making climate action count”, organized by the World Bank (WB).

A few weeks before the climate conference starts in November COP26 in Glasgow (the United Kingdom), the World Bank organized this digital event, held within the framework of its annual meeting with the International Monetary Fund (IMF).

In a somewhat lackluster event due to the fact that most of the speeches were prerecorded, the director of the World Bank, David Malpass, spoke; the Secretary of the Treasury of the United States, Janet Yellen; the President of Colombia, Iván Duque, and Prince Carlos of England, among others.

Broadly speaking, all of them emphasized the need for the public and private sectors, and multilateral institutions, to finance the transition to an economy that respects climate change, although perhaps the most forceful were the secretary general of the HIM-HER-IT, António Guterres, and the president of COP26 in Glasglow, Alok Sharma.

Less words and more action

Guterres recalled that as the celebration of COP26 approaches, it is necessary to comply with the commitments made in the Paris Agreement to cut polluting emissions by half by 2030 and achieve zero by the middle of this century, with a increased investment in developing countries.

In his opinion, this point has not yet been reached and he was “particularly concerned” about the lack of progress with regard to public funding.

“Let me be clear, US $ 100 billion a year from public and private sources for mitigation and adaptation in the developing world is the minimum,” said the UN Secretary General, who mentioned the importance of multilateral development banks in this ambit.

In his opinion, there are no institutions better situated for this purpose than this type of bank to finance the adaptation of economies in the fight against the climate crisis, since if they do not do it, “no one will.”

Yellen also emphasized the role of multilateral development banks and noted that the United States, as one of the largest contributors to these entities, is committed to using this leadership position to help transition the global economy to zero. emissions by 2050.

He also highlighted the role of the private sector, because “no amount of public financing alone will be sufficient to meet the objectives of the Paris Agreement.”

In this sense, Yellen cited “the challenges” that emerging and developing markets face when attracting private capital to finance projects that mitigate the repercussions of the greenhouse effect and the adaptation of infrastructures.

Carlos of England, with the great managers

In this regard, Prince Charles of England explained that he has met with executives of large companies from different countries to see how to act in the face of climate change.

However, the priorities advanced by these entrepreneurs, which Carlos de Inglaterra detailed, point more to efforts from governments, consumers and multilateral banks, than from the companies themselves.

For example, one of them is for Executives to send signals to the markets about a calendar and a long-term economic direction that will incentivize the fight against the climate crisis.

Throughout this event, which lasted an hour and a half, World Bank officials stressed that it is important to fight poverty when fighting the climate crisis.

This was pointed out by the managing director of WB Operations, Axel van Trotsenburg, who indicated that precisely for this reason the climate action plan designed by his body includes what the Climate and Development reports have come to call.

“The WB’s mission is to reduce poverty and we have made great progress, but climate change could undo part of this progress in the worst cases and we could even see an increase in extreme poverty,” he warned.

The virtual event was seasoned with videos of projects in different countries on efforts against global warming.

Malpass stressed in his speech that this battle is uneven, since, on the one hand, there are the advanced economies that have admitted to being the cause of most of the emissions and that should increase efforts to reduce them.

And on the other, he added, there are the poorest nations, which account for less than a tenth of these emissions and which need investment in infrastructure to adapt and be resilient.

Colombia’s “bold commitment”

These countries are joined by others such as Colombia, which, according to Malpass, “are middle-income economies that have been affected by the crisis as they recover” and that must think about how climate change can affect them and contribute to efforts to mitigate it.

At this point Duque spoke, who stressed in English that his country comes to Glasgow with a “bold commitment and a goal to achieve.”

He then listed his commitments, such as reducing greenhouse gas emissions by around 51% by 2030; reach carbon neutrality by 2050, that is, not emit more than what can be absorbed, and achieve zero deforestation and have 30% of the Colombian territory protected by 2030.

Colombia wants to go to COP26 with homework, but there is still much to do at the global level, as Sharma pointed out.

And it is that “more can be done, specifically with regard to the use of public financing to mobilize private funding on a larger scale,” he warned.

For this reason, the president of COP26 in Glasgow urged governments, multilateral development banks and private institutions to attend the November meeting “with an action plan to invest more, mobilize more and finance more” the efforts against global warming.

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