G-20 finance ministers under pressure to deliver climate funding

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ROME – The world’s 20 largest economies faced mounting calls to boost climate finance for poorer nations as ministers met on Friday (July 9) in Italy, with green groups warning a failure to fresh money could throw November’s key climate talks into doubt.

Developed nations are under pressure ahead of the COP26 climate conference in Scotland to a promised US$100 billion (S$134 billion)a year for vulnerable countries to adopt clean energy and adapt to a warmer planet, up from about US$80 billion in 2018.

After a June summit of G-7 leaders ended with a commitment to meet the US$100-billion goal but lacked detail on how and when, the UN chief, Britain and a group of 48 developing nations this week called for a clear plan for its delivery.

Speaking to G-20 finance ministers on Friday, UN Secretary-General Antonio Guterres said such a plan was “not just about the economics of climate change” but also about solidarity and “establishing trust in the multilateral system”.

He called US$100 billion a year the “bare minimum” wealthier nations should be providing as poorer parts of the world battle fiercer storms, floods and rising seas and try to ramp up clean energy use.

“From the Caribbean to the Pacific, developing economies have been landed with enormous infrastructure bills because of a century of greenhouse gas emissions they had no part in,” he said in prepared remarks.

Half of all climate finance should be spent to help countries adapt to a hotter planet, including through resilient housing, elevated roads and early warning systems that save lives and livelihoods, the UN chief added.

Only about a fifth of international climate finance for developing countries goes to adaptation today.

Lidy Nacpil, coordinator of the Asian Peoples’ Movement on Debt and Development, urged developing countries at the two-day meeting in Venice – including Indonesia and India which are part of the G-20 – to push their wealthy counterparts to boost funding.

“They have to be clear how much and by when. They have to deliver,” she told the Thomson Reuters Foundation by phone from Manila.

“We’re not asking for help. This is an obligation (for developed countries) because of their historical emissions.”

In 2009, donor nations agreed to increase climate finance for vulnerable countries to US$100 billion annually by 2020, and under the Paris Agreement said they would negotiate a yet-higher amount that would kick in from 2025.

But reaching the target has proved a challenge. A UN-commissioned report said in December it was unlikely the goal had been met in 2020 amid the economic woes of the coronavirus pandemic, although firm figures are not yet available.

Only Germany, Canada and Japan offered new money at the G-7 meeting last month – and climate finance experts and campaigners are calling on the United States, Italy and Australia in particular to give more, to make up their fair share.

“Now it is up to the finance ministers and leaders of the G-20 meeting in Italy to the money,” said Saleemul Huq, director of the International Centre for Climate Change and Development in Bangladesh.

“Failure to deliver the money before COP26 in November will make the COP a failure,” added Mr Huq, who has urged climate-vulnerable nations to skip the Glasgow talks if the funds are not delivered by November.

Delivering the much-needed money has become a thorny issue ahead of COP26, with many developing countries already under huge financial stress from dealing with the Covid-19 pandemic.

Alok Sharma, the British official who will preside over the COP26 talks, said earlier this month that, ahead of that UN summit, “we are going to need all developed countries to make ambitious finance commitments for the next five years”.

“I have to tell you that the frustration that I hear from leaders and ministers in developing countries that these funds still remain uncertain is absolutely palpable,” he added, referring to the unmet US$100-billion goal.

The International Institute for Environment and Development, a London-based research group, said that while the G-7 had fallen short, the G-20 “has the chance to make it up”.

Its director Andrew Norton also urged the G-20 to create a new initiative to allow indebted, climate-vulnerable countries to swap their debt or access new bonds – and use those resources for to tackle climate change and protect nature.

Others urged G-20 nations to end their backing for fossil fuels and channel the money instead into climate action.

A tracker run by groups including the Overseas Development Institute (ODI) shows the G-20 has committed at least $297 billion to support dirty energy since the pandemic began in early 2020.

Angela Picciariello, a senior research officer at ODI, said fossil fuel finance remains a “huge problem”.

“As long as G-20 countries continue propping up the fossil fuel industry, key priorities such as investing in renewable energy and energy efficiency will not pay off,” she said in emailed comments.

The G-20 meeting will be followed by a climate conference in Venice on Sunday, where governments, investors and development bank officials will discuss how public policies can help attract more private finance into efforts to cut emissions to net zero.

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