Developing nations press the case at Cop27 for billions of dollars of climate finance

Developing nations at Cop27 have issued an urgent call for financial assistance so they can cope with the harm caused by climate change — and a new report has said that wealthier countries should provide them with $1 trillion each year to do so. The report, “Finance for climate action: scaling up investment for climate and development”, says that foreign governments, international financial institutions, the private sector and multilateral development banks (MDBs) should offer the cash. Developing nations themselves, through public and private sector institutions, need to find a further $1.4 trillion annually by 2030, according to the United Nations-backed study. Key themes at Cop27 have been loss and damage funding — compensating poorer countries for the harm caused by climate change — and the related but even more contentious issue of reparations by rich nations because of their role in warming the planet. Richer countries have been reluctant to agree that they have a responsibility because of historical emissions, and have until now not provided the level of support that developing nations say they need for climate-friendly development and to adapt to the impacts of climate change. The recent floods that devastated large parts of Pakistan and an extreme drought in the Horn of Africa offer vivid evidence of how poorer parts of the world are suffering some of the most extreme effects of climate change. Mia Mottley, the Barbadian prime minister, said that developed nations should do more to help. “We were the ones whose blood, sweat and tears financed the Industrial Revolution,” Ms Mottley said at a Cop27 event organised by the Scottish government. “Are we now to face double jeopardy by having to pay the cost as a result of those greenhouse gases from the Industrial Revolution? That is fundamentally unfair.” Mottley said “grant-funded reconstruction” was needed by countries that experienced climate-induced upheavals. “Unless that happens, we are going to see an increase in climate refugees,” she said. “We know that by 2050, the world’s 21 million climate refugees now will become one billion.” Echoing Ms Mottley’s comments, Matthew Samuda, a Jamaican minister, said that richer countries had “a moral imperative” to make clear they were providing support because of their role in causing climate change. “But beyond that, there is also the practical need of being able to access funds,” he added. The new report, released by the Independent High-Level Expert Group on Climate Finance, centres on the help needed by developing nations, excluding China. It says that “the world needs a breakthrough and a new roadmap” that can provide $1 trillion of external finance. “There is a significant role for public policy and government action to foster investment, and complementary roles for the private sector, MDBs, international financial institutions, and concessional finance of various forms,” the report says. It also says that trust has been eroded by a failure to deliver pledges made by developed nations “at successive Cops” to provide $100 billion per year in climate finance by 2020. “According to the latest assessment of delivery plans, the $100 billion commitment will be met only in 2023, three years past the target date, and only then mainly because of increased financing from the multilateral development banks,” the report says. “Bilateral public finance, which is the most important indicator of the direct contribution by developed countries, has not increased measurably since 2016 and there remain important shortfalls in its quality. “The delivery of the $100 billion is an immediate task, but governments of developed countries need to go well beyond that, starting now.” Investments are needed in “net zero, adaptation, resilience and natural capital”, as this will allow for better development than the “dirty and destructive pathways of the past”. Some wealthier nations have made pledges at Cop27 to support developing nations affected by climate change, with commitments in some cases running into the billions of dollars. In his address to the summit on Monday, British Prime Minister Rishi Sunak said that from 2021 to 2026 the UK would spend at least £11.6bn ($13.3bn) on climate finance. During his first appearance at a major international event since becoming prime minister, Mr Sunak said this would include a tripling of spending on adaptation to £1.5bn by 2025. On Monday, Germany pledged €170m towards a fund from the G7 group of nations to support poorer countries, while Belgium offered €2.5m, in its case specifically for Mozambique. In comments reported by media, Olaf Scholz, the German chancellor, said his country would additionally “support those countries hit hardest by climate change in a targeted way in dealing with loss and damage”. The Independent High-Level Expert Group on Climate Finance was set up earlier this year and is co-chaired by Vera Songwe, a Cameroonian economist, who is executive secretary of the UN’s Economic Commission for Africa, and Lord Stern, a British academic at the Grantham Research Institute on Climate Change and the Environment, part of the London School of Economics and Political Science.

Developing nations press the case at Cop27 for billions of dollars of climate finance

A staggering $2 trillion is needed every year if developing nations are to turn the tide on climate change, report says