A new fund helping low-income countries tackle the impacts of climate change already has around $40 billion worth of commitments, but this is "nothing in comparison with the needs," IMF chief Kristalina Georgieva said Tuesday.
Several countries have won loan deals from the International Monetary Fund's Resilience and Sustainability Trust (RST), but global leaders are urging that more be done to aid nations grappling with the costly fallout from climate change.
"If we do nothing to move financing… by 2030, 66 percent of carbon emissions will come from the developing world," Georgieva said in an interview with AFP.
"If we want to succeed in our fight against climate change, it is paramount to move financing to where it would make a difference," she added, on the sidelines of a panel discussion on the RST.
For now, the three countries that have crossed the finish line with RST financing are Costa Rica, Barbados and Rwanda, while a deal with Bangladesh is headed for further approval.
"The interest is very significant from both low-income countries and vulnerable middle-income countries, especially small island states," Georgieva said.
She added that the IMF expects more members to commit resources "so we don't end up having to ration support for countries."
At the panel in Washington, Barbados Prime Minister Mia Mottley said long-term capital is needed for many issues, adding that debt sustainability metrics could be revisited.
"Every dollar of debt is not equivalent. A dollar of debt to build a school does not give me the same rate of return as quickly as a dollar of debt to build a geothermal facility," she said.
World Trade Organization Director-General Ngozi Okonjo-Iweala also stressed at the event the importance of supply chains when it comes to building resilience in developing countries.
"Supply chains for certain products are highly concentrated. Eighty percent of vaccines are exported from 10 countries," she said, adding that similar situations may apply to items like solar panels and chips.
"Why can't we… diversify manufacturing… so we have supply chains that are global, and diversified, and more resilient?" Okonjo-Iweala said.
Rich nations oppose new biodiversity fund
Montreal (AFP) Dec 13, 2022 –
Creating a new global fund for biodiversity — a core demand of developing countries at UN talks in Montreal — "would take years" and be less effective than reforming existing financial mechanisms, Canada's environment minister said Tuesday.
Ottawa's position reflects the consensus among developed nations on the thorny issue, which has emerged as a key sticking point in negotiations to hammer out a new global pact for nature at the meeting, known as COP15.
Delegates from around the world have gathered for the December 7-19 summit aiming to secure a new deal: a 10-year framework aimed at saving Earth's forests, oceans and species before it's too late.
Draft targets include a cornerstone pledge to protect 30 percent of the world's land and seas by 2030, eliminating harmful fishing and agriculture subsidies and tackling invasive species and reducing pesticides.
Dozens of countries, led by Brazil, India, Indonesia and African nations, are demanding financial subsidies of at least $100 billion a year until 2030, or one percent of global GDP, to protect ecosystems. The current figure is around $10 billion annually.
"The countries of the North understand that ambition must be accompanied by financial resources," Canadian Minister of Environment and Climate Change Steven Guilbeault said at a press conference held halfway through the talks.
But "my concern is that the creation of new funding could take years, and during those years, countries in the South wouldn't be receiving any money from that fund," he added.
He recalled the Global Environment Facility, currently the main multilateral mechanism for biodiversity, took seven years to create. Donors have pledged $5.3 billion to this fund for its current cycle, 2022-2026.
"So I think it would be better to use existing funds" while pursuing reforms that would make money more accessible, he said.
"On the other hand, we have to agree on the fact that it cannot only be public money," said Guilbeault, stressing that private and philanthropic contributions must come into play, as well as multilateral lenders such as the World Bank and IMF.
"We all need to push harder this week," he concluded, after the first week of talks ended in stalemate.
– Yawning funding gap –
The divide between developed and developing nations on the issue of creating a new biodiversity fund mirrors a similar debate during recent UN climate talks in Egypt on creating a "loss and damages" fund for the most climate-vulnerable nations — though that demand was eventually met.
Given this precedent, Basile van Havre, co-chair of one of COP15's working groups, did not rule out a similar decision for biodiversity.
"The landscape or the context now is a lot more favorable," he told AFP, acknowledging growing political momentum for such a move.
Whatever the final mechanism, the gap in expectations over resource mobilization that would allow lower income nations to hold up their side of the biodiversity deal remains a sore spot.
"The EU says it hears the needs of the Global South and the Africa Group, and recognizes that current finances are not enough. So what is the hold up?" said Greenpeace policy advisory Anna Ogniewska.
