Countries affected by virus urged to keep their cool on climate finance for the poor
Senior climate officials warn developing countries are hit hard by the impacts of warming and the fallout from COVID-19 – and failing to provide international funding would make matters worse
By Megan Rowling
BARCELONA, July 10 (Thomson Reuters Foundation) – Rwanda, an East African nation, was one of the first countries to submit a stronger climate action plan to the United Nations this year – and it hopes that this can serve as a basis for a “better and green COVID recovery,” his environment minister said this week.
The plan itself, released in May, does not mention the coronavirus pandemic. But Joan of Arc Mujawamariya said the country is betting that the measures it contains to drive a low-carbon economy – in areas ranging from agriculture to energy – will also make it more resilient to climate crises. and sanitary.
The problem, she says, is finance. The plan contains two scenarios – what Rwanda believes it can achieve with its own spending, and a more ambitious vision that depends on securing sufficient international funding.
Reducing the country’s emissions by 38% by 2030 from a business-as-usual situation – and effectively managing agriculture, water supply and forests as rainfall changes – will cost around $ 11. billion dollars in Rwanda, according to plan.
About 60% of this money must come from international sources, he adds.
Rwanda faces a “structural financial challenge” as its banking sector is small and lacks expertise to support green technology projects in renewable energy or water management, Mujawamariya said at an event in line on climate finance.
One way to close the gap, she said, is to use “blended finance” – like cheap subsidized loans where donor money is used to reduce the risk of default, thereby opening up the way for commercial investors.
The need for combined public and private finance to launch climate-smart projects in developing countries is greater than ever, after an estimated $ 100 billion fled to emerging markets in the first two months of the crisis. coronavirus, experts said.
Yannick Glemarec, executive director of the multibillion-dollar Green Climate Fund (GCF), warned that developing countries could face “a major solvency crisis and years of austerity”, which would make it more difficult for them to recover from the pandemic.
“Developing countries that are already most affected by climate change could end up also being the most affected by the humanitarian and economic tragedy triggered (in) by the COVID pandemic,” he said during the discussion .
During its first five years, the GCF – set up to help vulnerable countries tackle climate change – allocated $ 5.3 billion for 128 projects reduce global warming emissions by 852 million tonnes and strengthen the resilience of 351 million people.
In response to the pandemic, the fund is now providing grants to help developing countries plan for a green recovery. It also tries to minimize delays in the climate projects it funds.
Its managers want to accelerate the development of new proposals and come up with funding models, including blended finance, that will make this a reality, added Glemarec.
The fund is, for example, working on a proposal to electrify more than 1,000 villages, which will improve their ability to provide 24-hour health care, he noted.
The GCF is also considering contributing to a $ 100 million debt fund to keep off-grid electricity providers in business during the economic downturn from COVID-19.
UN Deputy Secretary-General Amina Mohammed said the GCF and its 150 partners could play a major role in helping developing countries accelerate their efforts to tackle climate change without increasing their debt.
In addition to adapting to and mitigating “the catastrophic impacts of climate change”, the assisted countries could “revive and reinvent” the economies affected by the pandemic and achieve other benefits such as better health, better food security and water, she added.
“Climate investments can offer a triple win,” she said.
Ghanaian Finance Minister Ken Ofori-Atta, however, stressed that the pandemic had “derailed” the financing of African countries to achieve their development goals. He called for a “tectonic” change in the global financial architecture.
Currently, for example, most African countries are paying 6-8% interest to borrow money in international markets, despite no recent defaults, he said.
He urged efforts to reduce the amount they pay to repay their debt and increase their access to capital.
African economies are suffering from falling commodity prices and declining income from tourism and remittances, even as governments are forced to spend more on imported medical equipment to deal with the pandemic, a- he noted.
“It makes it more difficult for us, because we are probably going to go from this recession for the first time in the last 20 years to a depression,” he said.
Tariq Mahmood Ahmad, British Minister for South Asia and the Commonwealth of Nations, said rich countries were also facing great pressure on their budgets due to the pandemic, but would have to honor their commitments to help other countries to fight against climate change.
“Our national challenges are immense, but it is a real test of our courage,” Ahmad said at the event.
Britain, a major donor to the Green Climate Fund, has pledged to double the overall amount of international climate finance it provides to £ 11.6 billion ($ 14.7 billion ) for the period 2021-2025.
But aid experts are more widely concerned that international development assistance, some of which is devoted to climate projects, will shrink as the finances of many donor countries are strained by the fallout from COVID. -19.
On Thursday, the Global Commission on Adaptation, a high-level panel, said governments must do more to integrate climate resilience into an estimated $ 10 trillion in coronavirus relief spending.
He urged them to consider investing money in things like affordable storm-proof housing for the slums, public works programs to restore degraded land and community water supplies, and digital weather information services for farmers.
Investments in climate change adaptation “consistently generate high returns” of $ 2 to $ 10 for every dollar spent, he noted in a statement.
Rwanda’s environment minister, meanwhile, said poorer countries could take steps towards a green recovery that would not require large amounts of international funding.
This could include collecting and recycling plastic bottles, banning plastic bags, and cleaning streets and rivers.
“Being poor leaves no room for us to do nothing,” she said. “We must act and we must act yesterday.”
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(Reporting by Megan Rowling @meganrowling; edited by Laurie Goering. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, which covers the lives of people around the world who struggle to live freely or fairly. Visit http: // news .trust.org / climat)
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