By Richard Folland and John Willis of Planet Tracker | In collaboration with the Global Ethical Finance Initiative
2024 should be the year of international climate finance. COP28 and Global Stocktake in Dubai fall short of meeting the needs of climate change mitigation and adaptation and energy transition challenges, especially emerging and developing economies (EMDEs) It is widely recognized that .
Finance will also be a focus of this year’s international negotiations on biodiversity and nature. A priority for COP16 on the Convention on Biological Diversity (CBD), to be held in Colombia in late October, will be monitoring progress on the Global Biodiversity Framework (GBF).[i] It was agreed at the last CBD COP in Montreal to consider how public and private funds can be mobilized to achieve the GBF.[ii]
One of the positive developments in Dubai (which began at COP26 in Glasgow with the Declaration on Forests and Land Use) is that be Integrating climate and nature challenges.
For example, COP28 hosted both a day dedicated to nature, land use and oceans and a day dedicated to food, agriculture and water.[iii] This close coordination confirms the views of climate scientists recognized in the last United Nations Assessment Report (Sixth Assessment Report). [AR6] in 2023[iv]) interdependence between climate change impacts and biodiversity status; The authors commented on the “interdependence of climate, ecosystems, biodiversity and human society.”[v], [vi]
These international declarations are important. But as the climate and nature crisis deepens, Policy makers and decision makers will increasingly be judged by their ability to implement policy. Against this backdrop, could 2024 bring about major changes in how international public and private finance respond to the twin crises?
There are several grounds for optimism. His UNFCCC party’s discussions in Dubai led to his one important development on finance. new Collective Quantification Goals (NCQG) What is needed is to provide an overall framework for existing and new revenue sources to set new climate finance targets. To move this process forward, COP29, to be held in Baku this November, was agreed as the time for governments to report on their financial plans to contribute to the overall collective goals.
it’s obvious Early stages of how NCQG will unfold in practice. However, this represents a step change in ambition to exceed the previous climate finance floor of $100 billion a year (which Global North governments should admit has failed) in terms of financing the Paris targets. It shows. And it could be more than that.
- provide a framework for New and innovative sources of incomefor example by expanding carbon taxes.
- In line with the UNFCCC’s core objective of new and substantially more ambitious National Emissions Reduction Targets (NDCs), within the Paris “ratchet cycle” that ends with Brazil’s COP30 in 18 months’ time. National financial platform model This was made clear from the recent World Bank/IMF Spring Meetings in Washington, DC.
- It chimes too A rapidly growing climate and the challenges of development reform The plan is being driven by leaders from the Global South, including Kenyan President William Ruto and Barbados Prime Minister Mia Mottley, and prioritizes climate finance policies from the World Bank and multilateral development banks (MDBs). .
The most positive developments have been made with respect to nature and biodiversity finance. Include financial responsibility, objectives and policy alignment in GBFadopted in December 2022.
First, Goal 14 of the framework refers to the need to integrate biodiversity-related finance and financial flows into policies, regulations, plans and processes.[vii] Second, financial institutions, together with multinational corporations, are required to monitor, assess and disclose their impacts and dependencies on biodiversity (target 15).[viii]). Some recent environmental regulations exclude financial institutions. Not this time. Third, there are moves to reduce harmful incentives such as subsidies that harm biodiversity.
Goal 18 aims to reduce emissions by at least US$500 billion per year by 2030. These incentives will be determined next year.[ix] Finally, Target 19 calls for mobilizing $200 billion a year for biodiversity by 2030.
In the short term, international funding from developed countries is expected to reach $20 billion a year by next year and $30 billion by 2030.[x]
new and innovative funding sources will be necessary to deal with the crisis of Nature. In our view, one of the areas where policymakers should redouble their efforts and achieve common objectives on climate change and natural finance is: Subsidy.
The latest figures from the IMF show that the amount of public money devoted to oil, gas and coal subsidies (despite all the rhetoric about subsidy cuts at the G7 and other international fora over the past decade) ) remains an astonishing figure of $7 trillion. In addition to this, a 2022 study by The B Team and Business For Nature found that at least US$520 billion per year goes to the environment, not just in agricultural subsidies, but also in forestry (US$155 billion) and fishing (US$50). It is estimated that harmful subsidies are also allocated. a billion).[xi] In 2019, the Paulson Institute valued subsidies harmful to biodiversity at US$274 billion to US$542 billion, and estimated positive flows to biodiversity conservation at US$124 billion to US$143 billion.[xii]
The United Nations has a platform to use grants to move things forward. The CBD is expected to address existing subsidies affecting nature later this year. At COP28 in Dubai, the GST document included language on “phasing out inefficient fossil fuel subsidies” and we hope that the NCQG submission will take advantage of the opportunity to address this language. Masu.
Other ways climate and nature decision makers can collaborate include: carbon market. Voluntary carbon markets have long been viewed with skepticism, given the lack of common international standards and their association with offsets. Nevertheless, there is likely to be a push for biodiversity credits that can provide nature-based solutions to emissions reductions. And Colombia’s CBD could advance with related innovative financing instruments.
Last but not least, UN climate and biodiversity processes can mutually support national policies and plans. In a recent high-profile speech in London titled “Two Years to Save the World”, UNFCCC Executive Director Simon Stiehl set out what is at stake, particularly in the new and ambitious He said gradual changes in NDCs are essential. At his COP16 this autumn, governments are expected to submit their own national plans (equivalent to National Biodiversity Strategies and Action Plans – NBSAP – Nationally Determined Contributions from Climate Change – NDC). To date, seven countries and the EU have submitted his NBSAP.[xiii]
Our new multipolar world is becoming more dangerous in many ways, as sadly conflicts are occurring all over the world. But there are also more positive signs of the times. A new generation of leaders in the South, such as Kenya’s Ruto and Barbados’ Mottley, have provided leadership to drive a common climate and development agenda and push for a climate overhaul. Noda. IFIs and MDBs are more in tune with the global challenges of 21 countries.cent century. Lewis lula Da Silva, Brazil’s president also plays a central roleBrazil is hosting this year’s G20 and 2025’s COP30.
In short, this year must be a year of international climate and natural finance transformation, which could repair some of the trust between North Korea and the EMDEs after past failures. As we describe, some stars may be aligned. The results of COP16 and COP29 will be a litmus test. And as always, What ultimately matters is political will..
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[i] Convention on Biological Diversity – Kunming-Montreal Global Biodiversity Framework – Accessed 30 April 2024
[ii] Convention on Biological Diversity – COP 16 Colombia – Accessed 30 April 2024
[iii] COP 28 UAE – Thematic Program – Accessed 30 April 2024
[iv] IPCC Sixth Assessment Report (AR6) – Climate Change 2023 – Accessed 30 April 2024
[v] IPCC Sixth Assessment Report (AR^) – Overview for policy makers (3 pages)
[vi] Planet Tracker – The role of nature in a livable future for all – Explaining the latest IPCC report – March 22, 2023
[vii] Convention on Biological Diversity – Global Biodiversity Framework – Target 14
[viii] Convention on Biological Diversity – Global Biodiversity Framework – Target 15
[ix] Convention on Biological Diversity – Global Biodiversity Framework – Target 18
[x] Convention on Biological Diversity – Global Biodiversity Framework – Target 19
[xi] Business for Nature and the B Team – Financing for Survival: Building a Nature-Positive Economy through Subsidy Reform – February 2022
[xii] Deutz, A., Heal, GM, Niu, R., Swanson, E., Townshend, T., Zhu, L., Delmar, A., Meghji, A., Sethi, SA, and Tobin-de la Puente, J. 2020. The nature of financing: Closing the global biodiversity financing gap. The Paulson Institute, The Nature Conservancy, and the Cornell Atkinson Center for Sustainability.
[xiii] Convention on Biological Diversity – National Biodiversity Strategies and Action Plans (NBSAP) – Accessed 30 April 2024
