Raising ambition to act on climate change and raising the large amount of finance needed to do it are so completely inter-connected that governments and the entire financial sector must see it as a single challenge.

High-level representatives from across the sector on Monday, November 13, 2017 at the COP23 Finance for Climate Day highlighted their efforts to meet the goals of the Paris Climate Change Agreement and underlined that this challenge of coordination and coherence needed to be quickly addressed.

They set out what needs to be done next by governments, cities, states, business and multilateral institutions to secure the pace and scale of investment required, before and after 2020, to meet the Paris goal of keeping the average global temperature rise well below 2 degrees Celsius and as close as possible to 1.5 Celsius.

Eric Usher, Head of UNEP Finance Initiative, said: “At the heart of the climate challenge are two gaps we urgently need to bridge: the ambition and the investment gap.”

“It is up to national governments now to increase the ambition of their NDCs to close the 17 GtCO2e emissions gap that we still face for 2030. When it comes to the investment gap, however, we need all financial players – public, private, domestic, international – and including markets and regulators, to work together effectively to mobilise at least $1.5 trillion of climate finance that is needed every year. Let this Finance Day be the start of a new and determined chapter of climate finance innovation, collaboration, and impact,” he said.

What is more, every dollar invested in cutting greenhouse gas emissions and adapting to climate change gets double the bang for the buck because the results directly support the only sustainable future possible, which is captured in the international community’s 2030 Agenda for Sustainable Development.

Finance for climate is flowing at a greater pace than ever, with vibrant and growing markets for renewable energy, electric vehicles, green buildings and climate-smart agriculture seeing aggressive growth, backed by exponential advances in innovative green financial instruments, indices and markets.

Equally, the finance sector is recognising to a much greater degree where and how climate change presents risks to its existing investments and the need to adjust their portfolios away from carbon-intensive assets to reduce that risk.

However, amid discussions at COP23 on Monday, much more is said to be needed to secure finance and investment at the scale required to deliver a fully de-carbonised and climate-resilient global economy by 2050.

Laura Tuck, Vice President Sustainable Development, World Bank, said: “The potential for climate friendly investment in areas such as clean energy and climate-smart agriculture is enormous.

“The key is to get the funding to flow so that everyone everywhere can benefit from low-carbon and climate resilient investments. That’s why we are working with the UN and our other development partners to create the conditions that will attract investors and to get all forms of finance – public, private, philanthropic – working together for maximum impact,” she said.

Vladis Dombrovskis, Vice-President of the European Commission, said: “Hundreds of billions of euros in investment are needed to transition to a low carbon economy and meet the target of well below 2 degrees warming. This is a challenge but also an opportunity for the EU to become a magnet for green investment and lead the way in mobilising both public and private financing for sustainable projects. That is why we are preparing for early next year an Action Plan on sustainable and green finance.”

Brahim Hafidi, President of Souss-Massa Region and First Vice-President of the National Association of Moroccan Regions, said: “Today ‘Localising is the new Globalising’, and Cities and Regions around the world have demonstrated their leadership in climate action for inclusive, resilient, sustainable and low carbon infrastructure development plans.”

“The Global Mapping of Initiatives for Localising Climate Finance, launched today by the Cities Climate Finance Leadership Alliance, shows acceleration in providing funding, financing and technical assistance support to local and regional governments from the whole range of stakeholders. This major publication is a unique reference-compass to help match demand and supply. The integration of local and subnational projects in NDC investment plans, especially for adaptation and resilience funding and financing, is a key priority,” he said.

Peter Damgaard Jensen, CEO of Danish Pension provider PKA and Chair of the Institutional Investors Group on Climate Change (IIGCC), said: “Strong investment signals from policy makers across carbon trading, energy, transport and buildings are essential to unlock the necessary capital. Climate-related disclosure consistent with the recommendations of the FSB’s Task force will also be paramount, to provide greater legal certainty alongside efforts to ensure an international level playing field.”

“That is why my organisation is launching a new programme focused specifically on investor practices in this area, with a focus on ensuring ongoing dialogue between IIGCC’s growing membership of asset owners and managers about latest developments of climate disclosure in line with TCFD recommendations. Effective pricing of climate related risk by financial markets is essential to help realise the goals of the Paris Agreement,” he said.

The High Level Finance for Climate Day at COP23 focused on:

• Investment to reallocate capital flows towards low-carbon and resilient growth, with additional upfront capital or risk sharing, to deliver financial returns and resource savings;
• Inclusion to ensure that flows reach the countries and communities with greatest needs in terms of both sustainable growth and reducing vulnerability, effectively doubling flows to developing countries by 2020;
• Integration to make the long-term consequences of climate change and wider sustainability factors a routine part of financial decision-making and accountability both in terms of opportunity and risk, to avoid financial system instability;
• Innovation to enable green deal flow, particularly risk sharing for emerging economies and frontier markets, for domestic markets to grow;
• Infrastructure that provides climate resilience tapping the financial system’s endless capacity for innovation and speed of action;
• Transparency on finance and investment through simple and harmonised approaches, norms and standards that in turn support climate investment plans and polices tailored to national needs, priorities and capacities, that attract diverse capital sources and greater private sector risk.

Global CO2 emissions are forecasted to rise by two per cent in 2017, after a three-year flat period, British researchers said on Monday, November 13, 2017.

China was pointed to as the main culprit with projected fossil fuel emissions growth of 3.5 per cent.

Researchers at the University of East Anglia said that emissions from all human activities would reach 41 billion tonnes in 2017.

They added that the figure would be “an unwelcome message’’ for delegates at a UN climate conference under way in Bonn, Germany.

The research, published simultaneously in the journals “Nature Climate Change’’, “Earth System Science Data Discussions’’ and “Environmental Research Letters’’, shows that CO2 emissions are expected to decline by 0.4 per cent in the U.S.

While 0.2 per cent in the EU, those are smaller decreases than the average over the previous decade.

Lead Researcher Corinne Le Quere, director of the Tyndall Centre for Climate Change Research at the University of East Anglia, said increases in coal use in China and the U.S are also expected this year, reversing their decreases since 2013.

“Global CO2 emissions appear to be going up strongly once again after a three-year stable period, this is very disappointing,’’ Quere said.

African countries are already spending up to 20 percent of their total needs presently on climate adaptation, which is more than their fair share without any support from the international community, a new study by the United Nations has revealed.

Early findings from the study jointly commissioned by the UNDP Regional Office for Africa, and the African Climate Policy Centre (ACPC) at the UN Economic Commission for Africa (UNECA) to review African commitment to adaptation has therefore dismissed the insinuation that African countries are not investing in their own climate adaptation responses and are instead waiting on the international community as recipients of support.

“African countries are already spending between 2 to 9 percent of their Gross Domestic Product on adaptation, thus reducing the potential impact of climate change by more than 20 percent,” Dr Johnson Nkem, a Senior Climate Adaptation expert at the ACPC told PAMACC News at the ongoing climate negotiations in Bonn, Germany.

The UN study is being implemented by two United Kingdom centres – Climate Scrutiny and Mokoro – to provide estimates of Africa’s public expenditure on adaptation as a proportion of the total cost for adaptation.

Although the level of investment as a proportion of GDP expenditure varies among countries, it ranges between 2 and 9 percent of GDP; and represents more than other forms of expenditure in public services such as healthcare and education.

“This contribution is significantly higher than the adaptation resource flow from international sources,” said Nkem.

The study therefore recommends that the disproportionate share of investment in adaptation as opposed to its smallest share of contribution to the global greenhouse gas (GHG) emissions, needs to be fully recognised and boosted under global financing mechanism for climate response, especially under the implementation of the nationally determined contributions (NDCs).

Some of the study’s key findings are that, African countries are already making a major contribution to adaptation that constitutes; that for Africa as a whole, the estimated adaptation gap is about 80 percent; and that the adaptation gap is greater than 90% in nine countries. Most of these countries face major exposure and sensitivity to climate change risks as well as fiscal challenges.

Countries that have reduced the potential impact of climate change by more than 20 percent, include those with low climate change risks like Liberia, Namibia and Zimbabwe; high expenditure, for example Ethiopia, Gambia, Zambia; and lower risk and good expenditure countries like Rwanda, Senegal, Uganda.

The objectives of the Review of African Commitment to Adaptation was to provide some initial estimates of the current spending on adaptation by African governments, and to assess the extent to which this funding meets the scale of the adaptation challenge as determined by the Intergovernmental Panel on Climate Change (IPCC) and other assessments.

According to Nkem Ndi, there is a growing political will and socio-economic motivation in addressing climate change in Africa’s development agenda as demonstrated by the level of public expenditure on adaptation to climate change in the continent.

He pointed out that most adaptation expenditure in Africa is primarily linked to development expenditure that provides good benefits with current climate conditions.

Estimates of the adaptation expenditure were provided by classifying the most recent public finance data, preferably actual expenditure data rather than budget data, if it is available.

Actual data for 10 countries, and data obtained from the internet for additional 24 countries were used for the analyses in this study. The entire analyses in the study does not include expenditure by development partners that is outside the budget.

The study notes that despite its miniscule share of responsibility for the causes of climate change, Africa has always been labelled as a tenuous recipient of development assistance, with unending expectations of support in addressing climate impacts on its development.

While this stigma is baseless, it remains to be fully disbarred using empirical studies demonstrating regional investments for climate adaptation by the countries.

Courtesy: PAMACC News Agency