Finance ministers’ commitment to support climate action boosts momentum for the Paris agreement…

Climate Action Network (CAN) Europe welcomes the fact that global finance ministers attending the joint World Bank and International Monetary Fund summit in Lima expressed their commitment to scale up climate finance. This is an essential element for a successful global agreement on climate change in Paris.

CAN Europe calls on the EU to provide a comprehensive plan on how it intends to reach its fair share of climate finance in the run up to Paris, and ensure that all committed funds truly serve the purpose of empowering developing countries in their efforts to tackle climate change.

Recent pledges to increase public climate finance have given a much needed boost to the mobilization of funding for international climate action – Wendel Trio, Director of CAN Europe said. This positive momentum should be sustained through considerable pledges from all EU Member States in the run up to the climate summit in Paris.

According to CAN Europe, it is crucial that the EU provides a comprehensive plan on how it intends to ramp up support for developing countries. It needs to contribute USD 24bn per year by 2020, as this is its fair share of reaching the global goal of USD 100bn. The recent announcement by China that it will increase its climate finance to USD 3bn after 2020 puts pressure on the EU to clearly spell out its commitments.

The pledges represent important political steps at a crucial time, but the donor countries need to provide more clarity on their details – Wendel Trio added. This cannot just be an exercise of relabeling existing aid as supporting climate action. We welcome all aid to support sustainable development. However, shifting funds from support to education and health towards climate action is not going to convince developing countries to join an ambitious agreement in Paris.

Moreover, the recent OECD report showed that countries over-estimate the actual transfers that vulnerable countries’ governments are receiving, through the inclusion of loans and credit guarantees. According to CAN Europe, meeting the climate finance promise must not become an issue of smart accounting of private investments. CAN Europe believes the USD 100bn should be comprised of public funds, with private finance additional to that sum.

Public finance is essential for the world’s poorest communities who do not tend to live in places that attract private investment. Developing community disaster preparedness plans, planting mangroves for protection from storms and rising seas, or developing small-scale irrigation systems, for example, do not generate financial returns and will not attract the business sector investments.