Financing the future we want
As we mark the 50th anniversary of Earth Day, and the global community grapples with a health emergency more devastating than any in living memory, the interlinkages between people, planet and prosperity could not be more striking.
This is powerfully highlighted by the UN Secretary-General’s observation that, “Had we been further advanced in meeting the Sustainable Development Goals and the Paris Agreement on Climate Change, we could better face this challenge - with stronger health systems, fewer people living in extreme poverty, less gender inequality, a healthier natural environment, and more resilient societies”.
Instead, worldwide millions of jobs have been lost because of the Covid-19 crisis and millions more are at risk without public support. Vulnerable communities in developing countries who face the double burden of the COVID crisis, and the effects of climate change will suffer the most as the pandemic escalates.
As national and global leaders consider stimulus measures to revive economies, the world is at a major turning point, with either a rare opportunity for a global course correction that will accelerate the shift to low carbon more resilient societies, or entrench our dependence on fossil fuels and increase our vulnerability to future crises. These choices that we make today will have consequences for generations to come.
Oil prices at historically low levels represent a great temptation not to change the development model and promote a carbon-intensive recovery like the response to the 2008 crisis, which was accompanied by a sharp increase in CO2 emissions. At the same time, historically low oil prices are also an opportunity to phase out fossil fuel subsidies and use scare public resources to support projects that promote employment in the short term and low carbon and resilient societies in the longer term.
Many projects can meet this dual objective. For example, energy efficient building and investment in grid and storage solutions can catalyze massive private investment in clean energy; while investments in climate resilient agriculture, water management and sanitation will preserve livelihoods and foster ecosystem restoration.
These extensive projects require comprehensive policy development and innovative financial structuring to use public resources to catalyze and align private financial flows with the SDGs and the Paris Agreement.
The GCF will continue to support developing countries in these efforts by making critical climate investments in such projects, which are also essential to preventing, responding to, and recovering from the COVID-19 pandemic.
The GCF will also focus on access to finance for small and medium enterprises and local governments to promote community level socio-economic benefits from climate action and is ready to assist partners in developing green stimulus measures.
There is no trade-off between public health, healthy ecosystems and healthy economies. This year, more than ever, as we are acutely aware of the widespread suffering resulting from the global COVID pandemic, Earth Day is an important reminder that caring for humanity and caring for the environment is the common endeavor. The Green Climate Fund will continue investing in people, the planet, and a prosperous future for all.