Egypt climate champion calls for new metric on climate finance

Developing country climate financing needs should start being reframed at the UN climate summit in November, in order to move beyond the outdated – and unfulfilled – $100 billion that rich nations had pledged to deliver each year, the UN high-level climate champion for Egypt said, Reuters reports.

With food and energy inflation already being driven by climate concerns and the war in Ukraine, the world needs to deliver more financing to help developing nations for their energy transition and ability to adapt to climate challenges, like drought or sea level rise, Mahmoud Mohieldin said.

“The finance architecture of climate is inefficient, insufficient and unfair,” Mohieldin said in an interview, noting that the $100 billion pledge made in 2009 will expire in 2025. To date, it has only ever been partially met.

Mohieldin said the funding gap could be addressed through measures aimed at mobilising the private sector finance, reducing poor country debt, extending highly concessional multilateral financing and creating tailored carbon markets in Africa.

He said countries were also working to change the perception that climate-related investment in developing countries was too risky by putting together a pipeline of viable climate projects that could be presented at November’s summit.

Currently, 33 projects, including 19 from Africa, had been identified, he said.

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He also said he hoped the “loss and damage” agenda was discussed at the COP27 summit that Egypt will host in Sharm El-Sheikh in November. That effort calls for a separate fund to be set up to compensate developing countries for damages already being incurred in climate disasters, such as extreme floods.

Vulnerable countries have long sought funding for such costs, but rich nations have resisted steps that could legally assign liability or lead to compensation.

Many questions remain unresolved, including where the funds would come from, and how they would be paid out.

“Definitely, it needs more than just a quick reference to it, especially since some of the advanced economies are saying, well, it’s there, but let’s deal with it within the adaptation portfolio,” he said.

Visiting Pakistan last week in the wake of devastating floods, UN Secretary General, Antionio Guterres, urged governments to address loss and damage at COP27 “with the seriousness it deserves”.