"During the meetings, new pledges of $11B were made to make the World Bank bigger and boost three of its initiatives (the eight Global Challenges Programmes, hybrid capital, and the Liveable Planet Fund). Not only is this amount peanuts compared to what is required under reparative and climate justice; as long as those are debt creating instruments, where the driving question is whether private financiers can profit rather than whether it will actually help people and planet, these initiatives will remain doomed from the start. "The World Bank cannot become bigger before better. A true reform would mean stopping seeking profit-based approaches to attract private sector to the climate space, when we know that private finance is limited for mitigation, neglects adaptation, and is completely inadequate to address loss and damage. A true global reform of IFIs should prioritise grant-based finance, provide measures to increase the fiscal space in the Global South, end their large financing for fossil fuels, and change their governance structures to enable more voice and participation from the Global South." —Joab Okonda, Pan-Africa senior advocacy advisor at Christian Aid ----------------------- **Should we use potential profits to attract the private sector into backing climate finance?** There's an old view of value creation, measured in profit, vs. a more enlightened view based on shared, universal value — harder to put in numbers but far more powerful. Does that mean we shouldn't try to attract the private sector with profits? They can be a major force of momentum, but does it backfire if we lock developing countries in debt? Is there an approach where we offer moderate, long-term profits, allowing countries to get the funds they need without crossing the line into dangerous debt? https://lnkd.in/dR-vmwfi --Related-- IMF, Oct 2022: https://lnkd.in/dXsTSSgn IMF, Oct 2023 (see page 16): https://lnkd.in/dUjADA5V #climatejustice #climatediplomacy #climatefinance #IMF #WorldBank
Matthew Honold’s Post
More Relevant Posts
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As The World Bank and International Monetary Fund gather for their spring meetings Saliem Fakir, Executive Director of The African Climate Foundation warns against a false dichotomy: whether to finance development, or to invest in transitioning developing countries to net zero. Read the full story >> GreenCB.co/3PZotoU #WorldBank #IMF #JustTransition #ClimateChange
The choice between development or climate finance is false one
https://greencentralbanking.com
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It is well known that many countries are already saddled with high levels of debt and cannot afford to enter into more loan agreements. In fact, 34 out of 59 emerging economies that are the most vulnerable to climate change also face a high risk of financial crises in the next two years. Therefore, multilateral institutions are working (albeit slowly) to diversify ways of easing the debt burdens of these emerging countries. This is where debt-for-nature swaps may be able to help.
Climate finance: What are debt-for-nature swaps and how can they help countries?
weforum.org
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On April 17, 2024, key stakeholders gathered at the IMF-World Bank Spring Meetings in Washington, D.C., to discuss the complex interrelation of debt, climate action, and development. Organized by E3G in collaboration with International Institute for Environment and Development (IIED), the Wilson Center Brazil Institute, CONCITO, and Climate Policy Initiative, this event provided a platform for a comprehensive dialogue on the intertwined issues of current debt stock and liquidity constraints impacting nations' resilience. The discussion, held under the Chatham House rule, emphasized the urgent need for tailored diagnostic tools, bold solutions outside the slow-progressing Common Debt Framework, and innovative financial instruments integrating climate considerations. The G20 Brazilian Presidency's priorities, including country platforms for mobilizing affordable finance and leveraging multilateral actors' finance and expertise, were highlighted as potential pathways for addressing these challenges. Participants underscored the necessity of holistic solutions, public finance core contributions, and expediting International Financial Institutions (IFIs) reforms to foster inclusive economic development and mitigate climate risks. Read more about it here. https://lnkd.in/eUJf6bzT #DebtChallenges #ClimateAction #SustainableDevelopment #G20 #Finance #GlobalDevelopment #EconomicResilience
Navigating Debt Challenges: G20's Pursuit of Sustainable Solutions
wilsoncenter.org
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African negotiators have long argued that substantial reforms to global financial systems is necessary for climate finance. Developing countries can be free of debt burdens and free up resources for sustainable development and resilience building. Maria Nkhonjera, MCom from The African Climate Foundation outlines how reforms to global tax, trade and development finance architecture would be a win-win scenario for developed and developing countries. Read more below. #climatefinance #development #sustainability https://lnkd.in/dVamUTwa
Making the Global Financial System Work for Africa - African Climate Wire
https://africanclimatewire.org
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Africa remains $2.5 trillion short! Despite pledges made to boost lending for climate the ability for donor contributions and IFIs, alike, to allocate sufficient resources towards climate finance remains in question. "The call for an ambitious replenishment of IDA21 is an important step to availing more concessional resources, and potentially additional climate finance, for impoverished countries. The unveiling of new financial instruments, that could potentially generate $70 billion over years is welcome. But real impact will be felt when needs of people are met," writes Saliem Fakir, our executive director in African Arguments. https://lnkd.in/dEENtvhz For further background, read our related white paper here: https://lnkd.in/dkHVQDqS #SpringMeetings #ClimateFinance #Africa #FinancialReform
Climate finance: Did the IMF/World Bank spring meetings move the dial? | African Arguments
https://africanarguments.org
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The Task Force on Climate, Development and the IMF published its recommendations on how to enhance IMF/WB Low Income Country Debt Sustainability Framework. Our top line recommendation is to capture climate risks and growth enhancing effects of climate investments. We also make recommendations on improving data, scenario design, the role of macro-financial models, and why a risk management approach can help us get serious about possibly high impact risks. https://lnkd.in/dRHSDSKd Tim Hirschel-Burns and I wrote up a blog to answer some questions on why the debt sustainability analysis matters for climate change and development https://lnkd.in/dhtU_GgP
Room to Grow: Integrating Climate Change in Debt Sustainability Analyses for Low-Income Countries
https://www.bu.edu/gdp
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Particularly interesting article here on the interrelationship between developing countries, credit and debt, the IMF, and potential greenwashing... The title of "Greenwashing" Structural Adjustment says it all... Definitely worth a read! https://lnkd.in/eFUphG72 Greenwashing Research Project The Credit Rating Research Initiative #creditratings #IMF #debt #climate
“Greenwashing” Structural Adjustment | Lara Merling
https://www.phenomenalworld.org
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Executive Vice President - Impact, Environmental Defense Fund Member at Chief
🌍 Momentum for Multilateral Development Bank Reform This week's Spring Meetings of @The World Bank and @International Monetary Fund in Washington DC are pivotal in addressing the climate crisis. As we progress through 2024, we need urgent reforms within multilateral development banks (MDBs). Key reforms we’re looking out for: - Mobilizing Private Finance: Collaborative partnerships can unlock private finance potential for climate resilience. - Enhancing Lending Terms and Concessional Finance: Improving terms and capacity aids vulnerable countries. - Streamlining Bureaucratic Procedures: Faster access to financing, especially in disaster response. - Limiting Debt Burdens: Mechanisms like grants ease pressures on countries facing climate shocks. Finance is key to climate action. These reforms hold the potential to significantly enhance the flow of finance to the Global South, where it's needed most. As we prepare for climate finance discussions at COP29, MDBs must build trust and support developing countries' just transition. https://lnkd.in/dTYmQ97D
Multilateral Development Banks Must Turn Words into Action on Climate Finance
https://blogs.edf.org/climate411
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Mobilize Catalytic Capital by Linking Supply (Global South) with Demand (Global North) to increase Nature-based Solutions financial flows. Climate Fintech Startup for Water & Trees - Benefit people & planet w/ROI -
CLIMATE ACTION: “- Mobilizing Private Finance: Collaborative partnerships can unlock private finance potential for climate resilience.” Such climate funding could come from multiple sources who target impactful climate action to decarbonize but also hit multiple SDG goals such as water/food/income/gender equality and biodiversity.
Executive Vice President - Impact, Environmental Defense Fund Member at Chief
🌍 Momentum for Multilateral Development Bank Reform This week's Spring Meetings of @The World Bank and @International Monetary Fund in Washington DC are pivotal in addressing the climate crisis. As we progress through 2024, we need urgent reforms within multilateral development banks (MDBs). Key reforms we’re looking out for: - Mobilizing Private Finance: Collaborative partnerships can unlock private finance potential for climate resilience. - Enhancing Lending Terms and Concessional Finance: Improving terms and capacity aids vulnerable countries. - Streamlining Bureaucratic Procedures: Faster access to financing, especially in disaster response. - Limiting Debt Burdens: Mechanisms like grants ease pressures on countries facing climate shocks. Finance is key to climate action. These reforms hold the potential to significantly enhance the flow of finance to the Global South, where it's needed most. As we prepare for climate finance discussions at COP29, MDBs must build trust and support developing countries' just transition. https://lnkd.in/dTYmQ97D
Multilateral Development Banks Must Turn Words into Action on Climate Finance
https://blogs.edf.org/climate411
