Guest article: Climate of compromise: How climate finance commitments are slowing progress on the SDGs | SDG Knowledge Center

By John Nordbo, Climate Advisor at CARE Denmark

At the Copenhagen Climate Change Conference in 2009, developed countries pledged to support climate change adaptation and mitigation activities in developing countries. The Copenhagen Accord stipulates that developed countries would provide increased climate finance to developing countries, reaching $100 billion per year in 2020.

This commitment to climate finance was not an altruistic promise from the wealthiest developed countries. It was one component of a broader global green deal that pledged climate finance to help countries in the Global South scale up climate action as part of their sustainable development efforts.

The global North has failed to reduce its own emissions fast enough to bring climate change under control, and global warming has reached a level that has required costly adaptation to climate change. It was therefore agreed that developed countries would bear at least part of the bill for climate action in the countries of the South.

Importantly, in recognition of existing development priorities such as eradicating extreme hunger and poverty, the Group of 7 (G7) and other wealthy nations have not only pledged to provide “increased” climate finance, but also pledged that funding would be “new and additional” to existing overseas development assistance budgets.

Rich countries have failed to meet their climate finance commitments

Released to coincide with the G7 talks currently underway in Germany, CARE’s latest report, ‘It’s Not New Money’, outlines how public climate finance reported to the UNFCCC by the G7 and 16 other rich countries was truly “new and complementary” to their development support.

The report finds that most public climate finance reported by rich countries from 2011 to 2018 came directly from development assistance budgets.

Countries have never formalized a definition of “new and additional”, which needs to be agreed as part of the ongoing UNFCCC negotiations. But if we take the pledge from rich countries to provide 0.7% of gross national income (GNI) as official development assistance, and ask how much climate finance has been provided on top of that, the figure is as low as $14 billion, or 6% of what was reported.

If we apply a more generous definition and use the baseline of development finance provided by rich countries in 2009, when they committed, $99 billion, or 45%, of global North public climate finance is additional .

Even by this weaker definition, the majority of climate finance is still development finance diverted to climate change action, which means less financial support for health, education, women’s rights and climate change reduction. of poverty.

The members of the G7 bear the responsibility for most of the failure.

Canada, France, Germany, Italy, Japan, the United Kingdom and the United States represent some of the world’s largest economies reporting significant amounts of climate finance. Collectively, G7 countries account for 85% of climate finance reported by all rich countries from 2011 to 2018.

But despite declaring significant amounts of finance, these major economies are providing almost no additional climate finance, as they have not provided 0.7% of their GNI as official development assistance (ODA).

CARE’s new research is particularly damning in the face of current global challenges, including Russia’s invasion of Ukraine, global energy and food insecurity, and the ongoing effects of the COVID-19 pandemic. The financing required for investments in the SDGs is vast and urgently needed. Recent statistics from the OECD show that development assistance is already dispersed between the SDGs, humanitarian response and relief, COVID-19 and refugee costs. According to the World Food Program (WFP), a total of 45 million people are on the brink of starvation in 43 countries unless they receive immediate help to save their lives and livelihoods.

External public resources such as ODA remain essential for developing countries

The harsh realities of climate change will add substantial costs to development programs in the Global South, threatening the achievement of the SDGs and creating a cycle of poverty that will be increasingly difficult for countries to overcome.

This, in turn, undermines resilience to climate change, as highlighted in the April report of the Intergovernmental Panel on Climate Change (IPCC), which noted that “a key agreement was that climate finance should be “new and additional” not the cost of the SDGs.

The IPCC explains what millions of people in the Global South experience firsthand, namely that “resources prioritizing climate at the expense of non-climate development finance increase a population’s vulnerability at a given level of climate shocks, and the additionality of climate finance is therefore essential.”

Meanwhile, wealthier countries continue to adapt and build their own resilience to the global climate crisis.

The injustice of an “either/or” funding model

In the face of this funding inequity, it is imperative that the G7 and other UNFCCC Annex II Parties begin to honor their obligations and commitments to provide $100 billion in new and additional climate finance each year, and that rich countries are following the example of Luxembourg, Norway and Sweden by disbursing all of their climate finance in addition to the commitment to provide 0.7% of their GNI in the form of ODA.

Countries that have not yet reached the 0.7% target should redouble their efforts to do so over the next few years and ensure that their climate finance comes on top of a growing aid budget.

Financing for climate change adaptation and mitigation is essential. However, it should not replace pre-agreed funding to support the SDGs. In many contexts, the physical realities of climate change will add substantial costs to development programs in the Global South.

Diverting funds from poverty, health and education initiatives in developing countries to climate change mitigation and adaptation strategies in an “either/or” scenario, which is unfair. This short-sighted approach will only serve to widen the inequality gap between developed and developing countries, slow down the achievement of the SDGs and, above all, force those who have contributed least to the climate crisis to pay the highest price.

About Emilie Brandow

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