Cop28: Finance Day unlocks billions for climate actions.

By Avit Ndayiziga

Unity, action, and delivery are prerequisites in the realm of finance to enable climate action. said Dr.Werner Hoyer, president of Emirates Islamic Bank during COP28 Finance Day.

Today, December 4, 2023, marks Finance Day of COP28. It is the most important day of Conferences of the Parties as it unlock funds to implement concrete actions of mitigation and adaptation. Meanwhile, the sweltering heat outside COP28 meeting rooms, reminds us that 2023 is recorded as the hottest year, thus, finance is required to reach the1.5C limit.

This finance day comes after the first global stocktake (GST) of three High-Level events that tackled adaptation, means of Implementation, and Mitigation which held on the 1st and 2nd December 2023.

This first global stocktake unveiled the hypocrisy behind climate change actions. After 28 years of conferences, the fight is off track with a huge gap of trillions between flows and investment needs in emerging markets and developing economies that suffer adverse effects of climate change.It also bore witness of a deep loophole between ambition and action achieved so far.

The GSTurged a need to turn all stones with a paradigm shift to accelerate ambition, action, and support across the agenda.

Good climate change ambitions and actions remain daydreams if finance is not available to enable them. 

To this end, vault key holders or big fishes in the global financial sphere met at the panel to address the complex and ever-evolving financial challenges surrounding climate change.

These tycoons hold the key to securing the planet Earth and ensuring a sustainable future for all through tangible and equitable climate change solutions accompanied by available, accessible and affordable funds.

Simon Stiell the UN Climate Change Executive Secretary emphasized that finance is undeboutedly the climate action great enabler.

“Finance is the great enabler for climate action.” He also warned world leaders to get away from the notions that funding for developing countries is charity or development aid. Adding “As long as they think of climate funding this way, it remains vulnerable.”He ended up calling for investment in climate mitigation and adaptation everywhere as enlightened self-interest.

However, alarmingly, the Global Stocktake demonstrates that rather than accelerating, progress on adaptation is stagnating. Stiell noted “I am solutions-oriented. The bad news is not a reason to despair and slow down. For me, it spurs action.”He concluded.

This goes hand in hand with what COP 28 president and UAE state oil company boss – Sultan al-Jaber had said during the opening ceremony that climate funding must bridge the gap between ambitions and action to concretize this year’s cop 28 slogan of unite, act, and deliver.

Earlier this morning, COP28_UAE announced that it has mobilized over $57 billion so far from governments, businesses, and investors.

For fans of showboating, this afternoon, a panel of discussion included faces of tycoons with whom anyone would like to sit together and pose for a picture with them, why not share a cup of coffee? The panel tackled climate funding availability, accessibility, affordability, and an architecture to deliver it to all.

A panel of discussion of tycoons to address the complex and ever-evolving financial challenges surrounding climate change.

The panelists included Ms.Kristalina Georgieva, Managing Director, International Monetary Fund(IMF), Dr.Akinwumi Adesina, President of African Development, Ms.Mafalda Duarte, Executive Director, Green Climate Fund, Dr.Mahmoud Mohieldin, High-level champion, COP27 presidency, Mr. Jin Liquun, president of Arab Jordan Investment Bank and Dr.Werner Hoyer, president of Emirates Islamic Bank.

Dr Hoyer urged climate financial decision-makers to be serious and to avoid sending wrong signals from this cop28.

Dr.Werner Hoyer, president of Emirates Islamic Bank

“We have been in Sharm el-Sheikh last year, Washington, Marrakesh, and we have a big event in Paris, have we made progress? Look at what is written up on the ceiling, unite, act, and deliver. Have we delivered? I think now we must deliver, no reduction of ambition when it comes to climate action. He mentioned, adding that “we should stop putting climate action, development, and innovation in three different boxes, these three belong always together if we want to be successful,” he highlighted. “Even though we are on the right track, it is not enough.”He concluded.

Calling it a day, Finance Day has indeed been beneficial. Global leaders have pledged to implement financial reforms to strengthen the climate resilience in vulnerable nations.

The above reforms aim to provide support to countries most affected by climate change.

One of the notable achievements of the day is the remarkable pledge for the second replenishment of the Green Climate Fund, amounting to $12.8 billion.

Additionally, a new fund dedicated to addressing the impacts of climate change, known as the loss and damage fund, was launched, with an impressive $655 million pledged thus far. These developments signify significant progress in tackling the effects of climate change.

On the other hand, prominent entities, including the UK, France, World Bank, Inter-American Development Bank, European Investment Bank, European Bank for Reconstruction and Development, and African Development Bank, made key announcements during COP 28. They have pledged to expand the use of Climate-Resilient Debt Clauses (CRDCs), with support from 73 countries. This initiative aims to provide fiscal space for climate action by urging donors to extend the use of CRDCs by 2025.

These initiatives mark a significant step towards reforming the global climate finance system, in line with the vision outlined in the COP28 UAE Declaration. 

The declaration saw its endorsement by several countries such as India, France, Barbados, Kenya, Ghana, Germany, the UK, the USA, Senegal, and Colombia, laying out principles for an inclusive climate finance structure that is accessible, affordable, and available to all.

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