At G-7 Summit, World Leaders Must Commit to Increasing Climate Finance for Developing Countries

Courtesy of Union Of Concerned Scientists
By Rachel Cleetus

The G-7 Leaders’ Summit is underway, from June 11–13, in Cornwall, UK. As host nation for this summit, and the annual climate talks later this year (also known as COP26), the UK will clearly be elevating the need for climate action, alongside dealing with the COVID-19 pandemic and trade issues. One priority that must get urgent attention: richer nations need to make concrete commitments to increasing climate finance for developing countries. Here in the US, 48 groups, including the Union of Concerned Scientists, have just sent a letter to Congress calling for increased funding for climate finance in the federal budget.

President Biden. Image courtesy of White House, via Union of Concerned Scientists

The G7 Leaders’ Summit must prioritize climate finance

At the summit, the leaders of the G-7 countries — the UK, USA, Canada, Japan, Germany, France and Italy, and the EU — will be joined by guest nations Australia, India, South Korea, and South Africa. Tackling climate change is one of the four policy priorities on the agenda.

Ahead of the Leaders’ Summit, the finance ministers of the G-7 nations met last week. The highlight of that meeting was the announcement of a commitment to a global minimum tax rate of 15 percent for major corporations. In a statement, US Treasury Secretary Janet Yellen said: “That global minimum tax would end the race-to-the-bottom in corporate taxation, and ensure fairness for the middle class and working people in the US and around the world.”

However, in terms of climate outcomes, the Finance Ministers’ Communique was disappointing. There were vague mentions of commitments to achieving net-zero emissions by mid-century and no major new financial commitments for clean energy investments or adaptation needs in developing countries, raising the stakes for more concrete actions at the Leader’s Summit and ahead of COP26.

On international climate finance, specifically, the text stated:

“We commit to increase and improve our climate finance contributions through to 2025, including increasing adaptation finance and finance for nature-based solutions. We welcome the commitments already made by some G7 countries to increase climate finance. We look forward to further commitments at the G7 Leaders’ Summit or ahead of COP26. We call on all the Multilateral Development Banks (MDBs) to set ambitious dates for Paris Alignment ahead of COP26, and welcome their work supporting client countries.”

The unfair and worsening toll of climate impacts

Worldwide, climate impacts are unfolding in terrifying and costly ways. Worsening heat waves, floods, droughts, tropical storms and wildfires are taking a mounting toll on communities and economies.

Last month, for example, the unusually intense Cyclone Tauktae struck the coast of Gujarat in India, after traveling up the western coast causing heavy rainfall and floods. The cyclone took the lives of over 100 people, including 86 at an offshore oil and gas facility. Tauktae was the fifth strongest Arabian Sea cyclone on record, with peak winds of 140 mph, and tied for the strongest Arabian Sea landfalling cyclone. This latest storm is part of a trend toward increasingly frequent and powerful storms in the Arabian Sea that scientists have attributed to climate change, and that is expected to worsen.

And in a new ground-breaking study, researchers found that across 43 countries, 37 percent of summer heat-related deaths can be attributed to human-caused climate change. In several countries, including the Philippines, Thailand, Iran, Brazil, Peru, and Colombia, the proportion was greater than 50 percent.

The bottom line is that many developing countries that have contributed very little to the emissions that are fueling climate change are bearing the brunt of its impacts. Richer nations, like the United States, which are responsible for the vast majority of cumulative carbon emissions to date, must take responsibility for the harm being inflicted on poorer nations.

Climate finance is also desperately needed for developing countries to make a low-carbon transition. To have a fighting chance of limiting some of the worst climate impacts, the world will have to cut heat-trapping emissions in half by 2030 and achieve net-zero emissions no later than 2050. The recent IEA net-zero by 2050 report points out that this is both feasible and affordable — as long as we make proactive, intentional investments in clean energy and curtail fossil fuels now, globally. That includes investments in decarbonizing every sector of the global energy system. It also means providing electricity to the 785 million people who currently do not have access, and clean cooking solutions to the 2.6 billion people who need them, most of whom live in developing countries — two priorities which the IEA estimates could be achieved by 2030 at a cost of about $40 billion a year and would deliver tremendous public health and economic benefits.

The necessary scale of international climate finance

In 2009, at the annual climate talks in Copenhagen, richer nations pledged to raise $100 billion a year to help developing countries cut their carbon emissions and adapt to climate change. Over ten years later, they have fallen woefully short.

The UNEP Adaptation Gap Report 2020, points out that “Annual adaptation costs in developing countries alone are currently estimated to be in the range of US$70 billion, with the expectation of reaching US$140–300 billion in 2030 and US$280–500 billion in 2050.”

Here in the US, the Biden administration and Congress must step up and ensure that this year’s federal budget includes a significant down payment on a US fair share contribution to climate finance, ahead of COP26. Forty eight groups, including the Union of Concerned Scientists, have just sent a letter to Congress, calling for a Fiscal Year 2022 allocation of at least $69.1 billion to support critical development goals and dedicating at least $3.3 billion of that for direct climate change programs as a step towards significantly increased international climate finance.

This is a minimum threshold, and a lot more will be needed in the years to come, including concrete steps from richer countries to recognize and respond to those crushing impacts of climate change that poorer nations simply will not be able to adapt to.

Sharp cuts in carbon emissions needed

Sharp cuts in global carbon emissions remain a core priority, especially with the latest data confirming — again — that we are far off track from where we need to be. While the 2020 economic downturn led to a brief dip in emissions, they are set to rise at a record-setting pace in 2021. Here too, richer nations must do much more. The Biden administration has made a significant commitment, pledging to cut US emissions 50–52% below 2005 levels by 2030, and we must now secure the domestic policies to deliver on that goal, starting with the American Jobs Plan.

An unconscionable gap between the rich and the poor

The gap in climate finance for developing countries is unconscionable. This mirrors the inequity in global vaccine availability, with richer nations stockpiling billions of surplus vaccine doses even as many countries have barely received any. With the climate crisis compounded by the COVID-19 pandemic and the resulting economic crisis, millions of lives are at risk and many more are being driven into poverty.

Just as with the COVID-19 crisis, solving the climate crisis will require collective global action. Equity is at the heart of ensuring the success of our efforts. Richer nations must both make sharp cuts in their own global warming emissions and contribute to climate finance for developing countries.