COP27 calls on the private sector to help the most vulnerable countries

The COP27 Climate Summit on Wednesday called on the private sector to help the most vulnerable countries and those that are suffering the most from the effects of climate change, with a focus on the issue of loss and damage, which has already begun to be discussed at the Sharm el Sheikh conference.

The special representative for the COP27 Presidency, Wael Aboulmagd, said at a press conference on the day dedicated to finance that talks on the point of “loss and damage have already begun” and expects there to be a “significant result” at the end of the summit, although he pointed out that it will not be until 2024 when it is active.

One of the main issues at this COP has been the compensation to the poorest countries for the damage caused by climate change, a point that they have called loss and damage, and that for the first time has been included in the agenda of a climate summit.

Richer countries have been reluctant to accept responsibility for historical emissions, and so far have failed to provide the level of support developing nations say they need.

The senior advisor to the climate directorate of the European Commission, Jacob Werksman, today defended the support of the European Union (EU) to finance the losses and damages because they recognize that they have “a historical responsibility for emissions disproportionately” and that the Old Continent has become “rich, partly thanks to the benefits of building an economy dependent on fossil fuels”.

$2.4 TRILLION BY 2030

COP27 presented a report on Tuesday calling on the private sector to invest $2.4 trillion a year by 2030 needed by emerging and developing countries to reduce emissions, increase resilience and cope with the loss and damage caused by the effects of climate change.

According to the report, emerging and developing countries must work with investors and multilateral institutions to unlock a trillion dollars annually in external financing for mitigation, adaptation, and loss and damage by 2030.

Additionally, 1.4 trillion will be needed annually by 2030 for energy transition, said at a press conference the expert of the London School of Economics and one of the authors of this document, Nicholas Stern.

“The total annual investment needs for emerging market and developing countries other than China are estimated to be $1 trillion by 2025 and $2.4 trillion by 2030,” he said.

The report also calls for grants and low-interest loans from developed country governments to double from $30 billion to $60 billion annually by 2025.

These sources of finance are “critical” for emerging and developing countries to support actions to restore land and nature, and to protect and respond to the loss and damage caused by climate change.

This report published by the London School of Economics and Brookings Institution has been prepared by a group of independent experts, led by Vera Songwe and Nicholas Stern, at the request of the Egyptian COP27 Presidency and the British COP26 Presidency.

CO2 CREDITS FOR DEVELOPING COUNTRIES

In this context of private sector aid to the most vulnerable countries, the United States Special Envoy for Climate, John Kerry, announced today at COP27 that his country will collaborate with the Rockefeller Foundation and the Bezos Earth Fund to promote the creation of a CO2 credit market that developing countries can sell to finance their energy transition.

This collaboration will be conveyed through the so-called Energy Transition Accelerator (ETA), which will aim to boost private investment for the deployment of renewable energy and the withdrawal of fossil fuel assets in developing countries, which will operate until 2030 and expandable to 2035.

To launch this accelerator, which has already been interested in countries such as Chile and Nigeria and companies such as Bank of America, Microsoft or Pepsico, the three partners will work with governments, experts, the private sector and civil society.

Companies could use the credits to go further on their mitigation goals, contribute to climate finance or other voluntary targets, as well as contribute to the achievement of a host country’s Nationally Determined Contributions (NDCs).

Source: EuroEFE