Developing countries need $1 trillion annually to deal with the effects of climate change
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A report Tuesday said developing countries must work with investors, rich countries and development banks to secure $1 trillion in external financing annually to avoid the adverse impacts of climate change by the end of the decade.
The report, issued ahead of the United Nations Climate Change Conference (COP27) currently taking place in Egypt, says finance is needed to reduce emissions, increase resilience, deal with the damage caused by climate change and restore nature and land .
The report, commissioned by current and former climate summit hosts Egypt and the UK, added: “The world needs a breakthrough and a new roadmap for climate finance that can mobilize the trillions of dollars in external finance that… by 2030 for emerging and developing countries other than China.”
He stated that the total annual investment needs for developing countries will reach US$2.4 trillion by 2030, half of which will come from external funding and the rest from public and private sources in those countries.
According to the report, the current investment is about $500 million. He added that the largest surge should come from the private sector, both domestic and foreign, while annual inflows from development banks should increase three times. Low-interest loans that offer better conditions than the market should also be increased.
“Unleashing significant climate finance is key to solving current development challenges,” said Vera Songwe, co-author of the report.
“This means that countries should have access to low-cost and sustainable financing from the multilateral development banks to mobilize private sector investment and charitable donations,” she added.
On Wednesday, delegates at the climate summit in Egypt are expected to deal with financing issues.
The report also called for grants and soft loans from developed countries to double from $30 billion annually to $60 billion by 2025.
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