A new framework for climate finance needs to be comprehensive and unlock a “supercharged” stream of private capital, Cop28 President-designate Dr Sultan Al Jaber has said.
His remarks came during a meeting of the The Independent High-Level Expert Group on Climate Finance, who gathered at Abu Dhabi Global Market on Tuesday and Wednesday to discuss setting up a new framework for international climate finance.
The fresh road map will include addressing debt distress in vulnerable countries, and the role of the private sector in delivering increased finance.
The attendees said that private finance flows need to grow faster to meet the $2.4 trillion in total investment estimated to be required annually by 2030 to address climate change in emerging markets and developing economies.
"For too long, climate finance has divided the international community and held back progress in tackling climate change and supporting countries most impacted by it,” said Dr Al Jaber, who is also the Minister of Industry and Advanced Technology.
“But climate finance is the issue that lies at the core of the Cop28 agenda because finance is how we transform goals into reality,” he said.
Cop28 is scheduled to be held in Dubai from November 30 to December 12, and is expected to be the most inclusive Cop conference yet.
The Cop28 presidency has named fixing climate finance one of its four priority action pillars, alongside fast-tracking the energy transition, ensuring full inclusivity, and addressing lives and livelihoods.
“All forms of finance must be made more available, more accessible, and more affordable. [Multilateral development banks] must be adequately capitalised and provide much more concessional finance to lower risk and bring more private capital to the table,” Dr Al Jaber said.
The climate finance framework will be designed to guide all institutions, including UN agencies, the International Monetary Fund and the World Bank.
All the attendees agreed that the primary focus of their work would be to rapidly increase international climate finance between now and the end of the decade to support emerging markets and developing economies.
“The IMF is committed to ensuring climate policy support and finance are reaching those most in need ... We look forward to partnering with all stakeholders in the lead up to Cop28 and working to drive stronger partnerships between the public and private sector for climate success," said Kristalina Georgieva, managing director of the fund.
Investment in renewable energy needs to double to more than $4 trillion by the end of the decade to meet net-zero emissions targets by 2050, according to the International Energy Agency.
The IEA’s stated policies scenario (Steps), which is based on the latest policy settings worldwide, expects clean energy investment to rise to slightly more than $2 trillion by 2030.
Dr Sultan Al Jaber says this is the decade to provide clean energy the world needs
Developing countries are facing a massive investment shortfall in the renewables sector and require debt relief to create fiscal space that supports clean energy transition to meet their climate and sustainable development goals, according to the UN Conference on Trade and Development.
They require about $1.7 trillion per year in the clean energy sector but only managed to attract foreign direct investment worth $544 billion in 2022, the Unctad said in its World Investment Report last month.
"We are all in no doubt of the urgency of the challenges, of the scale of the problems that we must tackle, and of the global action necessary to rise to these challenges," said Nicholas Stern, co-chair of the IHLEG.
Dr Vera Songwe, co-chair of the IHLEG, added: "Over the last few months every corner of the world has been hit by a climate event. We must act fast, collectively and at scale to turn these climate disruptions into a growth opportunity for people and planet."
