Saturday, 18th May, 2024
Saturday, 18th May, 2024

Finance ministers highlight fiscal, sustainability pressures at Climate Adaptation Summit

The Vulnerable 20 Group of Finance
Ministers (V20) today highlighted mounting pressures to their
economies amidst growing costs from worsening climate
disasters and the Covid-19 pandemic during the inaugural of
Global Climate Adaptation Summit.

The V20 is seeking support for new climate investments to
exceed the low-bar $100 billion target for international
climate finance that the group can deploy for adaptation, low-
carbon infrastructure and resilience projects in their
respective economies, said a press release.

“The world economy is at a historic crossroads. Covid-19 has
shown the inadequacy in our preparation. We cannot allow such
an occurrence to repeat in regards to climate change
impairment,” said Bangladesh Finance Minister AHM Mustafa
Kamal, who is also a member of the V20.

Kamal said, “If we combine our persistent endeavors, certainly
we can overcome this impairment and become far more active in
constructing a resilient global economy together. We have to
accept that the global response has been too little, too late.
We must absolutely see all donors balance their climate
finance and place adaptation on a level footing with reducing

While the Covid-19 pandemic has sparked a new sense of urgency
to build better infrastructure and social protections, the V20
group is concerned that availability of capital for climate
action still fall short of requirements to achieve the 1.5°C
threshold of the Paris Climate Agreement.

Since the agreement took effect, it became clear that growing
exposure to climate risks creates instability in the world
economy given that V20 countries are engines of global growth
with consistently high average rates of economic expansion
exceeding 5 percent per year.

The release said that every economy should review all macro
signals for the full range of climate risks. IMF surveillance
should endeavor to monitor climate risks globally. Moreover,
financial protection against climate and disaster risks is
almost non-existent among most vulnerable communities.

International support can develop financial protection such as
the V20-led Sustainable Insurance Facility, which is part of
the InsuResilience Global Partnership target, to reach
sufficient market scale for insurance and related industries.

Aiyaz Sayed-Khaiyum, Attorney-General and Minister for Economy
of Fiji and member of the V20 added, “We echo the call of our
V20 counterparts for an Accelerated Finance Mechanism to
enable off-balance sheet de-risking tools to reduce the cost
of capital of adaptation and renewable energy solutions,”

“The response to this pandemic can mark a turning point to the
vulnerable world with real change that delivers real
resilience, gains in well-being and sustainable development.”
added the Fijian Minister.

Last month, the group released its Climate Prosperity Plans
program under the Bangladesh Presidency. These national plans
will outline strategic investment frameworks to mobilize
international financing for implementing renewable energy,
adaptation and resilience projects.

The Climate Prosperity Plans also include an analysis of jobs
created, cost savings are a result of disaster reduction,
opportunities for foreign direct investments as well as
economic and social benefits that can be realized if
international climate finance is made available.

Formed in 2015, the V20 Group of Finance Ministers is a
dedicated cooperation initiative of economies systematically
vulnerable to climate change.

It is currently chaired by the People’s Republic of
Bangladesh. The V20 membership stands at 48 economies
including Afghanistan, Bangladesh, Barbados, Bhutan, Burkina
Faso, Cambodia, Colombia, Comoros, Costa Rica, Democratic
Republic of the Congo, Dominican Republic, Ethiopia, Fiji, The
Gambia, Ghana, Grenada, Guatemala, Haiti, Honduras, Kenya.

The V20 member countries also include Kiribati, Lebanon,
Madagascar, Malawi, Maldives, Marshall Islands, Mongolia,
Morocco, Nepal, Niger, Palau, Palestine, Papua New Guinea,
Philippines, Rwanda, Saint Lucia, Samoa, Senegal, South Sudan,
Sri Lanka, Sudan, Tanzania, Timor-Leste, Tunisia, Tuvalu,
Vanuatu, Vietnam and Yemen.

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