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Fighting climate change: the global south needs €2.4 trillion a year

Fighting climate change: the global south needs €2.4 trillion a year

Status: 08/11/2022 2:13 PM

An expert report published in COP27 estimates the annual cost of combating the climate crisis in emerging and developing countries at €2.4 trillion. The industrialized countries must bear a large part.

Developing and emerging countries in the so-called Global South will need approximately €2.4 trillion annually until 2030 to combat the effects of climate change and implement the transition to a more sustainable and climate-friendly economy. This is the summary of a report by economists and environmentalists published as part of the current global climate conference COP27.

The analysis was jointly carried out by Egypt, the current host country of COP27, and the United Kingdom, which hosted the United Nations climate conference last year.

“The Decisive Contract”

In the report, the authors called for a “comprehensive and rapid investment push” in order to promote “strong and sustainable development” in the countries concerned. These investments can fuel the growth and transformation of “key systems” such as energy or transportation, water use and agriculture. In their analysis, the experts spoke of a “critical decade” in order to prevent “the massive and irreversible damage from climate change and biodiversity loss.”

Nearly 50 experts participated in this Climate Finance Report Contributed. It was chaired by Vera Songwe, Economist and Executive Secretary of the United Nations Economic Commission for Africa, and British economist Nicholas Stern. Stern is president of the Grantham Research Institute, which studies climate change and the environment. Ammar Bhattacharya of the US think tank Brookings Institution chaired the group of experts as executive secretary.

The report covers emerging and developing countries with the exception of China. The Chinese economy is the second largest in the world and is advanced in many ways.

Investing in energy, agriculture and against climate damage

According to the expert group, the annual amount of 2.4 trillion euros should be raised for three main points: on the one hand to switch to clean and affordable energy, and on the other hand to deal with climate damage caused by extreme weather events such as drought or floods. Developing countries are much more vulnerable to this than industrial countries. And third, to develop sustainable agriculture.

Industrialized countries will collect a trillion

According to the analysis, about 1 trillion euros should be raised annually by industrialized countries as well as by foreign investors and multilateral development banks. Investments in emerging and developing countries, excluding China, are currently about $500 billion.

“Rich countries must realize that it is in their fundamental interest to invest in climate action in emerging and developing countries,” said British economist Stern. Additionally, given the effects of these countries’ current and past high greenhouse gas emissions, it is “also about fairness”.

The remaining amount of about $1.4 trillion must therefore be provided by private or public investors within developing and emerging countries.

Billions of Aid Agreed to South Africa

Such a move was already agreed to for greater financial support for the Global South at COP27: Germany and other industrialized countries pledged billions of dollars in aid to South Africa so that the country could turn its back on coal.

The $8.5 billion (about 8.5 billion euros) aid planned by Germany, Great Britain, France, the European Union and the United States, among others, will be used to decommission coal-fired power plants and promote renewable energy, she said in a statement issued in Sharm El-Sheikh.

Germany pledges more than one billion euros

Industrialized nations agreed to South Africa’s plan to move away from coal. The statement quoted US President Joe Biden as saying in the statement that the support program will help “the clean energy boom in the South African economy.”

According to the Federal Ministry of Development in Berlin, Germany has already provided 700 million euros for South Africa’s exit from climate-destroying coal and pledged another 320 million euros in the recently completed negotiations.

According to the information, Germany and South Africa are cooperating, among others, in the construction of solar and wind power plants and in green electricity transmission lines. These investments should create new jobs, especially in coal regions. Germany also supports retraining programs for former coal workers and training in the professions most needed in the energy transition.

Partnership launch in Glasgow

South Africa – the largest economy on the African continent – relies on coal for 80 percent of its electricity generation. The developed country partnership with South Africa on moving away from coal is a form of cooperation known as the JETP for short.

JETP was launched last year at the United Nations Climate Conference in Glasgow to enable a faster and socially equitable transition for developing and emerging countries to a climate-friendly economy.