Our world is going through several challenges in 2022, triggered by the Russia-Ukraine conflict, the two-year-long covid-19 pandemic, the ongoing global recession, and the record-breaking surface temperature. Climate change has been a serious concern and threat in several countries. While worldwide organizations are taking preventive measures to address the issue, climate finance has come up with a new strategy to make a change in the way the world has been working.
The goal of becoming climate neutral by 2050 requires structured planning and huge funding from both private and public sectors. The collection of funds drawn from private, public, and alternate sources to reduce greenhouse gas emissions, and adapt eco-friendly projects to address climate change is known as climate finance. To take climate action, finance is an important aspect of collecting resources to make it possible, and reduce the effects of climate change.
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Climate Change: A Major Threat
Over the years, the use of excess greenhouse gases has led to severe climate change in several parts of the world. While over nineteen countries are presently experiencing a change in climatic conditions, six countries are the highest emitters of greenhouse gases and require immediate action to prevent any further destruction.
The United Nations Environment Programme works on climate finance in a different way. The UNEP works mainly to support private financial institutions such as investors, banks, and insurers mainly to mitigate and understand the risks of climate change, take up commercial projects to take climate actions, and take necessary measures to align portfolios with adaptation, and mitigation objectives of the Paris Agreement.
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Climate Change Conference (COP 27) 2022
The Paris Agreement was held on the 12th of December, 2015 at COP 21 (Climate Change Conference). The Climate Change Summit by UN COP 27 was held in Egypt and was opened with a warning that “Our planet is sending distress signal”. In a recent report released by the UN, Secretary-General Antonio Guterres stated that the past eight years have been warmed on the records. More than a hundred and twenty leaders around the world were expected to attend the Climate Change Conference (COP 27) held at the red-sea resort of Sharm-el-Sheikh.
The president of COP 27, Sameh Shoukrey who is the Foreign Minister of Egypt requested the global leaders not to keep the food, and energy crises caused by the Russia-Ukraine of conflict come in the way of taking climate action. He added, “it is important for everyone present at the summit to showcase the magnitude of challenges that the countries are facing and their best action to resolve the issue”. The latest report by the World Meteorological Organization of the United Nation shared the needed action to the present climatic conditions.
Mr. Guteres also presented a video, a Global Climate Report 2022 at the Climate Change Conference where “scientists made an estimation of the rise in global temperatures which were now increased by 1.15C since before pre-industrial times. They also mentioned that the last eight years were tracked to be the warmest on records”. The report also warned about several other side effects of climate change that include glacier mass losses, rise in sea level, and heatwaves breaking past records.
The arctic ice will decrease, causing the sea levels to rise, and natural disasters such as cyclones, floods, and droughts will increase in number due to climate change. In 20212, the drought in the United States caused a huge economic loss rounding up to twenty billion dollars causing the worst and most costly drought in the history of the country. Therefore, countries must step up and start taking climate action to turn the wheels.
Climate Change Solution With Climate Finance
According to reports, developing countries are required to secure one trillion dollars in external financing to work with rich countries, banks, and development banks for climate action. This report was released after the climate change conference in Egypt, and shares that the funding is required to improve resilience, restore nature, reduce emissions, and deal with the damage caused due to climate change.
The report commissioned by the previous and present climate conference hosts Britain and Egypt shares that “the world needs a new roadmap and a quantum leap on climate finance that will raise the one trillion dollar fund in external finance required by 2030 for the developing countries except for China”.
By 2030, the annual investment for developing countries might reach $2.4 trillion, while half the fund might come from external financing, the rest will be arranged from the public and private sectors. The report also showed that the present investment stands at five hundred million dollars.
At COP 27, Namibia announced that it has managed to secure 540million euros in climate finance from the European Investment Bank, and Dutch Government. Being one of the world’s less populated countries, receiving the majority of the sunlight, Namibia wants to generate green hydrogen and wants to become a renewable energy hub in Africa.
As said by one of the authors of the report, Vera Songwe, “Unlatching enough climate finance is the key to resolving the development challenges faced by the countries today”. Climate change is a major threat in several countries and immediate attention is to keep the world safe from unpredictable natural calamities.