Outcomes on climate finance from G7 Leaders Summit
This weekend the G7 Leaders Summit took place. The G7 Communique is here, and there were several outcomes on climate action. Below this email is the CSO press reaction to the Summit, The main outcomes on climate finance include:
- The Communique states "we commit to each increase and improve our overall international public climate finance contributions for this period and call on other developed countries to join and enhance their contributions to this effort". However, as a group, the G7 didn't announce a commitment to a collective doubling as a group. However, Prime Minister Johnson, and President Biden announced a ' Build, Back, Better' initiative for Africa, South East Asia. Not much information has been shared yet, but the initiative doesn't seem bad. However, it was announced as a finance initiative, and so has been unhelpfully framed as a contribution to global climate finance goals. A taskforce will be set up to determine what this initiative can achieve, however, there's no information on the substance of the initiative.
- The Communique also calls on Multilateral Development Banks (MDBs) to take greater action on climate finance. "We welcome efforts of the MDBs to scale up their climate and nature finance, urge them to mobilise increased finance including from the private sector, and call on them, Development Finance Institutions (DFIs), multilateral funds, public banks and relevant agencies to publish before COP26 a high-level plan and date by which all their operations will be fully aligned with and support the objectives of the Paris Agreement and the multilateral environmental agreements we support."
- Countries also committed to providing $2bn for the World Bank's Climate Investment Funds (CIF) for its Accelerating the Coal Transition and Integrating Renewable Energy programs this year. The Communique states that ''These concessional resources are expected to mobilize up to $10 billion in co-financing, including from the private sector, to support renewable energy deployment in developing and emerging economies''. CSOs have been calling for the CIF to have closed by now and for countries to focus on providing climate finance to the Green Climate Fund (GCF).More information is available here.
Individual country announcements made at the Summit:
- Canada announced a doubling of its international climate finance contributions for the 2021 - 2025 period. Canada's baseline for climate finance was already low, so this doubling is more symbolic, rather than a truly significant amount. However, Canadaian CSOs have said that this makes climate finance an important foreign policy priority for Canada for the next five years, and that the doubling means that Canada is getting closer to it's fairshare of the existing, global $100bn USD goal. Canada will also increase the percentage of grants provided, as well as adaptation finance, although it's not clear how much adaptation finance will be provided.
- Germany increased its climate finance from approx 4.3bn EUR to 6bn EUR by 2025 at the latest. This is not a full doubling, but if the Green party wins a significant amount of seats in the upcoming autumn elections then German CSOs are speculating that this may lead to Germany doubling its climate finance to 8bn. However, Oxfam Germany has highlighted that Germany's climate finance announcement at the G7 may be based on providing more loans, using a dubious baseline for increasing climate finance, and so cautions public CSO support for the announcement.
- Japan committed to maintain its current climate finance commitment, and to increase its share of adaptation finance. Japan's current commitment is a total of $3bn USD, and is the sum of $1.5bn USD from the Initial Resource Mobilisation (IRM) and $1.5bn USD from the first GCF replenishment round (GCF-1).
- Significantly, country announcements at the Summit on coal, mean that China is now the only big coal financer in the world.
Next steps on implementation
- Road to COP26 document is meant to outline some of the implementation plans for the climate action points in the Communique - this is meant to come out after the Summit
- None of the announcements made represent significant contributions to achieving the climate finance goal. CSOs in G7 countries have already started working to share their plans on what their governments and ministries need to do to actually implement the outcomes in the Commonique. Their focus now is on holding their countries to account.
Useful resources/ reports that came out around the G7:
- Quick overview of why the G7 was so important for climate action: https://eciu.net/blog/2021/g7-what-to-expect-what-it-means-for-cop26
- UN-backed report finds no G7-based stock exchange indices align with Paris climate goals: https://news.un.org/en/story/2021/06/1093822
- British CSOs engaged in a lot of activities (see video on CSO activities at the bottom of this BBC article). Below this email is the C7 (Civil Society 7) press release.