Statement from International Monetary Fund Managing Director, COP28 President-Designate, President of the World Bank Group, and UN Special Envoy for Climate Action and Finance
IMF News, June 29, 2023
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- Statement from International Monetary Fund Managing Director, COP28 President-Designate, President of the World Bank Group, and UN Special Envoy for Climate Action and Finance
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- Published: June 29, 2023
Overview
- Press Release No. 23/246
- June 29, 2023
- Event: High-level roundtable co-chaired by Dr. Sultan Al Jaber (COP28 President-Designate), Kristalina Georgieva (Managing Director, IMF), Ajay Banga (President, World Bank Group), and Mark Carney (UN Special Envoy for Climate Action and Finance; Co-Chair, GFANZ).
- Location: Palais Brongniart, Paris, France.
- Context: Roundtable held as part of the Summit for a New Global Financing Pact to identify priority actions to mobilize private climate investment in emerging markets and developing countries (EMDCs), with emphasis on delivering near-term results in the runup to COP28.
Key findings and observations
- Current climate investment into EMDCs remains insufficient to meet the goals of the Paris Agreement.
- MDBs and other development finance should be used catalytically to:
- Unlock local and international private finance.
- Enhance technical capacity to build a pipeline of bankable climate projects.
- Implement public policies to establish an enabling environment for investment in the green transition.
- Private capital is identified as essential to close the financing gap for transitioning to net zero in EMDCs.
- Transition finance needs multi-stakeholder action to position it as an investment opportunity that supports sustainable low-carbon growth in EMDCs and creates necessary market and policy conditions.
Agreed actions and commitments from the roundtable
- Co-Chairs intend to consider the Working Group’s proposed recommendations from the Working Group focused on Increasing Investment in Sustainable Infrastructure in Emerging and Developing Markets in preparation for the Summit.
- The IMF will:
- Continue to share lessons learned from early Resilience and Sustainability Trust (RST) programs.
- Use the roundtable to share experiences going forward, recognizing the importance of a country’s policy environment for enabling investments into climate transition.
- The COP28 Presidency will:
- Ask MDBs and specialized climate funds to take action on simplifying and streamlining access to climate finance.
- Ask MDBs and specialized climate funds to implement practical new ways of working together as a system with objective of speeding and scaling up private financing of climate transition in EMDCs.
- Participants will:
- Continue to push forward on institution-specific priorities for capital mobilization towards climate goals discussed during the roundtable.
- Share updates on progress in subsequent roundtables.
- Co-Chairs agreed to organize additional roundtable discussions in 2023 to further solutions from the Summit in Paris through to COP28.
- The Co-Chairs agreed to include discussion of early proposals surfaced by the World Bank Group’s Private Sector Investment Lab in the next roundtable.
Initiatives and institutional developments highlighted
- Workstreams informing the conversation:
- Just Energy Transition Partnerships (JETPs).
- IMF’s Resilience and Sustainability Trust (RST).
- Various World Bank Group initiatives.
- World Bank Group launched the Private Sector Investment Lab, to be co-chaired by Mark Carney and Shriti Vadera of Prudential.
Selected quotes from participants
- Dr. Sultan bin Ahmed Al Jaber (COP28 President-Designate):
- “Climate finance is nowhere near available enough, accessible enough and affordable enough – especially for countries in the Global South. To make finance more available, we need to figure out how to attract much more private capital into the investment pool. Private capital is the force multiplier that can really change the game when it comes to effective climate finance. To make financing more accessible, we need to simplify, speed up, and standardize access to climate funds across international financial institutions and specialized funds. And to make finance more affordable, we must drive transparency and price discovery. We must give all market participants the tools and mechanisms that narrow the gap between perceived risk and actual risk when it comes to investing in emerging and developing economies. We need to shift the narrative that views climate finance as a burden and recognizes it as an economic opportunity.”
- Kristalina Georgieva (IMF Managing Director):
- “Given the huge financing required to deliver the transition to green and resilient economies, it’s vital that we work in partnership to accelerate investment flows— particularly to emerging and developing economies. Everyone has a role to play—multilateral institutions, national authorities, and the private sector—each using their expertise and comparative strengths. Working together we can harness the power of private capital in the fight against climate change.”
- Mark Carney (UN Special Envoy on Climate Action and Finance; GFANZ Co-Chair):
- “The transition to net zero must be global, and the scale of investment required in emerging and developing economies can’t be met with public money alone. GFANZ continues to work closely with MDBs, the IMF, and governments as they develop and scale new approaches to address longstanding barriers to private investment, including through the World Bank’s Private Sector Investment Lab, launched today. We appreciate the COP28 presidency for taking a practical approach for moving this agenda forward, and we look forward the progress that must be delivered this year to ensure that investment can flow to where it’s needed most.”
- Ajay Banga (President, World Bank Group):
- “Governments, multilateral institutions, and philanthropies aren’t enough to make adequate progress toward climate and poverty goals in emerging markets and developing countries. The scale of our challenge requires the private sector to play a significant role alongside the World Bank Group and other development institutions. For years, we have tried – and fallen short – to mobilize meaningful private investment in these markets. Given the urgency and scale of our intertwined challenges, we must try a new approach. The Private Sector Investment Lab – co-chaired by Mark Carney and Shriti Vadera – is a concrete step in a broader effort to develop, and rapidly scale, solutions that address the barriers preventing private sector investment in emerging markets.”
Contact and media
- IMF Communications Department, MEDIA RELATIONS
- PRESS OFFICER: Maria Candia Romano
- Phone: +1 202 623-7100
- Email: MEDIA@IMF.org
- @IMFSpokesperson
International Monetary Fund — Press Release No. 23/246, June 29, 2023.