G20 vows to 'scale up green finance' in collaboration with business
The G20 has highlighted the necessity to "scale up green financing" in partnership with the private sector in order to shift trillions of dollars from dirty to clean investments.
On the final day of the G20 China summit yesterday (5 September), the group’s annual communique welcomed the 'G20 Green Finance Synthesis Report’ submitted by the Green Finance Study Group (GFSG) designed to mobilise private capital for green investment.
The document also reaffirmed a commitment to continued investment in sustainable energy projects and ratifying the Paris Agreement “as soon as national procedures allow”.
The report reads: “We recognise that, in order to support environmentally sustainable growth globally, it is necessary to scale up green financing. The development of green finance faces a number of challenges, including, among others, difficulties in internalising environmental externalities, maturity mismatch, lack of clarity in green definitions, information asymmetry and inadequate analytical capacity, but many of these challenges can be addressed by options developed in collaboration with the private sector.”
‘Excuses running out’
The focus on green finance has been broadly welcomed from key finance, business and other stakeholders, but the lack of a date to phase out fossil fuel subsidies disappointed many.
Last week, edie reported that financial support for fossil fuel production remains widespread within G20 economies, despite an earlier pledge by the institution’s leaders to phase out the ‘inefficient’ subsidies.
Responding to the G20 communique publication, Overseas Development Institute research fellow Shelagh Whitley said that ‘excuses are running out’ on phasing out fossil fuels and highlighted that “G20 countries are continuing to fund fossil fuel production by $444bn, and next year’s summit in Germany will be the last chance to agree an end date for such subsidies”.
The US and China marked a major breakthrough in the battle to limit global warming by officially ratifying the Paris Agreement over the weekend - now the pressure is mounting for the UK to rapidly follow suit.
Politicians and campaign groups alike are now calling on Prime Minister May to ratify the climate deal, with Greenpeace organising a petition that has gathered more than 100,000 signatures.
Not-for-profit organisation E3G senior associate Ruth Davis said: “With the US and China confirming their commitment to the Paris climate agreement, and robust language on green finance in the G20 communique, it is clear that the world’s major economies see their future growth as low-carbon.
“This is the perfect moment for Theresa May to show that the UK will not be left behind, economically or diplomatically, by this new reality; and that her Government intends to capitalise fully on the UK’s proud record of climate leadership stretching back over decades.
“As well prompt UK ratification of the Paris Agreement, top of her agenda should be confirming a date for phasing out the UK’s remaining coal-fired power stations and setting out an ambitious industrial strategy that will enable UK firms to take advantage of rapidly expanding clean technology markets.”