Comment créer des synergies entre la finance pour le développement et la finance climat

Cet article a été rédigé dans le cadre du rapport « Think20 India 2023: Critical, Constructive, Conclusive ». Lire le rapport complet ici.

 

Le développement durable et le changement climatique sont deux questions urgentes et interconnectées que les pays se sont engagés à traiter au niveau international. L’Agenda 2030 pour le développement durable, qui s’articule autour des 17 objectifs de développement durable (ODD), dont l’action contre le changement climatique, a été adopté par l’Organisation des Nations unies (ONU) en 2015. La même année, l’Accord de Paris a été adopté par les parties de la Convention-cadre des Nations unies sur les changements climatiques. Ces deux instruments comportent des objectifs mondiaux et nationaux précis à moyen et à long terme qui sont encore loin d’être atteints. Cet article présente quelques pistes pour favoriser une approche intégrée.

 

Texte uniquement disponible en anglais

Progress towards SDGs and climate objectives is hindered by the same crucial challenge—the sheer size of the funding gap. Significant investments are needed to achieve the SDGs and climate goals. Yet experts agree that current financial flows towards these objectives are hugely inadequate. The financing gap to achieve the 2030 Agenda, which increased by 56 percent following the COVID-19 outbreak, reached US$3.9 trillion in 2020. And when it comes to achieving climate objectives, only about 16 percent of the estimated US$3.8 trillion needed annually through 2025 are currently being met. Additionally, international adaptation financial flows to developing countries are five to ten times below estimated needs, and the gap is widening, with annual adaptation needs estimated at US$160-340 billion by 2030 and US$315-565 billion by 2050. If nothing is done, the situation is expected to worsen in the current challenging macroeconomic conditions.

 

The implications of this funding gap are compounded by the fact that costs are unevenly borne by countries. Climate change impacts are disproportionately borne by developing countries, particularly least developed countries and small island developing states (SIDS) . These countries are already paying for losses and damages due to climate disasters, estimated at over US$500 billion between 2000-2019 for the 55 most vulnerable countries. With increasing climate impacts, needs for adaptation finance are expected to exceed 1 percent of GDP in low-income and developing economies, and up to 20 percent of GDP for SIDS. Failure to halt climate change will, thus, negatively affect the achievement of the SDGs for developing countries, while failure to advance on other SDGs will increase their vulnerability to climate impacts and exacerbate the climate crisis.

 

Risks of a disjointed approach to climate and SDG finance

The SDGs and climate are interrelated, yet they have been tackled in a disjointed manner for too long, prompting competition for financial resources. While the SDG framework promotes an integrated approach, the focus of financial flows has been on one SDG at a time, and mostly on ‘bankable’ activities. This is also the case across climate objectives, with over 90 percent of climate finance going to mitigation, despite growing needs and an increasing gap in adaptation finance. And although the commitment of developed countries was to provide ‘new and additional’ finance for developing countries to tackle climate change, only 6 percent of climate finance provided from 2011 to 2018 is considered as new and additional to official development assistance. Filling the climate finance gap cannot continue to come at the expense of the SDGs, or vice versa.

 

Continuing with this disjointed approach threatens the achievement of the SDGs and climate objectives, increasing the risk of negative side-effects and jeopardising potential co-benefits across objectives. For instance, industrialisation projects targeted by SDG-9 may lead to technological lock-in that may be harmful to climate objectives, as in the case of building industrial plants reliant on fossil gas instead of using renewable and clean energy sources. Similarly, actions to adapt to climate change may have detrimental impacts on efforts to reduce inequality (SDG-10) if adapted infrastructure is only built in wealthy areas. In contrast, massive investments in renewable energy can lead to improved energy access and a reduction of energy poverty, thereby contributing to building sustainable territories (SDG-11), increasing opportunities for economic growth (SDG-8), and reducing inequalities. Considering these risks and opportunities, leaving the silo perspective behind by moving towards an integrated approach in the way SDGs and climate are financed is a necessary step forward.

 

Towards an integrated approach

Recent initiatives bring sustainable development and climate objectives together at the policy level; these are a good starting point but do not provide a comprehensive perspective on funding and financing needs.

 

 

Beyond the policy level, just energy transition partnerships (JETPs) are an important step to leave the silo approach to project financing, but still miss the mark given their sectoral focus. Initiated in 2021, JETPs are a funding model designed to support the phase out of fossil fuels in developing and emerging economies while tackling the social consequences of the transition, notably addressing issues such as job losses in highly emitting sectors. JETPs typically lay out priority investment requirements and match them with funding in various forms. Pioneered in South Africa and followed by Indonesia and Vietnam, JETPs recently expanded to Senegal and are expected for other countries such as India. Yet the scope of JETPs does not allow for a comprehensive overview of the amounts and types of financing needed for the achievement of climate and sustainable development objectives.

 

Developing a national financing plan for the transition to achieve climate and development targets will help countries channel financial resources where most are needed rather than where it is easiest (for instance, investments in sustainable agriculture versus in renewables). A financing plan for the transition will point at financing needs and public policies to achieve objectives. It will also point at investment needs from private entities and levers to trigger them, and will indicate how much funding is needed from international lenders. A financing plan can be developed based on green budgeting initiatives or integrated national financing frameworks, and will benefit from being complemented by other tools such as climate finance landscapes or economic modelling including climate risks.

 

Role of international financial institutions in synergising climate and SDG finance

But countries cannot make it on their own. Synergising climate and SDG finance will require efforts from international financial institutions (IFIs). The broad development mandate of IFIs and local public development banks and the required additionality of their intervention (i.e., only funding projects that are either too risky or not profitable enough to attract private finance) make them key players in synergising SDG and climate finance. Their contribution to countries, through financial or non-financial support (such as capacity building, tools development), should be demand-driven, with a long-term perspective, and based both on national development and climate priorities maximising opportunities for co-benefits, ideally following national financing plans. Additionally, IFIs and public development banks should systematically strive for real economy impacts and deflect from projects with limited potential for change.

 

Ongoing discussions on the reform of the international financial architecture are the perfect opportunity to move towards an integrated approach for climate and SDG finance. International efforts in several forums can foster the required changes to advance in this direction. The Summit for a New Global Financial Pact, held in Paris in June 2023, was the opportunity to stress the need “to address joint nature, climate, and development challenges through increased global cooperation”. Upcoming international agenda milestones, such as the Finance in Common Summit, the G20 Summit, the UN SDG Summit, the International Monetary Fund and World Bank annual meetings, and COP28 need to keep up the momentum and propose real-economy, technical solutions to ensure (i) that countries are equipped with a long-term integrated view on their climate and development needs, and (ii) that development institutions offer relevant, long-term, and demand-driven support to countries.

Contacts I4CE
Dr. Louise KESSLER
Dr. Louise KESSLER
Directrice de programme – Outils de pilotage, Financement de la transition Email
Diana CÁRDENAS MONAR
Diana CÁRDENAS MONAR
Chercheuse – Outils pour le financement de la transition à l'international Email
Chloé BOUTRON
Chloé BOUTRON
Chargée de recherche – Outils pour le financement de la transition à l'international Email
Sarah BENDAHOU
Sarah BENDAHOU
Chercheuse – Financement du développement Email
Pour aller plus loin
  • 09/02/2024 Tribune
    Climat : les institutions financières publiques, en première ligne de la transformation du système financier

    2 400 milliards de dollars par an. Ce montant qui fait tourner la tête est celui que nous devons collectivement réussir à mobiliser jusqu’en 2030 pour financer la transition climatique dans les pays du Sud, hors Chine. Une part importante de ce financement devra provenir de ressources domestiques : environ la moitié pourrait ainsi être mobilisée par l’amélioration des recettes fiscales nationales ou le recours aux marchés nationaux de capitaux. Le reste proviendrait de sources internationales, publiques et privées.

  • 01/12/2023
    COP28: It’s money time !

    La COP28 de Dubaï s’ouvre dans un contexte climatique inquiétant. Pour la première fois, le seuil d’augmentation de la température de 2°C par rapport à l’ère préindustrielle a été dépassé sur une journée, et un rapport publié par l’ONU cette semaine nous alerte sur le fait que les politiques actuelles placent la planète sur une trajectoire de réchauffement de 2,9°C, et que les chances de maintenir l’augmentation à +1.5°C ne sont plus que de 14%. Les résultats du premier Global Stocktake, le bilan mondial de l’action des pays depuis l’Accord de Paris, seront publiés à la COP et devraient confirmer l’urgence d’infléchir les trajectoires d’émissions de gaz à effet de serre.

  • 29/11/2023 Billet d'analyse
    Finance climat : multiplier les chiffres ne suffit pas à résoudre l’équation

    Une grande partie des discussions de la COP28 portera sur l’objectif de 100 milliards de dollars par an décidé à Copenhague pour soutenir les investissements climatiques dans les pays du Sud, et sur le nouvel objectif de financement du climat destiné à le remplacer. Cependant, tout en gardant les yeux rivés sur les volumes mis sur la table, nous devons également nous pencher davantage sur l’impact de chaque dollar dépensé. Il est essentiel d’identifier et d’exploiter la valeur ajoutée de chaque acteur économique afin d’éviter les chevauchements et de maximiser les synergies. Trois types d’acteurs ont un rôle central à jouer dans le changement de paradigme : les gouvernements, les institutions financières publiques et les institutions financières privées.

Voir toutes les publications
Contact Presse Amélie FRITZ Responsable communication et relations presse Email
Inscrivez-vous à notre liste de diffusion :
Je m'inscris !
Inscrivez-vous à notre newsletter
Une fois par semaine, recevez toute l’information de l’économie pour le climat.
Je m'inscris !
Fermer