Dr. Mohieldin: Reforming Global Finance System is Necessary to Achieve Just Green Transitions

Dr. Mahmoud Mohieldin, UN Climate Change High Level Champion for Egypt and UN Special Envoy on Financing 2030 Sustainable Development Agenda, said that reforming the global finance system and adjusting the policies of IFIs and MDBs have become necessary to achieve just green transition.

This came during his participation in the meetings of 2023 Forum of the UNFCCC Standing Committee on Finance (SCF) on Financing Just Transitions that takes place in Bangkok, with the participation of Ambassador Mohamed Nasr, Director of the Department of Climate Change, Environment and Sustainable Development at the Ministry of Foreign Affairs, Katarzyna Kowalska, SCF Member, Jiravat Ratisoontorn, Deputy Secretary General of Office of Natural Resources and Environmental Policy and Planning at Ministry of Natural Resources and Environment of Thailand, Simon Stiell, Executive Secretary of UNFCCC, Hamza Ali Malik, Executive Secretary of UNESCAP, Chihoko Asada-Miyakawa, Assistant Director-General and Regional Director of International Labour Organization, and a number of international organizations officials, academics and economists from many countries.

Mohieldin stated that the process of equitable transition requires the availability of fair and adequate financing, the implementation of technological solutions, and the change of ideas and policies of all actors in climate and development action, adding that these tools are important to achieve SDGs as a whole, including the goal of confronting climate change.

Mohieldin stressed the importance of the holistic approach that puts climate action and its financing within the framework of SDGs, explaining that climate finance is a development finance and both integrate and do not contradict.

“The current financing system does not contribute as required to the desired rapid implementation of green transitions.” Mohieldin said, explaining that the current financing of climate and development action is insufficient, inefficient and unfair.

The climate champion pointed out the urgent need for a more effective global financing system that is more capable to deal with the requirements of climate and development action.

“There is a need to maximize the role of existing IFIs and MDBs by increasing their capital and adopting more effective policies for concessional financing and providing technical support.” Mohieldin stated, adding that these new policies will encourage private sector to participate more in financing and implementing climate projects.

Mohieldin confirmed the need to reduce dependence on debt as a financing method of climate and development action by activating debt reduction mechanisms, foremost of which is debt swaps for investment in nature and climate, operating carbon markets, and increasing public and private sectors partnerships.

He called for strengthening climate action at four levels: the global level, the regional level that is witnessing progress through the initiative of the five regional roundtables, the national level through the continuous updating of NDCs in a way that is integrated with the international effort, as well as the local level by involving all domestic actors in the implementation of development projects with technological and green components.