Mohieldin: Sufficient & Fair Finance is Essential to Achieve Climate Targets

UN Climate Change High Level Champion for Egypt and UN Special Envoy on Financing 2030 Sustainable Development Agenda, Mahmoud Mohieldin, said that the world has reached a critical stage of climate change with the clear increase in the warming rates in some regions, including the Middle East and some regions in Africa, stressing the importance of mobilizing sufficient and fair finance as the first and most important step to achieve the necessary goals of reducing emissions, adapting to climate change, and dealing with the loss and damage resulting from the phenomenon.

Mohieldin's remarks came during his participation in the meeting of the Group of Friends on Climate and Security, chaired by the Permanent Missions of Morocco and France to the United Nations, which discussed the future of climate and development finance, days before COP28 kicks off in Dubai.

Mohieldin stated that according to some international reports, the average funding for climate action globally reached about $1.27 trillion in 2021/2022, but it remains largely directed to mitigation activities by 91%, while adaptation projects benefited from only 5% of the entire climate finance, and projects with dual benefits got 4%. "Reports also showed that 61% of climate finance for the said year was through debt, which represents a serious threat of complicating economic situation in light of the economic pressures to which the world as a whole and developing countries in particular are exposed," he noted.

In this context, Mohieldin noted that developing countries and emerging markets need about $5.3 trillion annually to finance SDGs, of which about $2.4 trillion is to finance only climate action.

In light of finding solutions to bridge the climate finance gap, Mohieldin underlined the importance of strengthening the regional and local dimensions as a way to facilitate increasing funds for climate projects, referring in this regard to the Regional Platforms for Climate Projects (RPCP) launched by the Egyptian Presidency of COP27 in cooperation with the United Nations regional commissions and the HLCs, in which the UAE Presidency of COP28 participated in its second edition, which aimed to find investable, bankable and implementable climate projects. He also noted the National Initiative for Smart Green Projects (NISGP) launched by the Egyptian government as a model for localizing development and climate action.

The climate champion confirmed the importance of activating innovative finance instruments, debt swaps for investment in nature and climate, and launching carbon markets, especially in developing countries, as effective mechanisms to finance climate and development action.

Mohieldin said that reforming climate finance is one of the main objectives of COP28 in Dubai, where the conference will emphasize the need for all countries to abide by their commitments to finance climate action, foremost of which is the $100 billion that developed countries have pledged to provide annually to finance climate action in developing countries, and currently represents a very small fraction of the required finance. The conference will also emphasize the need to restructure the global financial system to serve development and climate purposes in parallel.