In Short : The $100 billion per year that was committed by developed countries under the Paris Agreement’s Green Climate Fund is a significant step towards supporting developing countries in their efforts to address climate change. However, many experts argue that this amount is insufficient to meet the scale of the challenge.
In Detail : Developed countries promised poorer nations $100 billion a year in money to help countries deal with global warming — and get off fossil fuels. But that money isn’t nearly enough.
JUANA SUMMERS, HOST:
Developing countries are already bearing the brunt of climate change, from storms to floods to droughts. At the U.N. climate conference starting this week in Dubai, NPR’s Julia Simon reports a big question is how to get these countries money and how much.
JULIA SIMON, BYLINE: Last year Pakistan experienced record floods, which displaced millions of people.
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SIMON: Scientists found those floods were made more likely because of global warming. Almost a third of the country was underwater.
ZAFAR KHAN: It was more than 1,700 people who died.
SIMON: Zafar Khan is professor of forestry at Karakoram University in Pakistan. The floods caused more than $30 billion in damage by some estimates, and that’s on top of all the other debt Pakistan has. After the floods last year, Moody’s and Fitch downgraded their ratings of Pakistan. That’s made it even harder for the country to get good terms for loans. These financial problems are made worse because the country expects even more climate disasters in the future. And Khan says Pakistan is not largely responsible for climate change.
KHAN: It’s less than 1% if we are talking about the global emissions. But on the other hand, this country is suffering a lot.
SIMON: That’s why Stacy-ann Robinson, professor of environmental studies at Colby College in Maine, says you can’t talk about climate finance without talking about climate justice.
STACY-ANN ROBINSON: Countries in the Global South are saying, listen. Because we did not cause this problem, we should not have to take the lead on climate finance.
SIMON: Fourteen years ago, industrialized nations like the U.S. said they would take the lead. They are, after all, responsible for most emissions that have caused climate change. They pledged to give 100 billion each year to developing countries like Pakistan by 2020. Last year they may have finally reached that goal, according to a new report. Laura Kuhl, public policy professor at Northeastern University, says that money pays for…
LAURA KUHL: Renewable energy, can be investments in helping countries manage the impacts of climate change. It all counts.
SIMON: Some of that money comes from wealthier countries, some from institutions like the World Bank, and a lot comes from the private sector. Jake Levine is chief climate officer of the U.S. International Development Finance Corporation. It’s a federal agency that, among other things, tries to get more private sector money to developing countries.
JAKE LEVINE: Imagine that you are an entrepreneur in Karachi and you decide, I’m going to start a e-motorcycle business.
SIMON: Moving from fossil fuel-powered motorcycles to electric ones is a climate solution. But starting this business can be tricky in a place like Pakistan.
LEVINE: You go to your bank, and the bank is unwilling to finance you because you aren’t able to establish a credit history or track record.
SIMON: That’s why Levine’s agency is finding ways to make it less risky for, say, a big bank to lend to a small Karachi climate business.
LEVINE: Of course, there is a crisis that we’re facing. But this also is a once-in-a-generation opportunity for investment.
SIMON: But experts worry that most of the climate money going into developing countries comes through loans. Those loans often have to be paid back with interest. Kuhl says that can trap countries in more debt.
KUHL: That’s concerning because it’s potentially increasing the financial vulnerability of developing countries.
SIMON: Vulnerable countries have been pushing for years to get debt relief when disaster hits with limited success. Meanwhile, experts say that 100 billion pledged to developing countries isn’t nearly enough. Recent report says it will need to be more like $2 trillion a year by 2026. A big question of climate finance at this year’s U.N. climate talks will be how to move from billions to trillions. Julia Simon, NPR News.