The latest report from the Intergovernmental Panel on Climate Change (IPCC) warned that the planet would likely reach the 1.5⁰C limit in early 2030, making climate change a real threat to the survival of many. And while the 2021 United Nations Climate Change Conference (COP26) meeting in Glasgow seemed to acknowledge that, the actual implementation of net-zero emissions remains a conflicted and complicated process.
Multilateral development banks are increasingly reluctant to finance coal projects, yet the energy demand – currently predominantly dependent on fossil fuels – from emerging nations is growing. Such restrictive measures could hamper their ability to achieve the economic growth required to lift their people out of poverty. Industrial economies are pressuring financial institutions – primarily the International Monetary Fund (IMF) – to insist on strict “green” conditions on debt relief to the emerging nations. The Carbon Border Adjustment Mechanism proposed by the European Union aims to force exporters to adopt green production methods, which could severely hurt those in Africa.
And this is the second important thing about COP26: Increasing finance for emerging nations to help them fight climate change. While the delegates agreed to achieve net-zero by mid-century, they also decided that the developed countries must cough up the $100 billion in climate finance per year promised at COP in 2009.
This promise is debatable, it would seem. Oxfam reckoned public climate financing for 2017-18 was a mere $19 billion. In comparison, the Organisation for Economic Co-operation and Development (OECD) claims $78 billion was contributed and, in 2019, $80 billion. At COP26, it was agreed that international financial institutions must play a part in utilising the trillions in private and public sector finance that would help secure global net zero.
The third important point is that France, Germany, the United Kingdom and the United States pledged R130 billion to South Africa to speed up the country’s decarbonisation efforts. Public Enterprises Minister Pravin Gordhan said that the R130 billion was linked to three government projects: Eskom’s just energy transition, green hydrogen and locally produced electric vehicles.
We need to utilise these funds – and others – properly to ensure that we do not continue to contribute to our burning planet.