COP26 hangs in the balance if G20 fails to show solidarity with climate-vulnerable countries by delivering action
This week, G20 ministers come together for two major meetings. Following commitments they made to climate-vulnerable countries at the Climate and Development Ministerial in March, Alex Scott and Ebony Holland reflect on progress to date and how critical it will be for the G20 to maintain momentum and fill the gaps left by the G7.
In March, the UK brought together more than 45 ministers and heads of multilateral institutions at its virtual Climate and Development Ministerial event. It aimed to unlock political and policy progress on the critical challenges faced by climate-vulnerable countries and communities in delivering on the Paris Agreement and the Sustainable Development Goals.
It was an opportunity for wealthy countries and climate finance institutions to re-establish solidarity with climate-vulnerable countries that has eroded over recent years due to inaction on their priorities.
Rebuilding this trust is crucial ahead of this year's UN climate negotiations (COP26) where an ambitious climate deal will depend on joint political leadership between all climate progressive countries. And this solidarity is front of mind as finance ministers from the Vulnerable Twenty Group (V20), a collaboration of economies most at risk from climate change, also meet this week.
At the ministerial, climate-vulnerable countries stood out for proposing practical solutions. The chair’s summary produced by the UK government captures many of the proposed solutions across four parts to the climate and development nexus:
- Quantity and quality of finance
- Accessibility of climate finance
- Wider fiscal space and debt sustainability, and
- Strengthening finance and support for responding to climate impacts.
Three months on, with the G7 Leaders’ Summit, the US Leaders’ Summit on Climate and the Petersberg Climate Dialogue behind us, what progress has been made towards achieving these solutions? Is the promised solidarity being backed up by action?
We explored these questions with civil society partners during London Climate Action Week to inform an upcoming stocktake report on progress since the ministerial.
Progress – the good, the bad and the promising
While major adjustments to the climate and development system will take years to resolve, key steps proposed by climate vulnerable countries are needed this year to build solidarity:
1. Make good on the US$100bn climate finance commitment - progress has stalled
Wealthy countries have not jointly mobilised the pledged $100bn per year for climate finance, and this is a big deal. While some G7 countries have made promising announcements, there is still a major gap of up to $20bn.
This week’s G20 finance and climate meetings provide a perfect stage for G20 countries to help close the gap, particularly Italy as G20 host but the only G7 country not to make new or increased commitments.
Closing the gap well ahead of COP26 will be key to unlocking this trust (a phrase used by the UK’s COP26 president designate Alok Sharma), yet the UK’s cuts to aid continues to seriously undermine their diplomatic efforts to encourage other countries to increase climate finance ahead of COP26.
As well as the G20 meetings, the UN General Assembly in October is another milestone moment for new commitments, and pressure is on wealthy countries to step up.
2. Tackle climate finance barriers to improve access – more progress needed
Climate-vulnerable countries have been clear – they are struggling to access what climate finance is available. The ministerial meeting did trigger some welcome progress, including the announcement of the new Taskforce on Access to Climate Finance, but more is needed.
The taskforce itself needs to be expanded to tackle the systemic issues highlighted by climate-vulnerable countries at the Climate and Development Ministerial, and summarised by officials from Belize and Bhutan in a recent blog. Priorities include landing a functional climate finance definition, agreeing a single accreditation pathway across climate funds and shifting to longer-term and more transparent climate finance.
Even if the $100bn per year goal is reached, climate-vulnerable countries will not be able to effectively access the money unless these barriers are addressed.
The G20 can stimulate progress by throwing its support behind the taskforce and working with boards of multilateral funds to improve access to climate finance for vulnerable countries.
3. Scale-up debt relief – some progress but more needed
Progress has been made, with expectations of $650bn issuance of special drawing rights (SDR) from the IMF by end of August; together with the possibility of a platform on debt, climate and nature by the Work Bank, International Monetary Fund (IMF), UN and OECD, and signals from the G7 to optimise the balance sheets of multilateral development banks to increase their funding capacity.
However, the approach to reallocate SDRs to low-income countries is yet to be agreed and the demand for debt relief pressure remains pressing and growing. Crucially, the G20 could provide certainty that SDRs and debt relief will be forthcoming and linked to a green inclusive agenda post-COVID-19 with a focus on climate and nature action.
4. Prioritise adaptation and loss and damage – some progress but more needed
Underpinning all the solutions is the need to strengthen finance and support for adaptation and loss and damage. Progress since the ministerial meeting, including announcements at the G7 by the UK and Germany to deliver disaster risk finance for vulnerable communities and to contribute towards the Risk-informed Early Action partnership (REAP) and the InsuResilience Global Partnership targets (PDF), is welcome.
But more is needed. For example, G20 countries could commit to ensuring larger proportions of climate finance is ringfenced for adaptation (for example the Netherlands, Denmark, Sweden and Norway announcing 50% commitments). G20 countries could go further than the G7 and endorse the principles for locally-led adaptation to enable stronger ownership and implementation of adaptation at the local level.
Loss and damage is of increasing importance to many climate vulnerable countries. While there are hints of promising progress, including through the Santiago Network, there are frustrations that efforts appear stalled.
All eyes are on the G20 to accelerate action
As the G20 Summit in October fast approaches, climate-vulnerable countries will be watching preparatory meetings closely to see how ministers from wealthy countries demonstrate solidarity.
Landing strong G20 outcomes on this agenda will be essential for building trust ahead of COP26, and will be a strong indicator of whether the UK’s Climate and Development Ministerial in March really was a defining moment in building this solidarity, or just more hot air.