After another year of record-breaking temperatures and extreme weather disasters, wealthy countries are under pressure to make good on their commitment to mobilize finance to help poorer countries deal with climate change. The Paris Agreement in 2015 saw developed economies committing to channel $100 billion per year to help poorer countries deal with climate change.

But there is an overwhelming lack of data on “climate finance,” and developing countries are woefully short of the actual need. Documents from the UN suggest that the cost for low-income countries to adapt to climate impacts far exceeds the promised $100 billion a year.

Meanwhile, the International Energy Agency estimated the climate investment needs under different mandated emission scenarios, ranging between $3.4 trillion and $8.1 trillion annually, to achieve carbon neutrality globally by 2050. 

At the G20 summit, UAE Minister of State for Financial Affairs Mohamed bin Hadi Al Hussaini stressed the importance of a multilateral approach to promoting climate financing.

Speaking at the first meeting of the G20 Finance Ministers and Central Bank Governors in Bengaluru, India, Al Hussaini said bolstering coordinated international action to establish objectives and develop plans for decisions regarding investments in climate finance to meet sustainable targets is crucial.

“We have leveraged private sector participation in the development of smart cities through collaborative models that incentivize private sector involvement in areas such as clean energy, green buildings, and ICT infrastructure development, which we believe to be all critical enablers for the future cities of tomorrow,” he said. 

In the address, Al Hussaini also mentioned that despite challenges in the global economy, the UAE’s gross domestic product is predicted to increase by 4.2% in 2023. “The UAE’s economy continues to withstand global effects. On a global scale, there remains an immediate need for policy coordination to minimize vulnerabilities and promote food and energy security,” he added. 

Meanwhile, Kristalina Georgieva, director of International Monetary Fund Managing, stated that the world’s economic growth would decline in 2023 and remain below its historical average since too many nations struggle to make ends meet.

“The international community, therefore, is responsible for coming together to find solutions for the most vulnerable members of our global family. This calls for urgent action to strengthen the international financial architecture, especially in debt resolution and strengthening the global financial safety net,” she said.