There is less than two weeks to go until a record number of countries sign the landmark Climate Change Agreement at an event hosted by United Nations Secretary General Ban Ki-moon. This agreement was negotiated at the United Nations Climate Change Conference in Paris last year, with the World Bank Group offering to assist countries to meet their commitments.
The ‘World Bank Group Climate Change Action Plan’ (CCAP) published by the Bank aims to assist countries in managing climate change impacts. The CCAP reaffirms the World Bank Group’s commitment to increase the climate related share of its investment portfolio to 28% (from 21% currently) within 5 years. Such an increase could realise $29 billion in funding per year.
In a candid assessment, the CCAP points out that by 2050, 9 billion people will need to be fed and will require access to affordable energy. Housing and services including sanitation will need to be provided for an additional 2 billion urban dwellers. This need will have to be balanced with the necessity to minimise greenhouse gas (GHG) emissions and increase global resilience to climate change.
The World Bank Group (WBG) acknowledges that countries have different starting points and different levels of emissions, and therefore require different levels of support. In order to achieve results at a sufficient scale, the CCAP focuses on helping countries to appropriately shape their investment plans and policies, and to leverage private sector investment.
According to the WBG, five key shifts in its climate work are critical. These shifts encompass implementation, convergence, maximising impact, resilience and transformation. In terms of implementation, the WBG will accelerate support for countries and companies to implement the climate change plans they have developed. To address convergence, the WBG climate and development agendas will be integrated into strategies and operations and global and country level action will be aligned. To maximise impact, the WBG will increase its focus on shaping national investment policies and programs as well as mobilising private sector finance. With respect to the WBG’s climate investment portfolio, a greater focus will be placed on adaptation and resilience. Lastly, in terms of transformation, the WBG acknowledges that achieving the Paris commitments requires a shift away from the ‘business as usual’ approach. Therefore, facilitating transformational impacts is an important component of the WBG’s work.
The WBG will collaborate with countries to translate their Paris commitments into climate policies and their climate change related investment plans into actions
The WBG will collaborate with countries to translate their Paris commitments into climate policies and their climate change related investment plans into actions. The WBG’s objective is to assist countries to strengthen their resilience and adaptive capacity as well as to deliver affordable services (e.g. low carbon energy) that are consistent with their Paris commitments. The WBG will ensure that the poor and vulnerable people in each country (who are often most at risk of climate change impacts) will be protected.
In addition to collaborating with countries, the WBG will work with regulators, create green banking champions, provide climate credit lines and promote the continued growth and development of the green bond market. Since 2008 the WBG has issued more than $8 billion in green bonds. It will also scale up financial leverage for resilience and mitigation through improving the preparation, structuring and aggregation of projects and de-risking private investments. Specialised WBG teams will focus on delivering bankable/investable projects through the use of blended concessional finance for what it calls high impact sectors-energy infrastructure, rooftop solar, distributed energy service companies-and delivering resilient urban infrastructure.
By 2020 the WBG will significantly scale up its activities in six areas through direct investments, advisory services and through shaping new and innovative solutions. The six areas are as follows:
- Renewable energy and energy efficiency – the WBG will de-risk renewable energy investments using multiple instruments. Their target is an additional 20 GW of renewable energy generation. They aim to invest $1 billion to promote energy efficiency and resilient buildings in urban areas and to mobilise $25 billion in private funding for clean energy
- Sustainable transport alternatives – the WBG will help countries to develop sustainable transport alternatives and implement transport adaptation options. It will pursue low carbon multimodal transport operations and aim to lend $2 billion for adaptation
- Sustainable and resilient cities – the WBG will further integrate climate into urban planning by developing tools and knowledge through the Global Platform for Sustainable Cities. These will be rolled out in at least 30 cities
- Climate Smart Land Use, Water and Food Security – climate smart agriculture programs and investment plans will be developed for at least 40 countries. Climate smart programs will focus on hybrid seeds and carbon capture practices, high efficiency/low energy use irrigation programs, livestock productivity and energy solutions for agribusiness
- Green competitiveness – the WGB aims to assist 20 countries to enhance their capacity to innovate in climate sectors and increase industrial competitiveness in response to climate change through greening global value chains and trade practices, developing eco-industrial zones and introducing best practice labelling and product standards
- Leaving no one behind – the WBG aims to provide access to hydrological and meteorological data and early disaster warning systems to an additional 100 million people in 15 developing countries and bring adaptive social protection to an additional 50 million people. The Small Island States Resilience Initiative (SISRI) will build capacity, better use existing funds and mobilise increased financing for small island states.
The WBG should be commended on its Action Plan underlining their commitment to providing assistance to countries to meet their Paris commitments. I believe the value of the Action Plan lies beyond providing a roadmap for countries to meet their climate change commitments – whether countries are developed or developing, the CCAP’s value is in signalling the types of initiatives it will support. Governments around the world should take heed of these initiatives and assess those that are most relevant for their economy and extent of development.