European Union institutions are failing on their climate finance commitments
A new report from ACT Alliance EU* reveals that EU institutions are failing to meet their climate finance commitments. A policy shift is needed to ensure that developing countries receive the appropriate support to address the climate crisis.
The report assesses climate finance channelled from the European Investment Bank, European Development Fund, and the European Commission, to developing countries. It reveals the decline in climate adaptation and grant-based financial support for the most climate-vulnerable countries.
While support to developing countries is part of the Paris Climate Agreement, signed by the EU, its member states and countries around the world, the report concludes that EU institutions have to improve before they adequately meet their commitments to the Paris Agreement.
ACT Alliance EU Representative Floris Faber comments:
“It is important that climate finance and other commitments made in the Paris Agreement are respected and fulfilled. We already know that climate change is a stark reality for poor and climate-vulnerable countries and communities around the world. To overcome the widespread suffering connected to climate impacts, adequate and appropriate financial support for the most vulnerable is essential.”
2020 is a decisive year in the climate debate. It is the year from when developed countries must mobilize 100 bn USD annually for climate activities in developing countries. It is also the year when all countries must increase their greenhouse gas emission reduction targets towards 2030. In light of this, increased climate finance support would allow developing countries to ramp up their climate ambition for the next decade.
Chief Advisor from DanChurchAid, a Danish member of ACT Alliance EU, Mattias Söderberg comments:
“EU leaders have again and again supported scaled-up climate ambition in their speeches. However, when we look at the EU’s climate finance data, it appears that grant-based support is decreasing, support for adaptation and support to the most vulnerable countries are also decreasing.
The EU’s commitments are not in line with what is actually being delivered to developing countries. This needs to improve because real investments are needed for impactful climate action.
The EU has acknowledged the need to scale up support for adaptation initiatives, but the data suggests that this is not happening.
We were surprised and disappointed to note that grant-based support is decreasing, while increasingly, support is being delivered as loans, which has the potential to lead to climate debt. This is a worrying trend, and we strongly urge the EU to reconsider this approach.
Those who are most vulnerable to the effects of climate change are those who have contributed the least. We have a moral obligation to assist, and climate finance is one way in which we can do so.”
Rachel Simon, Climate and Development Policy Coordinator, Climate Action Network Europe, comments:
“This report shows us what lessons the EU institutions can learn from their contributions to the $100 billion climate finance commitment. Not just quantity, but the quality of climate finance is really important to ensure it supports the most vulnerable countries in dealing with climate change. To deliver on the European Green Deal, the Council, Parliament and Commission need to agree that support in the post-2020 EU budget for developing countries should prioritise grant-based finance, have a 50% climate and environment target, and safeguard support for adaptation projects and the most vulnerable communities. “
The European Commission, European Council and Parliament will finalise negotiations on the future Neighbourhood, Development and International Cooperation Instrument in forthcoming inter-institutional or ‘trialogue’ negotiations. This is one of the programmes under the post-2020 EU budget and recovery package.
Mattias Söderberg, Chief Advisor at DanChurchAid and climate finance spokesperson of ACT Alliance EU, email@example.com, 045-29700609
Notes to editors:
The full report can be found here https://bit.ly/2QHY0xd
* In the European Commission’s proposal for the new recovery package https://ec.europa.eu/info/live-work-travel-eu/health/coronavirus-response/recovery-plan-europe_en €10.5 billion from Next Generation EU has been allocated to the future Neighbourhood, Development and International Cooperation Instrument (May 2018 prices). All of this additional funding is proposed for the External Action Guarantee, which backs loans and loan guarantees granted to non-EU countries or to finance projects in non-EU countries, through the European Fund for Sustainable Development Plus.