dealing with climate change
ADB to double funding for Asia-Pacific by 2020
ADB spending will rise to around 30pc of its overall financing by the end of this decade
Asian Development Bank (ADB) president Takehiko Nakao announced on Friday that the multilateral finance institution will double its annual climate financing to USD 6 billion by 2020, up from the current USD 3 billion.
The ADBs spending on dealing with climate change will rise to around 30 per cent of its overall financing by the end of this decade, a statement said. The ADBs announcement comes against the backdrop of a promise by developed countries to mobilise USD 100 billion every year from 2020 to counter climate change in developing countries. Of the amount of USD 6 billion, USD 4 billion will be dedicated to mitigation through scaling up support for renewable energy, energy efficiency, sustainable transport, and building smart cities. An amount of USD 2 billion will be for adaptation through more resilient infrastructure, climate-smart agriculture, and better preparation for climate-related disasters.
The ADBs doubling of climate finance reflects its strategic priorities as well as the increase in ADBs overall financing capacity by up to 50 per cent due to a more efficient use of its balance sheet, by combining the equities of its Ordinary Capital Resources and Asian Development Fund (concessional finance window) in 2017.
World leaders gathering in New York this weekend will commit to achieving 17 historic Sustainable Development Goals (SDGs) by 2030. The ADB stands ready to be an important part of global efforts to finance these goals, Nakao said. Nowhere is tackling climate change more critical than in Asia and the Pacific, where rising sea levels, melting glaciers, and weather extremes, like floods and droughts, are damaging livelihoods and taking far too many lives.
SDG 13 specifically calls for urgent action to combat climate change and its impacts. Also, mitigating and adapting to a changing climate are key to most of the other goals, including ending poverty, achieving food and water security, providing access to energy, and building sustainable cities.
Later this year, at the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP21) in Paris, the international community is expected to finalise a new global climate agreement and the way to finance it.
In addition to scaling up its own climate financing, ADB will continue to explore new and innovative co-financing opportunities with public and private partners. For example, the ADB will seek to mobilise concessional financing from the Green Climate Fund, which is becoming operational, for the ADBs adaptation projects in poorer countries.
The ADB will tap institutional investment through private equity funds, like the ADB-sponsored Asia Climate Partners. The ADB will also issue more green bonds as an important source of funding for its climate operations.
