V20 Finance Ministers welcome Germany’s 120 million euro contribution to the G20+ and V20 InsuResilience Global Partnership
Dhaka – 2 February 2021: Lead representatives of the Vulnerable Group of Twenty (V20) Ministers of Finance today welcomed Germany’s new EUR 120 million commitment to international support announced at the Climate Adaptation Summit on 25-26 January in support of the G20+ and V20 InsuResilience Vision 2025 goal of protecting 500 million poor and vulnerable people.
Ms. Fatima Yasmin, Secretary of the Economic Relations Division, Ministry of Finance, of Bangladesh, which holds the V20 presidency, and member of the InsuResilience High Level Consultative Group said:
“Financial protection against climate and disaster risks is almost non-existent among the most vulnerable communities. Development Partners need to come forward to enhance their engagement through effective development cooperation. In this regard we appreciate the leadership of Germany to prioritize this critical support domain.”
H.E. Alfred Alfred Jr., Minister of Finance of the Marshall Islands and Co-Chair of InsuResilience High Level Consultative Group said:
“We need to look into the kinds of solutions that allow us to build progress fast. To achieve our target of 500 million people protected, we need to develop insurance solutions through aggregators such as cooperatives and actors along the value chain, which is the strategy of the V20-led Sustainable Insurance Facility.”
H.E. Aiyaz Sayed-Khaiyum, Attorney-General and Minister for Economy of Fiji added the importance of resilience investing:
“We echo the call of our V20 counterparts for an Accelerated Finance Mechanism to enable off-balance sheet de-risking tools to reduce the cost of capital of adaptation and renewable energy solutions. The response to this pandemic can mark a turning point to the vulnerable world with real change that delivers real resilience, gains in well-being and sustainable development.”
To close the climate protection gap of over 90% in vulnerable developing countries and to improve access to liquidity through improved affordability of climate and disaster risk protection tools, the V20 has identified a number of key priorities, including:
- The need to develop domestic financial insurance markets through investment in capacity, South-South learning and exchanges in product development. For example, the development financial protection to reach sufficient market scale for the Sustainable Insurance Facility including associated funding vehicles that aim to make available climate-risk insurance micro, small and medium enterprises and the poor and vulnerable that depend on them.
- Time-bound subsidization strategies for climate and disaster risk financing products to gain sufficient market scale to generate sustainable internal momentum.
- Creation of special financial assistance and crisis support needed as a result of systematic and universal consideration of climate risk in IMF Article IV.
- Rebuilding V20 economies must include resilience, productive and sustained employment and cost-effective outcomes. Access to lower cost of capital can improve debt sustainability and allow expanded access to capital. Support to initiatives such as the V20-led Accelerated Financing Mechanism can provide off-balance sheet de-risking tools to be deployed to reduce cost of capital to build climate resilience.
The V20 looks forward to deepened dialogue with the InsuResilience Global Partnership to deliver financial protection to vulnerable developing economies through V20 key priorities.
Notes to Editors
Formed in 2015, the V20 Group of Ministers of Finance is a dedicated cooperation initiative of economies systematically vulnerable to climate change. It is currently chaired by the People’s Republic of Bangladesh. The V20 membership stands at 48 economies including Afghanistan, Bangladesh, Barbados, Bhutan, Burkina Faso, Cambodia, Colombia, Comoros, Costa Rica, Democratic Republic of the Congo, Dominican Republic, Ethiopia, Fiji, The Gambia, Ghana, Grenada, Guatemala, Haiti, Honduras, Kenya, Kiribati, Lebanon, Madagascar, Malawi, Maldives, Marshall Islands, Mongolia, Morocco, Nepal, Niger, Palau, Palestine, Papua New Guinea, Philippines, Rwanda, Saint Lucia, Samoa, Senegal, South Sudan, Sri Lanka, Sudan, Tanzania, Timor-Leste, Tunisia, Tuvalu, Vanuatu, Viet Nam and Yemen.
Nabiha Shahab, firstname.lastname@example.org