Statement delivered on behalf of H.E. Gonzalo Hernández, Vice-minister of Finance and Public Credit, Colombia
V20 MINISTERIAL DIALOGUE X
16 April 2023
Hon. Gonzalo Hernández, Vice-minister of Finance and Public Credit, Colombia
Unfortunately, Vice-Minister Gonzalo Hernández had a flight to catch but we really want to share our view from Colombia as a middle-income country here in this very important group. So, as many of you know, Colombia is the second most biodiverse country in the world, but we are also a tropical country highly affected by climate-related hazards. This hazard risk is Colombia’s largest contingent liability representing 4% of our GDP.
Almost 90% of Colombians are exposed to two or more natural hazards. Consequently, Colombia, as many other middle-income countries, faces a two-fold challenge: 1) to create adaptation measures to protect our people and their livelihood; and 2) to drive economic growth while mitigating its impact on climate change. In this regard, Colombia has taken important steps.
We have developed a local green bond market and a green taxonomy, as well as strengthening resilience with instruments such as the CAT DDO. However, facing climate change is an enormous global challenge no single country can face alone. Therefore, we call for an active role of the international financial institutions. The global financial architecture should be transformed to internalize the externalities associated with the social cost of climate change. For that, we need a coordinated global answer, where the World Bank and the IMF should be leading the pack.
New financial instruments should be created and mainstreamed. Unfortunately, no matter how creative we become in terms of developing these new financial instruments, there are not enough resources available on the table. Additional resources from new additional sources are urgently needed to support developing countries. In this process, the World Bank Group and the IMF have a catalytic role in the provision of adequate finance, technology transfer, and capacity building for our countries.
Thank you, Chair.