V20 Calls for Clear Finance Roadmap to Excel in Climate Fight
The Vulnerable 20 (V20) Group of Finance Ministers of the Climate Vulnerable Forum (CVF) meet at the World Bank and IMF Fall meetings
Philippines hands over presidency as Ethiopia becomes V20 Chair
WASHINGTON D.C., 06 October 2016 – On the day after the Paris Agreement on climate change became law, finance ministers representing more than 40 emerging economies that form the Vulnerable Twenty (V20) Group met in Washington, DC to discuss how finance is key to driving the urgent action required at home. At the event, on the sideline of the Annual Meetings of the International Monetary Fund and World Bank Group, Ethiopia assumed the Chair of the V20 Group which was founded in 2015.
Carlos Dominguez, the Secretary of Finance of the Philippines called for a clear roadmap towards the mobilization of $100 billion in additional financing flows to help the most vulnerable countries deal protect themselves. He said V20 international cooperation would “provide our domestic economies with vital support and confidence we need to excel in fighting climate change”.
Abdulaziz Mohammed, the Minsiter of Finance and Economic Cooperation of Ethiopia, highlighted devastating effects and “lethal excesses caused by the world’s most gigantic externality”, adding that “we would like to express Ethiopia’s commitment for its candid leadership for the achievement of the V20 vision, and to work towards the fulfilment of the Paris climate agreement at large”.
Speaking at the V20 Ministerial, Helen Clark, UNDP Administrator, recognized the role of the vulnerable countries in the Paris Agreement through convincing the international community that a world where warming does not exceed 1.5 degrees was worth fighting for. She said “UNDP, and the entire UN development system, will work to support you in accomplishing your mission.”
Photo Caption: Philippines handover the V20 Presidency to Ethiopia; Source: The V20 Group of Finance Ministers; License: CC BY-NC 2.0
Philippines Energy Policy Review Sets Green Economy Shift: Purisima: Climate finance integral to a successful transformation
Manila, Philippines – Friday, 3 June, 2016 – Finance Secretary Cesar V. Purisima welcomed President Benigno S. Aquino III’s call for a sweeping review of Philippine energy policy, setting the path for a whole-of-nation approach away from carbon and towards green energy development.
As chair of the V20 Group, now expanded to 43 countries most systemically vulnerable to the consequences of climate change, Purisima has called for a rethinking of the global economy through V20 initiatives like climate accounting and carbon pricing.
“Apart from its human costs—which ought to be a convincing enough reason for decisive global action in and of itself—climate change is a dead weight to the global economy. Business as usual no longer presents a strong business case for anyone. Shifting to clean, renewable energy is the best investment we can make for our future.
To this end, the V20 Group is developing concrete ways to reorder incentive structures governing human behavior in the global economy. Changing how we value and price the costs of human (in)action to climate change ought to make a green energy shift the only sensible choice to make for everyone,” Purisima said.
Climate change-related disasters have claimed over 1.35 million lives in total and affected an average of 218 million annually over the past 2 decades. Developing countries bear more than half the economic impact of climate change over 80% of its health impact, with annual climate change-related economic costs of $44.9 billion projected to increase ten-fold by 2030.
According to the Global Partnership for Preparedness, a group recently launched by V20 and several UN agencies, the global economic impact of climate change since 2005 has breached $1.3 trillion.
Purisima earlier emphasized this in his keynote address at the Future of Asia Conference in Tokyo, where he cited studies showing how climate change has already held back global development by close to 1% of the world GDP. Purisima also referred to a paper published in the scientific journal Nature estimating that overall economic production would fall by about 23 percent by 2100 if the climate keeps changing under the current models. The study also projected that climate change would reduce average incomes in the poorest 40 percent of countries by 75 percent in 2100, while making 43% of the global population poorer in 2100 than today.
“While we in the V20 Group work with experts and multilaterals on risk pooling mechanisms as well as other mitigation and adaptation measures, it is important for developing economies to get efficient access to financial resources to adapt and shift towards a green economy.” Purisima has been vocal in leading the V20 in advocating for swifter progress towards the achievement of the joint $100 billion developed country commitment for support to developing countries via the Green Climate Fund.
“Transitioning towards a green economy requires a lot of money, we must admit. It costs even more for developing countries. But the cost of saving our planet can never be more than the cost of losing it. This is why we need global collaboration on climate finance to fund a more sustainable future,” Purisima added.
High-Level Leaders’ Roundtable: Natural Disasters & Climate Change: Managing Risks and Crises Differently
24 May 2016 (9:00 am to 11:00 am) Beyazit Hall, B-2 Floor, ICC, Istanbul, Turkey
Hon. Roberto B. Tan, Treasurer of the Philippines, Department of Finance, Republic of the Philippines
Part 1: Country Statement
Mr. President, Excellencies, Honourable Colleagues and Partners, Ladies and Gentlemen, good morning!
This year, the rise in the global temperature marks the hottest ever recorded, prompting scientists to declare a climate emergency.
This climate phenomenon exposes humanity, particularly the most vulnerable, to increasing risks caused by weather-related extreme events and sea level rise.
To face the new normal, we acknowledge the need to further act to protect our people and our future.
Under Core Commitment 2, the Philippines is keen on working towards enhancing financial and social protection and further implementing our disaster risk financing and insurance strategy at various levels.
Using our budget, we will further prioritize investments on resiliency and adaptation, including building more resilient structures and using our natural systems. We will also improve the strategic use of our national and local funds on preparedness and prevention.
In sync with our public finance reforms, we will develop or strengthen policies to achieve better planning, including on procurement, and update our DRRM law.
We will continue to improve efforts in DRR such as the Pre-Disaster Risk Assessment (PDRA).
We will build on our experience in tracking our expenditures on climate action. Upholding good governance, the Philippines will continue to improve the accounting of disaster aid and enhance our coordination mechanisms to request and accept international assistance [through the guidelines for the Philippine International Humanitarian Assistance Center (PIHAC)].
Under Core Commitment 5, the Philippines will continue to participate in global platforms to develop common humanitarian civil-military coordination standards by taking a lead role in the UN Civil Military Cooperation.
The Philippines will uphold its commitment as a signatory to the ASEAN Agreement on Disaster Management and Emergency Response (AADMER) in coordinating humanitarian assistance in the region.
We will remain committed to support and actively engage in the Global Platform for Disaster Risk Reduction.
Part 2: Joint V20–CVF Statement at the World Humanitarian Summit
Mr. President, the Philippines chairs the Vulnerable Twenty Group of Finance Ministers (the V20) and its associated initiative, the Climate Vulnerable Forum, representing 1 billion people highly vulnerable to the effects of climate change.
We are highlighting at this Summit that dealing with climate change is now indispensable to dealing with humanitarian crises.
The landmark Paris Agreement and its goal of pursuing efforts to limit warming to 1.5 degrees Celsius must be fully implemented if we are to have hope of containing such escalating risks and their humanitarian repercussions.
Even limiting warming to 1.5 degrees, however, would still lead to approximately a doubling of effects. This is why climate finance flows to help communities adapt is as critical as funds for emission controls.
Achieving this balance by 2020 is not only a major humanitarian priority that will save lives. It also makes financial sense.
Consider that 56 billion dollars have been spent on humanitarian response by international donors in the 43 V20 countries between 1991 and 2010. This equates to 31.7% of total international humanitarian financing, which was $176.8 billion. However, in this same period only $13.5 billion was spent by the international community worldwide on Disaster Risk Reduction and preparedness. Where is the logic?
We are convinced that investing in preparedness is a no regret, cost effective investment for everyone. That is why the V20 is spearheading the launch of a major new initiative: the Global Preparedness Partnership. With the support of the international community, we can put a different, anticipatory and more cost-efficient formula into action.
We urge you to join forces in the Global Preparedness Partnership so that the most at-risk countries can achieve a minimum level of readiness to future shocks.
Part 3: Closing
Mr. President, we have put forward today what the Philippines is willing to invest in for the future of humanity. Our group of 43 countries resonates the call to action and will count on partners to work with us on tangible investments such as on preparedness.
Thank you, Mr. President.
New Global Partnership for Preparedness Launched: V20, UN and World Bank Collaboration to help countries get ready for future disasters
Istanbul, Turkey – Tuesday, May 24, 2016 – A major new partnership to better prepare countries and communities for disasters is being launched today at the World Humanitarian Summit as a united response to a continuing rise in humanitarian emergencies.
The new global partnership for preparedness (GPP) is led by the Vulnerable Twenty (V20) Group of Ministers of Finance of the Climate Vulnerable Forum which represents 43 high risk developing nations in collaboration with UN agencies, including the Food and Agriculture Organization (FAO), the Office for the Coordination of Humanitarian Affairs (UNOCHA), United Nations Development Programme (UNDP) and the World Food Programme (WFP), as well as the World Bank’s Global Facility for Disaster Reduction and Recovery (GFDRR). The partnership will strengthen preparedness capacities initially in 20 countries, so they attain a minimum level of readiness by 2020 for future disaster risks mainly caused by climate change.
Roberto B. Tan, Treasurer of the Philippines, representing the chair of the V20, says that the goal of the partnership with the international community is to make sure that when disasters strike, the mechanisms and support are in place so people can get back on their feet as soon as possible, therefore minimizing the impact on development gains and preventing uncontrolled humanitarian crises. “We know investment in preparedness saves lives and dollars and thus makes financial and economic sense. If we plan ahead, we will create a situation where instead of wave after wave of climate-driven natural disasters destroying what gains communities have made, they can pick up their lives again as soon as possible. Crises such as those from natural disasters and effects of climate change should no longer spin out of control,” Treasurer Tan says.
United Nations Development Program Administrator Helen Clark says: “This partnership will help countries to reach an adequate level of preparedness for disasters and other shocks. The aim is to save lives, safeguard development gains, and reduce the economic impacts of crises. Importantly, this also safeguards development gains, which can otherwise be lost with each disaster, she said. “This new partnership puts at-risk countries in the driver’s seat and brings together the work of development and humanitarian actors in a coherent way.”
Stephen O’Brien, United Nations Under-Secretary-General for Humanitarian Affairs and Emergency Relief Coordinator states: “Extreme weather and other shocks shouldn’t become major humanitarian disasters if we better anticipate and plan for them ahead, and reinforce local response capacity. The global preparedness partnership led by countries most at risk of climate change through the V20 provides a key opportunity to make this happen”.
Laura Tuck, Vice President for Sustainable Development at the World Bank adds: “At the initiative of the Vulnerable Twenty Group of countries, we are joining UN agencies to support a global preparedness partnership to help build strong national and local institutions and ensure that planning and financing for preparedness are integral parts of countries’ disaster management frameworks.”
“The world’s population that depends on farming, livestock, fishing and forests for their food and livelihoods, are highly vulnerable to natural disasters, whether provoked by extreme events such as storms, droughts, floods or earthquakes. Farming remains a key economic activity for millions of people across the developing world and the bedrock of food security,” said FAO Director-General José Graziano da Silva. “This new effort will help build up the resilience of rural communities and boost national capacities to prepare for problems and respond effectively to disasters when they occur,” he added.
“As climate change increases the frequency and intensity of natural disasters, there is a need to shift from a focus on crisis response to taking anticipatory actions to manage risks. The global preparedness partnership recognizes that predictable finance and strengthened government capacity are essential for saving lives and reducing the cost of responding to disasters”, concludes Ertharin Cousin, Executive Director of the UN World Food Programme.
The partnership will become operational later this year and seeks to provide the initial 20 countries with support to achieve:
better access to risk analysis and early warning;
contingency plans with clear lines of responsibility, triggers for action, and pre-committed finance;
developing social protection, basic services and delivery systems capable of responding to shocks.
Photo Caption: The V20 Chair (Philippines) and Nepal standing together with UNDP and the World Bank for global preparedness
Global Preparedness Partnership to be Launched at the World Humanitarian Summit
24 May 2016, Istanbul
A groundbreaking new partnership to better prepare countries and communities for disasters will be launched today at the World Humanitarian Summit in Istanbul.
The new global partnership for preparedness will be led by the Vulnerable Twenty (V20) Group of Ministers of Finance of the Climate Vulnerable Forum which represents 43 high risk developing nations in collaboration with key UN agencies including the United Nations Development Program (UNDP), the Food and Agriculture Organization (FAO), the World Food Programme (WFP), the Office for the Coordination of Humanitarian Affairs (UNOCHA) and the World Bank.
The partnership, which will focus on strengthening preparedness capacities, will be launched at the Natural Disasters and Climate Change – Managing Risks and Crises Differently High Level Roundtable on Tuesday at 9am EEST. The Climate Vulnerable Forum @TheCVF will be live tweeting throughout the Roundtable. You can also watch a webcast here.
2nd Ministerial Communique: Vulnerable Twenty Group of Ministers of Finance
14 April 2016 | Washington DC
2nd Ministerial Dialogue of the Vulnerable Twenty (V20) Group
We met in Washington, DC on this 14th day of April for our second gathering as Finance Ministers of developing economies systemically vulnerable to climate change chaired by Hon. Cesar Purisima, Secretary of Finance of the Philippines with Bangladesh and Costa Rica as Troika Co-Chairs. We reviewed progress in responding to this defining challenge in our time for survival and for the economy, and we advanced our collective work.
We recognized 23 new V20 members considerably strengthening our dedicated cooperation for enhanced economic and financial actions to address climate change while remaining true to the core needs of members most threatened by global warming. Our economies are home to one billion people whose fate hinges on an effective response.
We called for bolder action by the world’s major economies, strengthened international partnership and reaffirmed our intentions to lead, despite our marginal contribution to global emissions, through actions at home to the limits of our capabilities. We take pride in our successful efforts advocating for the landmark new 1.5 degrees Celsius warming target agreed at Paris in December 2015. We now devote our energies to ensuring a financial system consistent with 1.5 degrees and the reinforcing of the resilience of vulnerable groups around the world.
We expressed alarm at the shattering in 2015 of all temperature records and for surpassing a 1 degree Celsius rise in heat above the pre-industrial era norm. Vulnerable countries continue to suffer disproportionately from the fast accelerating rates of the planet’s warming. In past months we have struggled with widespread heavy rainfall, severe drought in Southern Africa, Latin America and the Caribbean, unprecedented cyclones and kingtides in the Pacific and heatwaves in Asia and Latin America. We face coastal flooding and erosion in our low elevation zones, increasingly adverse thermal conditions for much of our workforce, the compounding of regional security challenges and infringements to fundamental human rights. Even at 1.5 degrees, we will experience a considerable progression of impacts and dangers, underscoring the criticality and urgency of investing in increased resilience and adaptation. The impact of climate change, however, affects us all and carries macro-economic repercussions for growth already embedded as a negative weight on the global recovery.
Determined to overcome these challenges, we fight on with renewed hope. Carbon emissions growth stalled for the second year in a row in tandem with global economic expansion. In addition, the past year saw around 90% of new energy production provided by renewables, according to the International Energy Agency, pointing to the clear compatibility of economic and climate change policies and the potential for further change. Strengthening responses to climate change will reinforce global economic recovery and help restore robust, sustained and balanced growth by containing explosive and costly climate change risks that worsen inequalities and harm people, communities and the world economy. Such actions are a humanitarian priority for protecting fundamental human rights.
We presented our Intended Nationally Determined Contributions (INDCs) to reduce emissions under the new Paris Agreement as a first step to action. These INDCs are also the foundations of investment platforms for transformational economic action. Their realization calls for the delivery of additional and concessional international financing that safeguards debt sustainability, as we strive at ambition in communicated national adaptation and mitigation objectives that our Group aims to see realized, if not surpassed.
We are advancing in parallel with the realization of our 2020 Action Plan to foster a significant increase in the level of resources from all sources to support ambition in our national climate actions. In the context of our Work Plan for implementing V20 priorities, we agreed on the commencement of the first phase of our Action Plan with an initial series of National-Regional Consultations to be hosted by Bangladesh and Philippines. We also established Focus Groups of our members to advance our work in the areas of Advocacy and Partnerships, Climate Accounting, and Risk Pooling. We welcomed the support of a wide range of partners and multilateral institutions behind our activities and look forward to building further on our collaborations moving forward with urgency in our response to climate change in the areas of disaster preparedness, financial protection, financial flow analysis, carbon pricing, public-private partnerships and risk pooling.
In the context of our Action Plan, we agreed to enhance financial protection by addressing financial resilience against climate and disaster risks at national and regional levels. This includes a focus on strategies to improve the financial management of climate and disaster risks, and strengthen each country’s ability to recover from climate-related disaster shocks building from core principles of country ownership; sustainability; contingency planning; accountability; and private sector involvement.
We recognize the vital role of the private sector in generating transformation change to the world economy and in our domestic markets. In doing so, we moved to create a platform for collaboration with the private sector focused on investment opportunities associated with responding to the challenges of climate change through innovations in the sectors of energy, transportation, infrastructure, buildings, agriculture, water supplies, well-planned migration, and other areas. The platform will also focus on publics-private partnership best practice, and on policies and initiatives to mobilize investment and other forms of private sector collaboration.
We reiterate our strong support for innovative revenue generating fiscal and financial measures to raise finance, stimulate technological innovation and redirect investment toward climate resilient and low-emissions development. In this respect and with consideration to each country’s respective capabilities, we commit to support carbon pricing by working to establish pricing regimes within the next decade. As a first step towards the realization of that vision, we will begin work with international partners and platforms–including the Carbon Pricing Leadership Coalition and Market Readiness Partnership–to review options and best practices and engage in advocacy to promote similar steps in other markets towards the goal of a greatly increased share of global emissions subject to pricing. We request the Secretariat to prepare a working paper based on these interactions and agree to revisit collective implementation ideas at the next V20 Ministerial Dialogue. We also reaffirm our support for the urgency of carrying out innovative financial measures, including Financial Transaction Tax, as contributions to closing financial gaps between Paris Agreement objectives and the inadequacies of projected flows.
We will continue our work in the area of improving financial accounting including valuation of the costs of climate change and the co-benefits of climate action in order to inform sound and refined economic policy-making domestically and at international level. In particular, we will promote methods and approaches to internalizing the externalities of climate change into finance since the factoring of these costs is essential to altering business-as-usual courses of action and to driving greater ambition. We appreciate and call for further analytical research into the nature of international climate change finance flows with respect to UNFCCC commitments and the independent commitment of developed countries to provide 0.7% GNI in Official Development Assistance. Our work in this domain will continue under the Focus Group on climate accounting.
Extending insurance coverage, ensuring grass-roots access and expanding risk pooling represent tremendous opportunities for increasing resilience to the wide array of climate-related catastrophes that continue to set back the lives of our people. Having reviewed the V20-mandated study prepared by the Secretariat into options for the creation of a V20 Risk Pooling Mechanism, we note that half the population of V20 countries lack access to external pooling mechanisms of any kind. Recognizing the importance of risk pooling for lowering premiums, extending insurance coverage, increasing pay-out reliability and promoting risk reduction, we agreed to move forward with the initiative. Building on the initial study, the Focus Group for Risk Pooling is tasked with developing a complete proposal for the Mechanism within one year in further consultations with key stakeholders.
We strongly welcome the adoption of the Paris Agreement on Climate Change and its enshrining of our key priority to limit warming to not more than 1.5 degrees Celsius, keeping temperatures well below 2 degrees. We also welcome the new global goal on adaptation for enhancing adaptive capacity, strengthening resilience and reducing vulnerability and the new significance the Agreement accords to climate justice, human rights and loss and damage. Early ratification/accession led by the vulnerable countries–Fiji, Palau and Marshall Islands–is an immediate priority for all nations, and essential to give effect to the framework. Efforts should immediately be undertaken to implement and increase the ambition of national commitments to achieve compliance with a 1.5 degrees goal, recognizing that higher levels of warming threatens the very survival of a number of our low-lying island members. It is therefore equally imperative that all countries’ long-term low greenhouse gas emission development strategies for communication in 2020 demonstrate consistency with actions to achieve the 1.5 degrees limit. The international community should take advantage of the 2018 facilitative dialogue to take stock of collective efforts to inform these actions including on the basis of the forthcoming UN Framework Convention (UNFCCC) -mandated Intergovernmental Panel on Climate Change (IPCC) Special Report on 1.5 degrees that was agreed to this week in Nairobi during the IPCC’s 43rd session.
International public finance commitments including financial support will be vital to enabling an ambitious global response. Capacity constraints facing developing countries are particularly severe for those most vulnerable to climate change. Swifter progress towards the achievement of the joint US$100 billion developed country commitment for support to developing countries, including as a priority via the Green Climate Fund, will build confidence in global efforts and contribute to raising ambition. Global resource mobilization must go far beyond the US$100 billion. We further appreciate the new UNFCCC post-2025 joint finance commitment from a floor of US$100 billion by developed countries in support of meaningful developing country climate action. Important Paris Agreement provisions include the consistency of financial flows with low-emissions and climate-resilient development and the need for grant-based finance for adaptation, which is vital for actions among the world’s poorest groups and informal or non-market sectors. We also strongly welcome UNFCCC decisions on efficient access to financial resources through simplified approval procedures and enhanced readiness support for developing countries which are urgent priorities right now. We appreciate the Capacity-building Initiative for Transparency to support developing countries to meet the enhanced transparency requirements and frameworks including on finance. We welcome UNFCCC decisions encouraging all parties to voluntarily contribute to climate finance and recognize those V20 members that have already funded the Convention’s Financial Mechanism while encouraging all countries to consider similar actions.
We continue our call for the internationally agreed balance of climate change finance to be achieved as an even 50:50 allocation between adaptation and mitigation by 2020 at the latest. Lives, health, fragile ecosystems, and progress towards the 2030 Sustainable Development Goals depend on greater support for adaptation given the socio-economic dimensions of climate change vulnerability with the poorest groups, women and children among the hardest hit. We expect the instruments to the UNFCCC Financial Mechanism to demonstrate progress towards early achievement of the balance and will focus our collective vigilance in that respect. We also call for the integration and continuation of the Adaptation Fund under the Financial Mechanism of the Paris Agreement. We call for additional support for our countries for the reinforcement of critical enabling climate finance mobilization capabilities.
We express alignment with the G7 on the long-term objective of applying effective policies and actions throughout the global economy in the response to climate change, including carbon market-based and regulatory instruments. We extend appreciation to the G7 for its pledge to intensify support for vulnerable countries own efforts to manage climate change related disaster risk and build resilience. We welcomed the Financial Stability Board’s task force on climate-related financial disclosures and the establishment of a new G20 Green Finance Study Group to identify institutional and market barriers to green finance and develop options on how to enhance the ability of the financial system to mobilize private capital for green investment including in collaboration with external initiatives. We look forward to collaborate closely on these initiatives and call on the G7 and G20 to recognize the need for efforts to achieve the new 1.5 degrees limit and global adaptation goal. We urge G7/G20 steps to scale up climate action consistent with these objectives in solidarity with vulnerable groups inclusive of moves to implement and raise the ambition of previously communicated commitments by 2020 at the latest. We also expect the low greenhouse gas emission strategies of the major economies to demonstrate clear contributions to capping warming at 1.5 degrees.
We urge further enhancement of the climate change focus of Multi-Lateral Development Banks and International Financial Institutions (IFIs), in the context of country-led/country-driven development and national partnerships, as aligned with ambitious new Paris Agreement objectives. We call for coordinated actions especially in the areas of infrastructure, energy and forestry, for the integration of climate change considerations in macroeconomic projections and Article IV IMF consultations. We request IFIs for innovative financing structures and solutions that respect our requirements for debt sustainability and for support on project due diligence and pipeline development. Such efforts would help leverage the full extent of investment opportunities embodied by our national commitments under the Paris Agreement and unlock further ambition as contributions towards achieving the 1.5 degrees limit and global adaptation goal. We welcome the World Bank Climate Change Action Plan, which we expect will make a significant contribution in this respect. In highlighting our need for mechanisms to pool risk and recalling our forthcoming work on carbon pricing, we also called for dedicated support to expand risk pooling and for readiness assistance on mechanisms for pricing emissions.
We agreed to reconvene at Washington, DC in October 2016 for the third V20 Ministerial Dialogue and directed the Working Group to continue its activities in advancing the priorities of the Group.
V20: Climate Fight Essential to Global Recovery
Group of more than 40 economies systemically vulnerable to climate change advance efforts to pioneer financial innovation in responding to climate threats
Finance Ministers insist on a financial system compatible with the new 1.5°C Paris Agreement limit, calling for G7 and G20 to align development priorities with the goal
Swifter progress towards the $100 billion international climate finance commitment and increased concessional financing for climate action urged
Long-term vision to establish carbon pricing regimes adopted by expanded V20 Group