The world’s six largest multilateral developments banks (MDBs) continued to make a strong contribution to the global climate challenge in 2016, increasing their climate financing in developing countries and emerging economies last year to US $27.4 billion from US $25 billion in 2015.

Of this amount, US $21.2 billion -or 77 per cent – was dedicated to climate mitigation finance, with the remaining 23 per cent devoted to climate adaptation, according to an AfDB release to the Ghana News Agency.

It said combined with additional co-financing from other investors, the total amount of finance mobilized for climate action reached US $65.3 billion last year.

The MDBs have reported jointly supported on climate finance since 2011. Collectively, the banks have committed over US $158 billion in climate finance during the past six years.

The latest MDB climate finance figures are detailed in the 2016 Joint Report on Multilateral Development Banks’ Climate Finance.

The Report combines data from the African Development Bank Group, the Asian Development Bank, the European Bank for Reconstruction and Development, the European Investment Bank, the Inter-American Development Bank Group and the World Bank Group.

Broken down by region, the largest share of last year’s MDB climate finance went to South Asia, with 20 per cent, followed by East Asia and the Pacific and non-EU Europe and Central Asia, with 19 and 18 per cent, respectively.

The Middle East and North Africa at 9 per cent and Sub-Saharan Africa at 7 per cent, receiving the least climate finance, despite being the regions to be most impacted by climate change – according to the Inter-governmental Panel on Climate Change (IPCC).

This state of affairs contradicts the sense of urgency, which underlined the pledge by developed countries to commit US $100 billion per year of new and additional finance to assist developing countries to address adverse effects of climate change (which was further reinforced in the Paris Agreement).

Mr Anthiny Nyong, Director of Climate Change and Green Growth at the AfDB observed that “As we get closer to 2020, the global community needs to double efforts on pre-2020 ambitions on finance because these will determine the level of achievement of the post-2020 actions. Africa’s Intended Nationally Determined Contributions (INDCs) are largely conditional pledges.”

The Bank has set up an Africa Nationally Determined Contributions (NDC) Hub to assist African countries to align their NDCs with national development plans; provide a platform for a concerted, targeted climate finance mobilization effort commensurate with the low carbon and climate resilient development pathway; and to rally, in a coordinated manner, all interested parties around a collaborative effort for NDC implementation across Africa.

Despite the shortfall they face in the receipt of needed climate finance, African nations continue to work to advance on their commitments to create sustainable societies built on climate-friendly energy and climate-resilient development solutions. Cognizant that the continent’s development is intrinsically linked to how well it manages climate threats and opportunities, the AfDB remains committed to working with stakeholders in ensuring that Africa meets its Paris Agreement obligations.

“For its part, the African Development Bank has committed to allocating about 40 per cent of its project approvals across all sectors as climate finance by 2020. Our goal is to ensure Africa efficiently uses its resources both natural and human to safeguard the planet while improving the lives of all its people,” stated Amadou Hott, AfDB Vice-President for Power, Energy, Climate and Green Growth.

The MDBs also reported again on climate finance according to financial instrument. The vast majority of finance, 73 per cent, was provided in the form of investment loans.

The methodologies for climate finance tracking align with the Common Principles for Climate Change Mitigation Finance Tracking, jointly agreed by the MDBs and the International Development Finance Club (IDFC) and first published in March 2015.

The MDBs and the IDFC agreed on the Common Principles for Climate Adaptation Finance Tracking in July 2015. The MDBs and the IDFC have started taking the next steps to harmonize their approaches in tracking adaptation finance.

The MDBs are continuing to work to update their joint tracking methodologies for mitigation and adaptation to support the goals of the Paris Agreement, playing a key role in defining the finance flows consistent with a pathway towards low greenhouse gas emissions and climate resilient development.

Source: GNA/NewsGhana.com.gh

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