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World Bank Paris Agreement

« We welcome the historic agreement that was just reached in Paris, » said Jim Yong Kim, President of the World Bank Group. « The world has come together to forge an agreement that finally reflects the aspiration and seriousness of preserving our planet for future generations. The World Bank Group stands ready to provide immediate assistance and will do everything possible to make this vision a reality. « The global community came together to decide on these goals, and now the World Bank is the institution that helps implement what needs to be done in developing countries, » said Jürgen Zattler, German Executive Director of the World Bank. But it`s not just about stopping funding. The economics of these investments are already sending a strong message about stranded assets. Instead, it`s about ensuring that entire communities aren`t stuck as part of the low-carbon transition. The CCAP speaks of a « carefully managed and fair approach, including safety nets and support for finding new jobs or developing new skills for the green economy. » All over the world, we need to involve workers in the fossil fuel industry – people with families, homes, plans for the future – whom we need to keep at the centre of planning so that they also benefit from the new climate economy of the future. The banks have convened a working group that will hold one of their meetings on Thursday to try to address some of these issues. At the UN climate summit in September, banks issued a joint statement pledging to « develop a new transparency framework to account for both the impact of each SED`s activities and how they help customers meet and exceed the commitments they have made. » They plan to present this framework at the upcoming United Nations Climate Change Conference in Santiago, Chile. The international community is committed to reducing greenhouse gas emissions and taking further action to adapt to climate change.

We see this in countries that announce GHG reduction targets through their Nationally Determined Contributions (NDCs); financiers and investors announcing the alignment of their funding flows with the objectives of the Paris Agreement; Countries and companies committed to net-zero emissions; and announcements, as recently in China, to stop building new coal-fired power plants overseas. We need multilateral development banks (MDBs) to support the creation of bankable projects. Finally, we need partners to help provide public and blended concessional financing to reduce the risk of private investment and reduce the cost of innovation. For example, the IFC will apply a climate lens to all regions and industries in which it operates. It will strive to maximize impact, accelerate the adoption of green finance and the development of capital markets, and work with private companies, including SMEs, to integrate the risks and opportunities of climate change into their supply chains. The first challenge is to achieve a common understanding of what the « Paris Alignment » means for multilateral development banks. Last year, the World Bank committed to achieving important new climate goals, including doubling its climate finance for the next five years to about $200 billion and significantly increasing its support for climate change adaptation. While these promises are welcomed by climate activists, they do not automatically mean that the bank`s overall portfolio is aligned with the goals of the Paris Agreement. Today, the world has a historic opportunity and a need to change course – to overcome the growing dangers of hunger, social division, conflict, violence and climate change. The World Bank Group will work with all stakeholders to address these challenges head-on and help our clients reap the benefits of green, resilient, and inclusive development. It is difficult for MDBs to find institutional positions on what exactly the Paris Agreement requires, as it can vary greatly from country to country, according to bank officials. The agreement is based on a system of « nationally set contributions », so what helps one country move towards a carbon-free economy could be a step in the wrong direction for another.

The Banking Group is also exploring how to create incentives for massive emission reductions by expanding and deepening carbon markets. Since the creation of the world`s first issuance fund, which was supported more than a decade ago, the banking group has raised $4.36 billion through 18 funds and issuance initiatives and supported 145 active projects in more than 75 client countries. The World Bank and other multilateral development banks have sought to position themselves at the forefront of climate finance and support a wide range of activities in low- and middle-income countries. They are now under pressure to show that the big picture of their investments is helping to put countries on low-carbon paths that can meet the goals of the Paris Agreement. For radio inquiries: David W. Young, (202) 473-4691, dyoung7@worldbank.org For the bank, this means that financing a project that involves significant carbon emissions in a country could be compatible with the goals of the Paris Agreement – depending on how the global carbon budget is allocated – while elsewhere the same project could be equivalent to supporting a harmful carbon-emitting industry. As the world ponders ways to increase climate finance, it is crucial to develop high-impact projects and take into account the parameters of trade between providers and users of climate capital. Partnerships and coordination efforts, including through national platforms, and the development of innovative ways to pool the resources of private foundations and companies wishing to meet their net zero commitments will be essential to secure the funds available to achieve impactful results. Regardless of how the multilateral development banks set the direction of Paris, it is clear that there is much at stake for the World Bank to prove that it can play a leading role in helping LMICs achieve their climate goals. In Washington: Ferzina Banaji, (202) 372-5885, fbanaji@worldbankgroup.org He added that from a German point of view, if the bank did not fulfill this role, « much of its legitimacy would lose. » WASHINGTON – The World Bank and other multilateral development banks are trying to find a common definition of what it means to « adapt » to the Paris Climate Agreement.

With the adoption of a global climate agreement on December 12, the World Bank Group is moving quickly to help countries deliver on the commitments they made in Paris. In addition, 760 million people – many of whom live in the poorest countries and are responsible for less than a tenth of global greenhouse gas emissions – do not have access to energy. These countries need to grow faster and develop in a resilient and low-carbon way. They also require significant investments in adaptation and risk management, as they are typically the most affected by extreme weather events and natural disasters. « We can`t say today – are we really oriented towards Paris? The methods to really determine this are evolving even more, » said Peer Stein, Senior Advisor and Global Head of Climate Finance at the International Finance Corporation. David Malpass of the World Bank talks about `decentralization` and private investment « It doesn`t tell you yet whether or not these are in line with the Paris Agreement, » Stein said. How will the CSHF help countries be ambitious? Of course, each country has its own specificities, but there are some major trends that will underpin our support: in low-income countries, where emissions are the lowest but climate impacts are often the greatest, we expect our support to focus on climate-friendly development, avoiding the linking of carbon-rich development pathways, and adaptation and resilience. The latter will be a major priority in small island developing States.

In middle-income countries, many of which are already high-emission, we plan to focus much more on accelerating low-carbon development and supporting a « just transition » to a low-carbon future. At the same time, fossil fuel subsidies are increasing, carbon is taxed too easily, and bold decisions to shut down the existing fleet of coal-fired power plants and stop building new ones are rare. .