Climate change: Guterres advocates global finance reform to support developing countries

António Guterres, United Nations secretary-general, has called for a reform of the global financial system, to support developing countries.

Guterres spoke on Monday, at the ‘international conference on climate resilient Pakistan’.

He said loss and damage from the impact of climate change disproportionately affects countries least responsible for the climate crisis.

“There is loss, there is damage. The devastation of climate change is real,” he said.

“From floods and droughts to cyclones and torrential rains, as always, those countries least responsible are the first to suffer.”

Citing the 2022 Pakistan floods that affected over 33 million people, Guterres said it was a question of justice for Pakistan to receive sufficient support.

He said he is “deeply frustrated that global leaders are not giving this life-or-death emergency the action and investment it requires”.

The UN chief, who said the body is actively pursuing a global financial reform, said the international banking system needs to be reformed in order to provide finance for developing countries.

“It is very clear that the present system is biased. The system was conceived by a group of rich countries and naturally it basically benefits rich countries,” he said.

“So, we need, first of all, to recognise that we have presently a situation in the developing world in which countries are strangled by debt and countries have no access to the financial resources they need in order to be able, not only to address the dramatic challenges they face, but also to implement the Sustainable Development Goals.

“Private finance today is only accessible to many developing countries at very high interest rates that do not allow for the solution of their problems.

“So, multilateral development banks, even beyond their loans, need to provide more guarantees to bring private finance at reasonable cost, must be first risk takers and coalitions of financial institutions to support developing countries, and this is true in relation to situations like Pakistan.”