The world’s top multilateral development banks (MDBs) have pledged to boost climate finance to low and middle income countries by $120 billion annually by 2030.
The group of 10 MDBs, which includes the World Bank, European Investment Bank and Asian Development Bank, agreed on the target on Tuesday at the ongoing COP29 in Baku, Azerbaijan.
The new figure is a 70 percent increase in the amount the MDBs allocated to poorer nations in 2023. It includes $42 billion for adaptation to the effects of extreme weather.
The banks said their goal is to leverage lending to attract an additional $65 billion in private sector investment.
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The MDBs however warned that their capacity to do more depends on the commitment of shareholders from developed and developing nations.
Reuters reports that during a panel discussion in Baku, Ajay Banga, World Bank president, said trillions of dollars would need to be sourced from the private sector, and he expected that annual private sector contribution would exceed the $65 billion target.
Nadia Calvino, president of the European Investment Bank, noted that the private sector is becoming more involved as it realises that the costs associated with climate change are unsustainable.
“We can spend time just discussing issues, but I think it’s better to get on with it and work as best as possible, together to mobilize green finance, public and private finance, and have maximum impact on the ground,” Calvino said at the meeting.
The United Nations Environment Programme (UNEP) had earlier stated that the gap for annual adaptation financing could range from $187 billion to $359 billion.
At COP29, countries are expected to set a new global finance target to replace the one set in 2009, where developed nations agreed to provide $100 billion annually by 2020 to help developing countries reduce emissions and build climate change resilience.
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