One Planet Summit: Finance commitments fire-up higher momentum for Paris Climate Change Agreement
On 12 December at the One Planet Summit, the 2nd anniversary of the Paris Agreement, world leaders gathered once again in the French capital to underscore how financial flows are shifting billions and trillions towards a low-carbon future that will benefit peoples and livelihoods.
Patricia Espinosa, Executive Secretary UN Climate Change, said: “Today has marked another extraordinary moment in the world-wide efforts to turn the promise of the Paris Agreement into a global reality – in other words delivering a climate secure future to all corners of the Earth and contributing to the sustainable future of every man, woman and child”.
“From the United Nations system to governments and investors, billions of dollars have today been mobilized and trillions more pointed towards a transformation of the world’s energy to agricultural sectors, adding to the finance that has already been flowing before, during and since Paris 2015”.
“We know this is going to be a long journey and there will be bumps along the way. But the alignment of so many areas of the global economy, the process to reset the financial system and the support for developing countries’ national climate action plans or NDCs announced today, should give everyone a sense that the urgency needed and the scale required is being forged”.
“We look forward from the UN Climate Conference 2017 in Bonn and the One Planet Summit in Paris, to California, COP24 in Poland in 2018 and the UN Secretary-General’s Summit in 2019 as the world moves to raise ambition further before 2020 under the UN climate change process.”
The conveners of the Summit – French President Emmanuel Macron, World Bank President Jim Yong Kim and UN Secretary-General António Guterres – signed a Declaration to welcome the outcomes of the event, which launched an array of landmark commitments.
These are helping to demonstrate that public and private finance is rapidly being deployed in both developed and developing countries to strengthen sustainable development and assist nations towards achieving their national climate action plans, known as NDCs.
This momentum also represents a broader reshaping of the world’s financial architecture, which will be fundamental to creating the conditions for a successful Talanoa Dialogue next year and the urgency of countries to raise ambition further and faster.
The French government has identified 12 #OnePlanet commitments.
The following list includes announcements made during the One Planet Summit that will help to keep global temperature rises to well below 2 degrees and, in turn, safeguard the meeting of the 2030 Sustainable Development Goals:
EU External Investment Plan: climate-smart investments worth EUR €9 billion unveiled at ‘One Planet Summit’:
As part of the EU External Investment Plan (EIP), which is set to mobilise at least €44 billion of sustainable investment for Africa and the EU Neighbourhood countries by 2020.
Climate Action and Energy Commissioner Miguel Arias Cañete announced climate-relevant investments in three targeted areas – sustainable cities, sustainable energy and connectivity and sustainable agriculture, rural entrepreneurs and agribusiness. These targeted areas are expected to generate up to EUR €9 billion investments by 2020.
Sustainable Finance Facilities: UNEP and BNP Paribas sign a milestone agreement to establish collaborative partnerships with a target of capital funding amounting to USD 10 billion by 2025 in developing countries:
UN Environment and BNP Paribas will collaborate to identify suitable commercial projects with measurable environmental and social impact. The aim is to support smallholder projects related to renewable energy access, agroforestry, water access and responsible agriculture, among other sustainable activities.
The Sustainable Finance Facilities programme is the first of its kind in terms of collaboration between companies, investors, development sector partners, and civil society organisations, with the support of national governments.
This agreement builds on the Tropical Landscapes Financing Facility, a partnership between UN Environment, BNP Paribas, World Agroforestry Centre and ADM Capital in Indonesia.
UN Women: Initiative to boost resilience of women and youth in the Sahel through climate-smart agriculture will transform livelihoods of a million people by doubling their income in three years:
The climate smart agriculture programme will leverage information and communication technologies (ICTs) to provide access to agriculture assets. Using a digital platform, known as ‘Buy-From-Farmers’ or AgriFed, small-scale women and youth farmers will be connected to customers, suppliers, information, markets and finance to help build their economic identity and make them valued entrepreneurs, able to end food insecurity in the Sahel.
UN Women presented the programme, which is among some 12 initiatives showcased at today’s Summit, on behalf of the UN system.
The World Bank to no longer finance upstream oil and gas projects after 2019:
World Bank says it will cease financing upstream oil and gas after 2019, apart from certain gas projects in the poorest countries in exceptional circumstances, where there is a clear benefit in terms of energy access for the poor and the project fits within the countries’ Paris Climate Change Agreement commitments).
The bank also announced it was “on track to meet its target of 28 percent of its lending going to climate action by 2020.”
Financial Disclosure in China: “By 2020 every listed company in China must disclose information on environmental impacts”:
Top green finance official Ma Jun told Climate Finance Day attendees that China wants international support to clean up its investments abroad. Ma Jun explained that without this information, the market cannot determine who is green – or not.
China is also encouraging green investment at home. These range from cheap money for banks that invest in green projects to requiring certain industries to take out pollution liability insurance.
He said that 2020, all companies would be required to disclose information on their environmental impact: “The basic logic is: we need a lot of money for green investments”.
Urban 20: C40 Cities launch U20 initiative to raise the profile of urban issues and enhance the role of cities in the G20 agenda:
Urban 20 (U20) is a new diplomatic initiative, facilitated by C40 Cities, to help cities develop collective messages and inclusive solutions for global issues such as climate action, the future of work and social integration.
The initiative will bring together 30 major cities located in G20 countries, and many other global cities, to raise the profile of urban issues in the G20 agenda and enhance the role of cities in the G20 process.
The inaugural U20 Mayors Summit will meet in Buenos Aires in October 2018, ahead of the G20 Heads of State Summit hosted by Argentina.
The BNP Paribas Foundation and the Bill & Melinda Gates Foundation, under the patronage of the President of France, launch One Planet Fellowship:
The One Planet Fellowship is a USD 15 million 5-year programme designed to support 600 African and European researchers working to help Africa adapt to climate change. It also aims to bolster the African and European scientific community working in this field.
One Planet Fellows will collaborate in research and higher education projects that aim to advance agriculture and climate change issues, funded by the Agropolis Foundation over a five-year period with a budget of USD 5 million.
The full list of announcements is available here.
Together Major Development Finance Institutions Align Financial Flows with the Paris Agreement
Joint IDFC-MDB Statement
The global development agenda is being transformed in fundamental ways. The Sustainable Development Goals (SDGs), agreed upon by the international community, constitute a universal compass, highlighting the need for systemic and collective action for sustainable, equitable and inclusive development for everyone on this planet. The imperative for mobilizing and shifting financial flows, public and private, towards sustainable development was highlighted by the 2015 Addis-Ababa Financing for Development Conference. The Paris Agreement reached at COP21 recognized that all countries and stakeholders must act to combat climate change. Since the Agreement’s entry into force in 2016, the momentum for climate action has become irreversible.
Development Finance Institutions (DFIs) play a pivotal role in scaling up and directing climate finance, and in helping shape the policies and regulations needed to transition to low-carbon, climate resilient development, including achieving net zero emissions in the second half of this century. Development banks – national, regional, international and multilateral – represent some of the largest providers of public finance for sustainable development. Together, they can facilitate and accelerate the implementation of the Paris Agreement, continuously raising their ambitions.
Members of the International Development Finance Club (IDFC) and the Multilateral Development Banks (MDBs) play a fundamental role in directing capital towards sustainable investments by demonstrating the opportunities and potential returns, and by reducing the risks associated with them. At the same time, IDFC members and MDBs can actively contribute to mainstreaming the sustainable development and climate agendas across all sectors, in accordance with their mandates. Their total annual climate finance commitments have increased over the last few years, and continue on an upward trend.
Members of the IDFC and MDBs are increasing their climate financing in mitigation and adaptation. They also continue to: mobilize external investments for climate actions; jointly lead on the transparent tracking and reporting of climate finance flows and impacts; support the implementation of the Nationally Determined Contributions (NDCs); and facilitate activities that transition development to low-carbon and climate-resilient pathways.
Today, at the 2017 One Planet Summit organized in Paris, building on their proven capacity and combining the power of DFIs worldwide and at all levels, IDFC and MDBs commit to deepen their collaboration, with each other and with other interested entities, in order to:
Further embed climate change considerations within their strategies and activities, and promote the mainstreaming of climate action throughout the financial community, inspired by the five voluntary Principles for Mainstreaming Climate Action within Financial Institutions. Specific attention will be devoted to managing climate risk and to the integration of climate resilience and adaptation.
Redirect financial flows in support of transitions towards low-carbon and climate resilient sustainable development. Building on what is already being done, this will increase the overall amount or share of finance that goes towards climate action.
Catalyze investments to address new economic, social and environmental challenges and opportunities related to climate change, in particular by using their capital to mobilize additional private capital and to blend their financing most effectively with other sources to drive climate action and results.
Pursue the development of processes, tools, methodologies and institutional arrangements that make it possible to design and implement climate action at the required scale. This includes reinforcing the collaborative effort between DFIs to improve the quality, robustness and consistency of climate finance tracking and reporting through the sharing of best practices and knowledge and by increasing the transparency and accessibility of their climate finance data. It also involves the development of a common framework for tracking progress towards achieving resilience, to be shared by COP24.
Collaborate with national and sub-national governments in promoting the reduction of greenhouse gas emissions, including through developing sustainable alternatives to fossil fuel investments, based on national circumstances and contexts, and prioritizing the financing of these alternatives. This should involve the implementation of instruments or measures to shift investments to sustainable asset classes, such as: the use of a shadow price of carbon; reporting of greenhouse gas emissions; assessments to avoid the potential for stranded assets; employing measures to avoid deforestation and encourage improved land use; or putting in place more explicit policies to significantly reduce reliance on fossil fuels and rapidly accelerate financing for renewables.
Support the development of enabling policy and regulatory environments, at both national and sub-national levels, in conjunction with the private sector and civil society, while remaining focused on the most vulnerable populations. IDFC members and MDBs will continue to deepen this work and increase country-level coordination between institutions. As per their respective mandates, IDFC members and MDBs will continue to contribute to policy dialogues, develop technical capacities of clients, and strengthen institutions to enable the translation of NDCs into policies, investment plans and financeable programs and projects, as well as into incentives for the business community.
Further support countries and partners to accelerate climate action and ambition by 2020, including the development of long-term 2050 decarbonization pathways and strategies to reach zero net emissions and promote shorter-term actions that provide the building blocks for achieving these longer-term development pathways.
Poverty eradication and sustainable development goals cannot be met unless there is a collective push to address climate change at the same time. To accelerate impact, it is particularly important for all development partners to come together, move forward on their enhanced commitments, and raise the internal and external ambition on climate.
As public actors with long-term mandates, DFIs have a responsibility to contribute to the collective governance and action needed to fight climate change. Turning the Paris Agreement into concrete action requires new cooperative approaches. In this spirit of collaboration, the IDFC members and MDBs are teaming up, two years on from the historic moment at COP21, to reaffirm their joint commitment to align their financial flows with the Paris Agreement.
 The MDBs annually publish the Joint Report on MDBs’ Climate Finance. The 2016 report is available here (pdf). The IDFC reports Green and Climate Finance Data through the Green Finance Mapping reports.