UNITED NATIONS (CMC) – Jamaica says it believes a partnership approach is required in order to generate the type of response needed to create long-term mobilisation of the financial resources small island developing states (SIDS) urgently need to deal with the impact of climate change.
Prime Minister Andrew Holness, addressing a luncheon here, said that for Jamaica, it was important to emphasise the term partnership even before talking about climate finance.
He said this was necessary because “we believe a partnership approach would generate the type of response across countries necessary to create long-term mobilization of the financial resources small island developing states and least developed countries (LDCs) urgently need to prepare, adapt and indeed thrive in the wake of climate change.”
The luncheon is among a series of activities marking the first ever United Nations Secretary-General’s Climate Action Summit and Holness said that the presence of so many world leaders and key stakeholders is testament to the importance the international community attaches to climate finance.
He said within the context of the Climate Action Summit, Jamaica has submitted to the UN Secretary-General, a plan to enhance its 2020 Nationally Determined Contribution (NDC); which includes more ambitious targets for renewable energy, emissions reductions, sustainable land use and forest management, low carbon transport, increased investments in sustainable infrastructure and enhanced fiscal resiliency.
“However, our NDCs can rapidly turn into wishful thinking if the right blend and scale of financial resources are not in place to catalyze public and private sector investments in climate smart solutions,” Holness said, noting that “we have the right mechanism in place to support the rapid financing of sustainable, low carbon projects in developing countries and to help these countries adapt to climate change.
“As we have all worked directly or indirectly to create this financing mechanism, the Green Climate Fund (GCF) is truly our Fund.”
But he said an ambitious and successful replenishment will enable the Green Climate Fund to fulfil its role of channelling adequate and predictable climate finance to where it is most needed.
“I am confident that our fund will continue to respond to the needs and ambitions of developing countries. But we need to place it in a position to effectively do so,” he said, reflecting on the GCF’s resource mobilisation strategy for SIDS and LDCS.
He said the Inter-Governmental Panel on Climate Change (IPCC) 1.5 Special Report is critical for members of the Association of Small island States (AOSIS) where the impacts of climate change are acute.
“It is not an overstatement to say that for SIDS, climate risks are more significant than previously assessed, loss and damage to critical infrastructure are reaching critical levels as temperatures rise, marine and coastal ecosystems have sustained irreversible loss, and our people live with the fear of the effects of more frequent and extreme weather events.
“Moreover, our physical exposure to climate risk negatively affects our fiscal balances and debt sustainability, which in turn degrades our international credit ratings, making it more difficult for our countries to access the international capital market on affordable terms.”
Holness said that given these circumstances, “we look to our Green Climate Fund to finance our climate-related public investment needs as it is structured to operate with a comparatively higher risk appetite than many private funds.
“I therefore recommend and encourage its leadership to promote and pilot new and innovative approaches to climate financing, including climate debt swaps, credit enhancement instruments and insurance structures. For us, loans are no longer a feasible option, as even at concessional rates they further distort our external debt profiles, thereby exacerbating our macro-economic imbalances.”
He said in moving towards the next programme cycle, and while the pipeline of projects in the GCF’s Simplified Approval Process (SAP) continues to lengthen, he is encouraging the Fund to ensure that SIDS and LDCs benefit equitably from this pilot scheme.
“I also urge the Fund to ensure that its review process is further simplified. Our communities that are being impacted have tried and proven innovative solutions that can easily be scaled-up and transformed into national programmes. But we need to empower them”
The Jamaican prime minister said recent reports suggest that the total financing needs in SIDS and LDCs could potentially reach US$4.4 trillion, with an annual estimated financing need of US$349 billion US dollars per year.
“Colleagues, we are just starting to fully grasp the scale of the adaptation financing needs as climate related events become more frequent and severe. With a well replenished GCF, I believe investment and innovation in climate action will increase exponentially. I, therefore, implore our partners with the ability and resources to do so to place the GCF in a position to support the exponential increase in climate financing demand.”
Holness said developed country partners have committed to mobilising the long overdue and likely underestimated, US$100 billion per annum from public and private sources and praised the leadership shown by Norway, which has pledged to double its contribution to the GCF.
“This type of serious effort and bold leadership is what is required,” Holness added.