Climate Change financing in developing countries hits 31.7bn in 2022 – World Bank
Climate change-related finance to developing countries has reached 31.7bn this year.
This is according to the President of the World Bank, David Malpass.
Delivering a speech at the Stanford Institute for Economic Policy Research (SIEPR), David Malpass, said climate crisis caused by greenhouse gas emissions continues to be relentless on the African Continent.
According to him, climate-related natural disasters are impacting agriculture production and the livelihoods of Africans.
“To support climate action, many developing countries need massive investments, concessional finance, and grants to enable their energy, transport, and agriculture transitions. Large sources of funding are also needed to support adaption and resilience in most developing countries. A principal thrust of our Climate Change Action Plan is to identify concrete impactful projects and policies in these areas and build the financing mechanisms and facilities to help the global community support global public goods in developing countries.
“We’re working with public and private partners, shareholders, and stakeholders on these challenges in the recognition that much more needs to be done in these areas,” Mr Malpass stated.
Touching on the prevailing macroeconomic challenges facing developing economies, Mr Malpass averred the developing world faces an extremely challenging near-term outlook shaped by sharply higher food, fertilizer, and energy prices, rising interest rates and credit spreads, currency depreciation, and capital outflows.
“These shockwaves have hit development at a time when many developing countries are also struggling in other areas: governance and rule of law; debt sustainability; climate adaptation and mitigation; and limited fiscal budgets to counteract the severe reversals in development from the COVID-19 pandemic, including in health and education,” he noted.
Read details of the speech delivered by David Malpass
The Crisis Facing Development – Speech by World Bank Group President David Malpass before the 2022 Annual Meetings
Speech at the Stanford Institute for Economic Policy Research (SIEPR)
It is a pleasure to be here at Stanford. Thank you to the Stanford Institute for Economic Policy Research (SIEPR) and the King Center on Global Development for the invitation.
As we gather in this prestigious institution, a tough reality confronts the global economy – and especially the developing world. A series of harsh events and unprecedented macroeconomic policies are combining to throw development into crisis. This has consequences for all of us due to the interlinked nature of the global economy and civilizations around the world.
The World Bank Group’s mission is to alleviate poverty and boost shared prosperity. We leverage shareholder equity and annual contributions to provide grants and make loans to developing countries to help identify and respond to development challenges. Our financing to developing countries has expanded dramatically in recent years, especially for climate-related finance, which reached $31.7 billion in fiscal year 2022.
Of concern to our mission, our upcoming Poverty and Shared Prosperity report suggests that the deterioration in development progress began well ahead of the COVID-19 pandemic. The report shows that poverty had been steadily declining through the 1990s and 2000s, progress had slowed by 2015, and extreme poverty rose by roughly 70 million when the pandemic hit. The report also shows a 4% decline in global median income, the first decline since our measurements of median income began in 1990.
The developing world is facing an extremely challenging near-term outlook shaped by sharply higher food, fertilizer, and energy prices, rising interest rates and credit spreads, currency depreciation, and capital outflows. Under current policies, global energy production may take years to diversify away from Russia, prolonging the stagflation risk discussed in the World Bank’s Global Economic Prospects report from June 2022.
These shockwaves have hit development at a time when many developing countries are also struggling in other areas: governance and rule of law; debt sustainability; climate adaptation and mitigation; and limited fiscal budgets to counteract the severe reversals in development from the COVID-19 pandemic, including in health and education.
The human consequence of these overlapping crises is catastrophic. The COVID-19 pandemic – which alone led to over six million deaths – geopolitical conflicts, and extreme weather events have hurt countries and people worldwide, with the poor bearing the brunt, especially women and girls.
Evidence by the World Bank shows that 70% of children in low- and middle-income countries are in learning poverty – which is the share of children who are unable to read or understand a basic text by age 10. COVID-19 worsened the global learning crisis and resulted in the worst shock to education and learning in recorded history.
Moreover, new challenges already loom in the form of demographic pressures: by 2030, according to UN population projections, more than 1 in 4 primary-school-age children will live in Sub-Saharan Africa, the region with the highest learning poverty. This indicates that education systems are now further away from reaching quality education for all.
