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G20 waters down experts' climate finance report, despite UN pressure to act

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G20 waters down experts' climate finance report, despite UN pressure to act

A climate and finance report by independent economists was toned down after feedback from G20 nations, even as the UN says they must all slash emissions

As UN chief António Guterres called on the G20 to “lead” on climate, Climate Home can reveal that the group of big countries watered down a report by top economists on how the financial system should shift to enable climate action.

Guterres made his comments by video at the launch of the United Nations’ Emissions Gap Report which showed that, under their current policies, the G20 countries as a group will fail to meet their 2030 targets to cut planet-heating emissions.

Separately, Climate Action Tracker has found that no G20 country’s policies are compatible with limiting global warming to the Paris Agreement goals of either 1.5 degrees Celsius or “well below” 2C.

“The largest economies – the G20 members, responsible for around 80% of all emissions – must lead,” Guterres said on Thursday.

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He spoke as officials from G20 climate and finance ministries and central bankers gathered in Washington DC to attend a meeting of the G20 Taskforce on a Global Mobilization against Climate Change (TF-CLIMA), an initiative of the Brazilian G20 presidency aimed at bringing climate and finance officials out of their silos to talk about tackling climate change.

One of their tasks is to react to a report the taskforce commissioned from a group of 12 independent experts, led by economists Vera Songwe and Mariana Mazzucato, on how the G20 countries can shift their financial systems towards tackling climate change.

Brazil’s Secretary for Climate, Energy and Environment André Aranha Corrêa do Lago told a briefing for journalists on Wednesday that the experts were requested to do a “strong report”, going beyond what the G20 can agree to in a joint declaration. It was “important to leave as a legacy a document that shows that we believe that more is needed”, he said.

The report, published on Thursday, lists five “myths” blocking climate action, including that it will slow economic growth and that governments lack the resources to fix climate change and should leave it to the market. It recommends that G20 governments should implement green industrial strategies, reform the global financial system and scale up financing for climate projects.

Weakened after criticism

However, according to a draft of the report from September 4 seen by Climate Home, the final, public version was watered down in response to critical feedback from G20 governments through their negotiators.

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Comparing the earlier and later versions, there was a weakening of various points – from criticism of the G20 to warnings over climate impacts, praise for a billionaires’ tax for climate and calls for central banks to help fight climate change.

References to “G20 inaction” were replaced with “G20 inertia”, and the line “each year the destruction to the planet is harsher than the last” was deleted. A reference to a “stark increase” in global temperatures was softened to “a temperature increase on this scale”.

European Central Bank holds back plan to boost climate finance for Africa, Latam

Information in support of Brazil’s proposal for a 2% tax on the wealth of billionaires worldwide was also cut, including a description of the idea’s popularity with “electorates around the world”. An observation on the proposal’s “relatively straightforward” nature to implement was replaced by “questions over the feasibility of implementation”.

The September draft said France, Spain and South Africa supported the wealth tax proposal “while the US opposes it”, but this was deleted from the final version. The US has not made its position on the tax clear in public.

In addition, a recommendation that central banks and supervisory and regulatory bodies should mitigate climate-related financial risks and help mobilise private finance for green investments was modified with the caveat “within their mandates”.

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A source with knowledge of discussions told Climate Home that the recommendations on central banks had been criticised by the US, EU and France, and some developing countries.

Just transition?

On the same day, the UN Emissions Gap report warned that the 1.5C goal will be gone within a few years unless all countries collectively commit to cut 42% off annual greenhouse gas emissions by 2030 and 57% by 2035 in their next round of national climate plans due by next year – and back them up with rapid action.

The report showed that global greenhouse gas emissions set a new record high of 57.1 gigatonnes of CO2 equivalent in 2023, a 1.3% increase from 2022 levels, with rises in sectors from power to transport and agriculture. Guterres said emissions needed to fall 9% each year to 2030 to meet the 1.5C limit and “avoid the very worst of climate change”.

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The report said all G20 governments must step up efforts and “do the heavy lifting” by reducing the group’s collective emissions – accounting for 77% of the global total – dramatically.

But it argued that stronger international support and more climate finance will be essential to ensure that climate and development goals can be realised fairly across G20 member countries, as well as globally.

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The G20 includes some developing countries – like India, Indonesia and Brazil – that, despite being large and rising emitters today, have relatively low levels of emissions per capita and have historically contributed far less than rich, industrialised nations to global warming.

In response to a question from Climate Home, UN Environment Programme Executive Director Inger Andersen told journalists that the Emissions Gap Report recognises that some countries have a higher ability to move first, but emissions cuts are needed by all G20 nations.

“Every G20 country, irrespective of where it stands on the long historical trail, has an opportunity to lean into this investment opportunity and change its emissions structure,” she said. UN chief Guterres has nonetheless called on the wealthier ones to stretch and do even more, to leave space for those who will find it harder to meet net-zero emissions by 2050, she added.

Anne Olhoff, chief scientific editor of the report, noted that all G20 countries apart from Mexico, have made pledges to reach net-zero emissions later this century. She said those that have yet to peak their emissions – China, India, Indonesia, Mexico, Saudi Arabia, Republic of Korea, and Türkiye – should do so as soon as possible, and then start cutting them rapidly in order to meet their net-zero targets.

(Reporting by Joe Lo; additional reporting by Megan Rowling; editing by Megan Rowling)

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Cop29: $250bn climate finance offer from rich world an insult, critics say

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Cop29: 0bn climate finance offer from rich world an insult, critics say

Developing countries have reacted angrily to an offer of $250bn in finance from the rich world – considerably less than they are demanding – to help them tackle the climate crisis.

The offer was contained in the draft text of an agreement published on Friday afternoon at the Cop29 climate summit in Azerbaijan, where talks are likely to carry on past a 6pm deadline.

Juan Carlos Monterrey Gómez, Panama’s climate envoy, told the Guardian: “This is definitely not enough. What we need is at least $5tn a year, but what we have asked for is just $1.3tn. That is 1% of global GDP. That should not be too much when you’re talking about saving the planet we all live on.”

He said $250bn divided among all the developing countries in need amounted to very little. “It comes to nothing when you split it. We have bills in the billions to pay after droughts and flooding. What the heck will $250bn do? It won’t put us on a path to 1.5C. More like 3C.”

According to the new text of a deal, developing countries would receive a total of at least $1.3tn a year in climate finance by 2035, which is in line with the demands most submitted before this two-week conference. That would be made up of the $250bn from developed countries, plus other sources of finance including private investment.

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Poor nations wanted much more of the headline finance to come directly from rich countries, preferably in the form of grants rather than loans.

Civil society groups criticised the offer, variously describing it as “a joke”, “an embarrassment”, “an insult”, and the global north “playing poker with people’s lives”.

Mohamed Adow, a co-founder of Power Shift Africa, a thinktank, said: “Our expectations were low, but this is a slap in the face. No developing country will fall for this. It’s not clear what kind of trick the presidency is trying to pull. They’ve already disappointed everyone, but they have now angered and offended the developing world.”

The $250bn figure is significantly lower than the $300bn-a-year offer that some developed countries were mulling at the talks, to the Guardian’s knowledge.

The offer from developed countries, funded from their national budgets and overseas aid, is supposed to form the inner core of a “layered” finance settlement, accompanied by a middle layer of new forms of finance such as new taxes on fossil fuels and high-carbon activities, carbon trading and “innovative” forms of finance; and an outermost layer of investment from the private sector, into projects such as solar and windfarms.

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These layers would add up to $1.3tn a year, which is the amount that economists have calculated is needed in external finance for developing countries to tackle the climate crisis. Many activists have demanded more: figures of $5tn or $7tn a year have been put forward by some groups, based on the historical responsibilities of developed countries for causing the climate crisis.

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This latest text is the second from an increasingly embattled Cop presidency. Azerbaijan was widely criticised for its first draft on Thursday.

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There will now be further negotiations among countries and possibly a new or several new iterations of this draft text.

Avinash Persaud, a former adviser to the Barbados prime minister, Mia Mottley, and now an adviser to the president of the Inter-American Bank, said: “There is no deal to come out of Baku that will not leave a bad taste in everyone’s mouth, but we are within sight of a landing zone for the first time all year.”

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US Treasury Selects BNY as Financial Agent for Direct Express Program | PYMNTS.com

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US Treasury Selects BNY as Financial Agent for Direct Express Program | PYMNTS.com

The Bank of New York Mellon (BNY) will serve as the financial agent for the Direct Express program, which provides 3.4 million Americans with a prepaid debit card to receive monthly federal benefits.

The U.S. Department of the Treasury’s Bureau of the Fiscal Service said in a Thursday (Nov. 21) press release that it selected BNY for this role after evaluating proposals from multiple financial institutions and seeing the bank’s offering of features and customer service options.

The new agreement will begin Jan. 3 and will last five years, according to the release.

“Since 2008, the Direct Express program has paid federal beneficiaries seamlessly, inclusively and securely, while sparing taxpayers and customers the costs and risk associated with cashing paper checks,Fiscal Service Commissioner Tim Gribben said in the release.This new agreement will further our goals of delivering a modern customer experience and strengthening Treasury’s commitment to paying the right person, in the right amount, at the right time.”

With this agreement, BNY will add to the cardholder experience features like online/digital funds access, bill pay, cardless ATM access, omnichannel chat and text customer service, online dispute filing and in-person authentication options, the bank said in a Thursday press release.

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“Drawing on our leading platform capabilities, we look forward to advancing the program’s goal of providing high-quality financial services to individuals and communities throughout the U.S.,Jennifer Barker, global head of treasury services and depositary receipts at BNY, said in the release.

Seventy-seven percent of the recipients of disbursements opt for instant payments when given the option, according to the PYMNTS Intelligence and Ingo Payments collaboration,Measuring Consumers’ Growing Interest in Instant Payouts.”

That’s because consumers looking for disbursements — paychecks, government payments, insurance settlements, investment earnings — want their money quickly, the report found.

In October, the Treasury Department credited the Office of Payment Integrity, within the Bureau of the Fiscal Service, with enhancing its fraud prevention capabilities and expanding offerings to new and existing customers.

The department said itstechnology and data-driven” approach allowed it to prevent and recover more than $4 billion in fraud and improper payments, up from $652 million in 2023.

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Islamic finance: a powerful solution for climate action – Greenpeace International

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Islamic finance: a powerful solution for climate action – Greenpeace International

Across the globe, Muslim communities find themselves disproportionately affected by climate change, with extreme weather events, rising food insecurity, and other climate impacts taking a toll on their livelihoods, cultural practices, and spiritual life. 

In the last few years, devastating floods swept through Pakistan, affecting millions, displacing thousands, and leaving entire communities struggling to rebuild. In Indonesia, one of the world’s most populous Muslim-majority countries, rising sea levels threaten to submerge coastal villages and erode vital agricultural lands. Meanwhile, in parts of the Middle East and North Africa, persistent droughts and water scarcity are increasing pressures on already fragile ecosystems and economies.

Pakistan’s 2022 monsoonal floods affected 33 million people across the country and claimed more than 1730 lives. Climate change has been identified as a contributing factor to the increasing frequency and severity of floods in Pakistan.

The climate crisis is having a profound impact on the daily lives and religious practices of millions of people

These climate pressures extend beyond immediate threats to survival. Climate change has also begun affecting food security in Muslim-majority regions, especially during Ramadan, a holy month where fasting is practised from dawn until dusk. In communities already grappling with the impacts of droughts or floods, maintaining food stocks for Ramadan can become a significant challenge. In Somalia, where cycles of drought and flash floods have eroded food systems, many families are forced to navigate long-standing shortages, with climate-induced shocks compounding existing vulnerabilities.

August 2019: A member of Greenpeace Indonesia’s Forest Fire Prevention (FFP) team holds a carbon monoxide meter as Muslims attend Idul Adha prayers at Darussalam Mosque. Haze from forest fires blankets the area in Palangkaraya City, Central Kalimantan, Indonesia. High atmospheric carbon dioxide levels, combined with deforestation-induced dry conditions, further exacerbate these fires. © Ulet Ifansasti / Greenpeace

Food insecurity is a worsening crisis as global warming affects harvests, disrupts fisheries, and drives up food prices, making the observance of Ramadan particularly strenuous, both physically and economically. This brings climate change into the daily lives and religious practices of millions in profound ways, reminding us that the climate crisis is as much a social and economic issue as it is an environmental one.

Islamic finance: a financial system grounded in ethical responsibility

Islamic finance has been operating in the global financial system for decades, providing an ethical foundation rooted in Islamic principles that promote fairness, social responsibility, and environmental stewardship.

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Islamic Social Finance for Climate Action at COP 28 in Dubai. © Marie Jacquemin / Greenpeace
December 2023, COP28: An Islamic Social Finance For Climate Action event co-hosted by UNHCR and Greenpeace MENA (as part of the Ummah for Earth Alliance) explored the critical role of Islamic Social Finance in addressing global humanitarian and climate challenges. © Marie Jacquemin / Greenpeace

Ethical banking is a core pillar of Islamic finance. Through principles like zakat (charity) and waqf (endowment for public good), Islamic finance encourages financial activity that uplifts communities, supports sustainable projects, and avoids investments in industries harmful to people and the planet. 

Many Islamic financial institutions in countries like Malaysia, the United Arab Emirates, and Saudi Arabia already support projects aimed at protecting the environment and enhancing social welfare. Success stories are already emerging. Malaysia’s green sukuk initiative has mobilised billions for renewable energy projects, while the UAE’s recent US$3.9 billion in green sukuk issuance demonstrates growing momentum. Saudi Arabia’s Vision 2030 has allocated US$50 billion for renewable initiatives, targeting an emissions reduction of 278 million tons by 2030. 

A US$400 billion opportunity for climate action

While Islamic finance principles already provide a framework that aligns well with sustainability, there is still much room to strengthen its role in addressing the climate crisis, enhancing resilience in vulnerable communities, and shifting investments towards clean, renewable energy.

A new report by Greenpeace Middle East & North Africa (MENA) (as part of the Ummah For Earth Alliance) and the Global Ethical Finance Initiative (GEFI), highlights the transformative potential of Islamic finance in accelerating the global transition to renewable energy and addressing the triple planetary crisis: climate change, pollution, and biodiversity loss.

The report shows that the Islamic finance industry continues its robust expansion, with assets projected to reach USD$ 6.7 trillion by 2027, and that a strategic allocation of just 5% toward renewable energy and energy efficiency initiatives could mobilise approximately USD$ 400 billion by 2030 – a transformative sum for climate-vulnerable regions.

In the build up to COP26, in October 2021, the Ummah for Earth alliance delivered a message to world leaders through a projection on the Glasgow Central Mosque close to the conference venue. The coalition solarised the Glasgow central mosque with around 120 solar panels. © Ummah For Earth / Greenpeace MENA
In the build up to COP26, in October 2021, the Ummah for Earth alliance delivered a message to world leaders through a projection on the Glasgow Central Mosque close to the conference venue. The coalition solarised the Glasgow central mosque with around 120 solar panels. © Ummah For Earth / Greenpeace MENA

Islamic finance can help foster climate-resilient infrastructure, restore and protect biodiversity, and finance climate adaptation projects in at-risk communities. By explicitly directing funds away from fossil fuels and into green energy projects, Islamic financial institutions like the Islamic Development Bank (IsDB) can lead by example, especially in regions that are both vulnerable to climate impacts and hold significant influence in the global fossil fuel market. These institutions must accelerate their commitment to renewable energy investments.

As climate impacts intensify, Islamic finance offers a bridge between faith-based values and practical climate solutions. The convergence of Islamic finance and climate action represents more than a financial opportunity – it’s a moral imperative aligned with Islamic principles of environmental stewardship (khalifah) and balance (mizan).

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Islamic finance, grounded in ethical principles and community responsibility, has a unique role to play in the global climate movement, particularly in the Global South. For millions across the globe, this form of finance offers a culturally relevant and powerful instrument to not only protect their communities from the worsening climate crisis but to promote environmental and economic sustainability in ways that align with their beliefs. Islamic finance offers a bridge between economic strength and ethical stewardship, creating pathways toward a more equitable and sustainable world for all.

November 2024 - Islamic Finance & Renewable Energy Greenpeace MENA (member of the Ummah For Earth alliance), GEFI

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