COP27 developing countries require $1 trillion per year for climate finance

• COP27 developing countries must collaborate with investors, wealthy nations, and development institutions to raise $1 trillion per year in external financing.
• The report was released before discussions on climate change finance at the COP27 summit in Egypt.
• It was projected that the yearly investment needs of emerging countries would reach $2.4 trillion by 2030.

A report released on Tuesday stated that the COP27 developing countries must collaborate with investors, wealthy nations, and development institutions to raise $1 trillion per year in external financing for climate action by the end of the decade, in addition to their own cash.

The report, which was released before discussions on climate change finance at the COP27 summit in Egypt, stated that funding was necessary to reduce emissions, increase resilience, address climate change-related damage, and restore the environment and land.

According to a report commissioned by the current and previous climate summit hosts, Egypt and Britain, “The world needs a breakthrough and a new roadmap on climate finance that can mobilize the $1 trillion in external finance that will be needed by 2030 for emerging markets and developing countries other than China.”

It was projected that the yearly investment needs of emerging countries would reach $2.4 trillion by 2030, with half coming from external financing and the remainder from domestic public and private sources.

The current investment level is approximately $500 million, as stated.

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It was said that the largest increase should come from the private sector, both domestically and internationally, while yearly flows from development banks should be treble. Increase the number of concessional loans, which offer more favorable conditions than the market.

Vera Songwe, one of the report’s authors, stated that “unlocking substantial climate finance is the key to solving today’s development challenges.”

“This means countries must have access to affordable, sustainable low-cost financing from the multilateral development banks to help crowd in investments from the private sector and philanthropy.”

On Wednesday, delegates at the climate summit in Egypt are anticipated to focus on funding difficulties.

The report also calls for grants and low-interest loans from the governments of industrialized nations to grow from $30 billion annually now to $60 billion annually by 2025, a doubling from their current level.

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