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Multilateral development banks “move away from fossil fuels”

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Multilateral development banks “move away from fossil fuels”

New York City, USA

  • Nine major Multilateral Development Banks (MDBs) have revealed how they are progressing in aligning operations with the Paris Agreement.
  • MDBs have committed to helping their clients “move away from fossil fuels”.
  • The banks also announced they will be contributing USD 65 billion a year by 2025 in climate finance, as well as USD 40 billion a year from the private sector.

Story

In their contribution to the UN Climate Action Summit in New York City today, Multilateral Development Banks unveiled the latest instalment of their long-running process of aligning with the goals of the Paris Agreement. This is a key part of delivering a shift of financial flows to combat climate change. This follows up on a pledge made four years ago in the run up to the Paris Agreement to help implement the international deal.

Development Finance Institutions – both multilateral and bilateral – have the potential to mobilise USD 2.5 trillion per year for sustainable infrastructure, and set standards and norms for the rest of the financial system giving them an important role to play in the global transition to net zero.

Quotes

Kate Levick, Finance Programme Leader, E3G said:

The MDBs collectively recognising the need to move away from fossil fuels, combined with commitments to produce a strategy on just transition and a major increase in funding for climate action, is a welcome move. However, many questions remain as to how this will be implemented. In order to support the MDBs E3G will continue to put forward detailed proposals for how development banks can approach Paris Agreement alignment.

E3G has used the broad “six building blocks” framework for Paris alignment published by the MDBs in December 2018 and broken it down into 16 specific metrics that can be used for judging the level of alignment with the Paris Agreement at international financial institutions.

Available for comment

Kate Levick is Program Lead for sustainable finance and is available for comment in London, UK.

Sonia Dunlop is Senior Policy Advisor on international financial institutions and is in New York City until Wednesday 25 September.

ENDS

Notes to Editors

E3G is an independent climate change think tank accelerating the transition to a climate safe world. E3G specialises in climate diplomacy, climate risk, energy policy and climate finance. In 2018, for the third year running, E3G was ranked the fifth most globally influential environmental think tank by the Global Go To Think Tank Index.

Source: F20 report to the G20, 2019 https://www.foundations-20.org/wp-content/uploads/2019/06/F20-report-to-the-G20-2019_Infrastrucutre-Investment.pdf

For more information see E3G, Banking on Reform, 2018, https://www.e3g.org/library/banking-on-reform-aligning-development-banks-with-paris-climate-agreement


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