Green Living Association

The Summit for a New Global Financing Pact June 22-23, 2023

Hundreds of representatives from about 80 countries gathered in Paris to talk about rebuilding a monetary system many say is ill-suited to a changing planet.

The aim of the two-day climate and finance summit ending Friday in Paris was to set up concrete measures to help poor and developing countries whose predicaments have been worsened by the devastating effects of the COVID-19 pandemic and the war in Ukraine better tackle poverty and climate change.

Even though the gathering of world and financial leaders has no mandate to make formal decisions, French President Emmanuel Macron has pledged to deliver a to-do list that should be accompanied by a progress-tracking tool.

“We have to come up with mobilizations, commitments, new instruments and very concrete solutions that will change life on the ground in countries facing these challenges,” Macron said.

U.S. climate envoy John Kerry was on the same wavelength, telling The Associated Press the conference would aim to “come out with some results that are specific to how you can mobilize finance” in a bid to reduce emissions faster.

Several activists and non-governmental organizations have urged the summit participants to ensure that rich countries commit to debt relief for poor nations, including the cancellation of loans. A debt suspension clause for countries hit by extreme climatic events was also discussed.

In addition, the idea of implementing a tax on the greenhouse gas emissions produced from international shipping has been gaining traction, with possible adoption at a July meeting of the International Maritime Organization. Some experts believe that a tax on shipping alone could raise $100 billion a year, and a strong declaration on this in Paris might provide Macron with a symbolic win, especially if it gets backing from the IMO next month.

To bring in more money, activists are pushing for a tax on the fossil fuel industry and another one on financial transactions — but those two proposals appear to have little support from wealthier nations.

Ineza Grace, a young climate activist from Rwanda, said a good outcome for the summit would be the emergence of a new vision in developed countries for what they need to do.

“To understand how they can replace the current financial structures that are reproducing the colonial structure,” she said.

Fellow activist Greta Thunberg, speaking alongside Grace on the sidelines of the meetings, agreed.

“The aspect of climate justice and equity has been more or less excluded from the global climate negotiations and the discourse,” Thunberg said.

The summit’s first day included announcements of a pair of deals. French officials said debt-burdened Zambia reached a deal with several creditors including China to restructure $6.3 billion in loans. And Senegal reached a deal with the European Union and western allies to support its efforts to improve its access to energy and increase its share of renewable energy to 40% by 2030.

Many officials from poor and climate-vulnerable nations attended, with only two top leaders from the Group of Seven most developed countries — Macron and German Chancellor Olaf Scholz — in the audience.

The U.S. was represented by Treasury Secretary Janet Yellen and climate envoy John Kerry. Other attendees included China’s Prime Minister Li Qiang, Brazil’s President Luiz Inácio Lula da Silva, European Commission President Ursula von der Leyen, World Bank head Ajay Banga and IMF President Kristalina Georgieva.

Last November, Ms. Mottley sketched out a proposal for financial reform from the stage of the United Nations climate change summit, known as COP27, in Sharm el Sheikh, Egypt. She and her team called it the Bridgetown Initiative.

Ms. Mottley described the financial systems created three-quarters of a century ago as “imperial,” set up as they were before many countries in the world had become independent. She called for a major overhaul so that developing countries most prone to climate change disaster — and already facing debt crises — could access capital to address poverty and damage, and to pay for their transition to a green economy.

“Yes, it is time for us to revisit Bretton Woods,” Ms. Mottley said.

The response was resounding, if unexpected: Kristalina Georgieva, the head of the I.M.F., endorsed the need for reforms. Mr. Biden’s special envoy for climate, John Kerry, announced that he, too, was on board. So did the chief executive of Bank of America.