Gland, Switzerland – In preparation for the G20 Summit scheduled for June 26-27 in Toronto, G20 Finance Ministers are meeting in Washington DC from April 22-23. On climate, it is the group’s first meeting following the December UN climate summit and their first opportunity to respond to the outcomes of the Copenhagen climate negotiations, and in particular contribute to meeting the financial commitments made under “The Copenhagen Accord”.
Also on the Finance Ministers’ agenda is the instruction from the June 2009 G20 summit for the development of a plan and time-line to phase out ‘inefficient’ fossil fuel subsidies, including production subsidies.
WWF is anxious to see G20 action to help lay the foundation for an adequate and equitable post-2012 global climate fund, which could move the world towards a sustainable and low carbon growth.
Ending “perverse” subsidies favouring fossil fuels in accordance with the G20s own agenda and resourcing renewable energy development instead will be crucial to both the transition to a clean economy and countering climate change.
“G20 Finance Ministers must discuss the investments needed for the transition to a clean, low-carbon economy, while finding ways to help vulnerable countries build their resilience to the impacts of climate change,” said Mark Lutes, Finance Policy Coordinator for WWF International.
“Shifting subsidies from fossil fuels into renewable energy development is one of the ways forward towards a clean economy.”
“G20 Finance Ministers will need to act on this commitment and provide a plan and time-line to not just phase out but re-direct these subsidies,” he further added.
Key Issues
WWF urges the G20 Finance Ministers to work towards resolving the following issues:
- Redirection of Fossil Fuel Subsidies – Building on the agreement at the G20 meeting in 2009 to remove fossil fuel subsidies, countries should further agree to redirect those subsidies towards clean energy, adaptation, and reducing deforestation.
- Efforts to support low-carbon development in poor countries must be matched by similar steps to ‘de-carbonise’ the global economy. The G20 should put renewable energy investment and energy efficiency at the forefront of their efforts as part of a managed transition towards low-carbon economies.
- Focus on a full range of options on new and innovative sources of finance, including revenue from measures to tackle aviation and shipping emissions, auctioning of Assigned Amount Units (AAU) or allowances in cap and trade systems, special drawing rights (as proposed by IMF) and international Financial Transaction Taxes (FTT) or other instruments. The Finance Ministers are expecting a report on ways of generating revenue from the finance sector from the International Monetary Fund (IMF), which will discuss Financial Transaction Taxes. FTT entail very small levies on international financial transactions such as currency transactions, which could be a significant source of income for climate change action and other purposes.
- G20 Finance ministers should also discuss short-term climate financing and particularly consider how to ensure distribution of the promised USD 30 billion to countries in order to deal with climate change from now to 2012, and ensure that this is truly additional to current Overseas Development Aid (ODA).
- G20 Finance Ministers should discuss long-term climate financing, particularly sources of the $100 billion a year by 2020 as agreed in Copenhagen; these funds are to support climate action in developing countries.
This G20 finance meeting occurs in the same week as climate legislation is set to be introduced in the US Senate. The G20 Finance Ministers should remind the U.S. Senate of the need for the U.S. Climate Bill to include substantial, predictable and long term funding flows including REDD, adaptation and technology cooperation.
The co-chair for the next G20 Summit in June is Canada. Canada is one of the few countries remaining to put forward a fast-track climate financing contribution. Canada must show leadership as host by providing its fair share of at least US$300-400 million per year in new funds from 2010 to 2012.
Source: WWF, April 16, 2010
