2024-01-07 18:21:13
At the climate conference in Dubai at the end of last year Image: dpa
Reforms are needed that reduce risk and increase legal certainty for investors. Otherwise not enough private capital will flow into the fight against climate change. A guest post.
The transformation of the global economy away from fossil fuels can only be achieved with private investment. A major success of COP 28 in Dubai was the commitment to transforming the economy away from oil, gas and coal. The goal and the path are now set. However, the implementation of this transformation will only be successful if financing is secured – especially for the Global South.
A report by the G20 Independent Expert Group has estimated the global investment needed to combat climate change and poverty at $3 trillion annually. These are huge sums. This will not be possible with public funds alone. To finance this massive transformation, private investment will be crucial. For comparison: In Germany, almost 90 percent of gross fixed capital formation in the economy as a whole is private.
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