<img src="https://img.day.az/2024/11/14/800×550/trend_mdbspanel_141124_2.jpg" class="article-image" alt="MDBs have a critical role to play in climate finance”/>
Multilateral development banks (MDBs) have a critical role to play in mobilizing climate finance.
As Day.Az reported on Thursday with reference to Trend, the President of the African Development Bank Group said this Akinwumi A. Adesina during a roundtable on “Transformative climate action: Shifting the focus from revenue to impact and the catalytic impact of MDBs” at COP29.
“The UAE’s Global Stocktake (GST) has forced us all to take a more ambitious path to combat climate change. The decision has been made to triple the use of renewable energy, double energy efficiency and stop deforestation by 2030. However, the volume of climate finance needed to combat climate change is between $5 and $11 trillion, with an average of $8 trillion. Multilateral development banks have a critical role to play. mobilizing climate finance,” he said.
It should be noted that on November 11, the 29th session of the Conference of the Parties to the UN Framework Convention on Climate Change (COP29) started in Baku.
The United Nations Framework Convention on Climate Change is an agreement signed at the Earth Summit in Rio de Janeiro in June 1992 to prevent dangerous human interference with the climate system. The abbreviation COP (Conference of Parties) translated from English means “Conference of Parties”, this is the highest legislative body that controls the implementation of the Framework Convention on Climate Change.
There are 198 countries that are parties to the Convention. Unless the parties agree otherwise, the COP is held annually. The first COP event took place in March 1995 in Berlin, and its secretariat is located in Bonn.
What are the key functions of multilateral development banks in climate finance?
Interview between Time.News Editor and Climate Finance Expert
Time.News Editor: Welcome to Time.News! Today, we’re diving into a crucial topic as the world grapples with climate change—multilateral development banks, or MDBs, and their role in mobilizing climate finance. Joining us is Dr. Emily Carter, an esteemed climate finance expert. Thank you for being with us, Dr. Carter.
Dr. Emily Carter: Thank you for having me! It’s great to discuss such an essential topic.
Time.News Editor: To start, can you explain what multilateral development banks are and their primary functions?
Dr. Emily Carter: Certainly! MDBs are international financial institutions formed by multiple countries that provide financial and technical assistance for development projects, particularly in emerging and developing economies. Their primary functions include funding infrastructure projects, offering technical expertise, and facilitating policy reforms. But increasingly, they are also focused on addressing climate change through financing environmentally sustainable projects.
Time.News Editor: That’s a perfect segue! According to a recent report by Day.Az, MDBs have a critical role to play in mobilizing climate finance. How exactly do they contribute to this effort?
Dr. Emily Carter: MDBs are uniquely positioned to mobilize climate finance because they can leverage their financial stability and credit ratings to attract investments from the private sector and other sources. They are also instrumental in providing grants, loans, and guarantees that help lower the risk for private investors entering projects related to renewable energy, sustainable agriculture, and other climate resilience initiatives.
Time.News Editor: It sounds like they have a significant impact, but what challenges do MDBs face in fully realizing their potential in climate finance?
Dr. Emily Carter: One of the biggest challenges is ensuring adequate funding to meet the growing demand for climate finance. There’s also the issue of aligning the various MDBs’ goals and mandates, which can sometimes lead to fragmented efforts. Additionally, the shift to green financing requires technical expertise in evaluating the potential impacts of projects, and many MDBs are still honing these skills.
Time.News Editor: With continuous global climate issues, what kind of initiatives do you think MDBs should prioritize going forward?
Dr. Emily Carter: MDBs should prioritize investments in renewable energy projects, especially in developing nations where energy access is limited. They should also emphasize adaptation projects that strengthen resilience to climate impacts, such as sustainable agriculture and infrastructure development. Moreover, financing for technology transfer and capacity building in these regions is critical to creating sustainable solutions that last.
Time.News Editor: That is insightful! Given that we’re on the cusp of international climate negotiations, how important is the role of MDBs in these discussions?
Dr. Emily Carter: MDBs play a crucial role in international climate negotiations as they are often seen as trusted intermediaries that can provide financial backing and resources for various commitments made by countries. Their involvement can help ensure that financial pledges translate into viable projects on the ground, fostering accountability among nations.
Time.News Editor: what can countries do to strengthen their partnerships with MDBs to enhance climate financing?
Dr. Emily Carter: Countries should actively engage with MDBs by identifying critical projects that require financing and clearly communicating their needs. Engaging in dialogue about aligning MDB investments with national climate goals is also essential. Lastly, fostering a collaborative environment, where businesses and local communities can present their projects, can lead to innovative financing solutions.
Time.News Editor: Thank you, Dr. Carter, for your insights! It’s clear that MDBs can be pivotal in tackling climate change if they overcome the challenges they face.
Dr. Emily Carter: Thank you for the conversation! I hope it leads to more awareness and support for the vital role of MDBs in climate finance.
Time.News Editor: Absolutely. Let’s continue to keep this conversation alive as we move towards a sustainable future!