This Monday, the Economic Commission for Latin America and the Caribbean (ECLAC) presented a report on the financing needs and policies needed in the region for the transition to a low-carbon and climate-resilient economy, as well as current trends in emissions.
The report, launched in Dubai during the UN Climate Change Conference (COP28), highlights the importance of financing in sectors such as agriculture, livestock and forestry, which account for 58% of greenhouse gas emissions at the regional level. Greenhouse effect.
Currently, financing is mainly aimed at mitigating climate change, at the expense of taking adaptation measures. In 2020, 89% of global climate finance went to climate protection, 8% to adaptation and only 3% to cross-sectional measures.
“Climate change is one of the greatest challenges of our time. ECLAC has been analyzing its impact in Latin America and the Caribbean for years and has come to this conclusion The cost of inaction exceeds the cost of action (…) and that global warming will increase the negative effects of extreme weather events,” warned the Executive Secretary of the Commission.
Multiply the decarbonization rate
José Manuel Salazar-Xirinachs specified that Latin America and the Caribbean have set a goal of reducing emissions by 24% to 29% by 2030, “but to achieve this, the region’s decarbonization rate would have to increase (0.9%).” 4” times faster.”
According to the study, stick to climate protection commitments Investments of between 3.7% and 4.9% of regional GDP per year are also required by 2030.. For comparison, in 2020, climate finance in Latin America and the Caribbean was only 0.5% of regional GDP. “Closing the climate finance gap therefore requires a seven- to ten-fold increase in national and international resource mobilization,” he added.
Investments required by sectors
The document lists, among other things, the necessary investments for the energy transition, the electrification of public transport, mitigation measures to avoid deforestation, the protection of biological diversity, early warning systems and poverty prevention.
Specifically, the necessary investments for mitigation measures would correspond to 2.3% to 3.1% of the region’s annual GDP. These funds must Fund energy and transportation systems and reduce deforestation. The transport sector is the one that requires the most investment.
Adaptation measures, in turn, require between 1.4% and 1.8% of the region’s annual GDP. This includes investments in early warning systems, poverty prevention, coastal zone protection, water and sanitation services and the protection of biodiversity. In this category, the largest amounts are earmarked for water and sanitation, the document says.
Promote employment and sustainable development
Salazar-Xirinachs explained that increasing climate finance can bring other benefits in addition to environmental benefits, including economic and social benefits; In this sense, more Investments in climate protection and adaptation measures would provide an important boost to growthJob creation and social development.
On the contrary, if no action is taken, climate change can lead to losses. “Our work shows that by 2030 The loss of labor productivity due to heat stress could reach 10% in some countries, which would have a direct impact on the region’s growth potential. In addition, the impact of extreme phenomena must be taken into account,” the secretary added.
recommendations
The document highlights the need Direct investment flows into activities that boost the sectors that drive the economyto achieve more productive, inclusive and sustainable development.
In this sense, ECLAC has identified several relevant sectors and areas with opportunities for economic growth, including the energy transition, electromobility, the circular economy, the bioeconomy, the pharmaceutical industry, digital services and digital care.
It also specifies various instruments, such as: CO2 pricing and the inclusion of climate change in the environmental impact assessment of projects.