I was fascinated to read in The Washington Post that peatlands in the Democratic Republic of Congo (DRC), equivalent to the size of Iowa, hold at least as much carbon as the world currently emits in three years of burning fossil fuels. If DRC were to drain its peatlands to convert to farmland, as many developed countries have in past centuries, hundreds of millions or even billions of tons of carbon dioxide would be emitted. Seventy-three percent of Congolese live below the poverty line. Seventy percent of cobalt, essential for rechargeable batteries, comes from the country. According to a recent Dutch study, DRC ranks as the 12th most vulnerable country to climate change and the 5th least prepared.
This illustrates the complexity of the low-carbon transition. , dealing with additional risks, and prioritizing climate-smart investments.
As many countries have committed in their NDC and net-zero targets, For many middle-income countries, it is also about phasing down coal and replacing it with green generation that integrates with their grids and is just for all. In all cases, it involves significant change in how governments and private sectors plan, prioritize, and invest. This may mean addressing vested interests and shaking up entire economies.
The World Bank estimates that developing countries need to invest around 4.5 percent of GDP to achieve infrastructure-related Sustainable Development Goals (SDGs) and to stay on track to limit climate change by no more than 2 degrees Celsius. Studies from the G20’s Global Infrastructure Hub, the United Nations, and McKinsey & Company confirm that the infrastructure financing gap is huge, standing in multiples of trillions per year.
Yet, the current level of all climate-related development financing (from bilateral sources and multilateral development banks, and development finance institution sources) is less than 1.5% of projected needs. The recent record $93 billion replenishment of the World Bank’s fund for the world’s poorest countries (IDA) will provide much needed support. Middle-income countries, which have limited access to concessional funds or sufficient donor funds, also need to urgently roll out key interventions—especially in energy and transport decarbonization and involving new technologies.
In light of this, Scare public funds can be channeled into most-needed areas, while private capital—together with the efficiencies it can bring—assumes its rightful role, spurring economies and growth.
Despite the clear case for private capital, according to the Global Infrastructure Hub’s recently published Infrastructure Monitor 2021, about three-quarters of global private investment in infrastructure occurs in high-income countries. Developing countries attract only a quarter of global investment. Furthermore,
The pathway to financing the low-carbon transition in developing economies is complicated by lower creditworthiness, the nascent state of many sectors, low implementation capacity, lack of bankable projects, and issues around affordability and debt sustainability.
Reaching net zero will require improvements to the enabling environment as well as robust project preparation and tapping different sources of finance in a coordinated manner, taking into account each country’s context.
Governments will need to think through the actions needed to meet their NDC commitments holistically and programmatically for each of the key transitions—starting with decarbonization pathways, policy and sector measures, and culminating in an affordable implementation and financing roadmap. This kind of roadmap will benefit from involving the private sector, incorporating innovative financing approaches as well as a plan for optimal use of very limited public, concessional, and donor resources. Such innovative financing may range from guarantees to mobilizing private sector investment, blended finance facilities for critical state-owned enterprise investments, regional platforms to finance new climate initiatives, and risk sharing to develop local currency finance ecosystems.
One good piece of news to come out of COP26 was the agreement reached on Article 6, regarding a policy framework and rules of international carbon markets. There may now be an opportunity to tap this market as another source of funds. This holds promise for nature-based solutions (such as in the case of the DRC peatlands) as well as coal phase-down and other transitions.
The World Bank is already working on demonstration projects in each of these areas and will build on these as we encounter similar challenges in other countries—sharing our experiences and advocating for more cooperation, thought, and tools along the way.
Meeting the climate agenda’s infrastructure investment needs when public finances constrain: Getting more for less
Leveraging PPPs to tackle climate change – A new resource
Maximizing innovation and finance for coastal resilience in West Africa
Is there a tradeoff between debt sustainability and infrastructure investment?
A simple way to close the multi-trillion-dollar infrastructure financing gap
This blog is managed by the Infrastructure Finance, PPPs & Guarantees Group of the World Bank. Learn more about our work here.
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How does an entrepreneur start up get access to possible funding what programs are available, thanks
RAPHAEL SMITH Jr
NewTech Engineering, Freetown Sierra Leone West Africa.
New and disruptive solutions must be found to reach our goal. Historically nations are willing to promise but slow to deliver on their promises. The time for waffling is past.
Global Energy Nutrition Initiative suggests that we switch from reliance on electricity as our energy carrier to heat. Heat is available everywhere on the planet daily and enables us to deliver energy in the form of heat to everyone without any spending on infrastructure.
Thermal energy can be stored for the long term in varying amounts and in several different forms. The combination of Solar thermal energy and thermal energy storage means that the amount of finance required is reduced and the time needed to implement is also less.
Heat engines can be used to lower the use of polluting internal combustion engines thereby reducing global pollution. Stirling engines may be retrofitted into automobiles to reduce pollution and costs.
To bee in net zero.
1.there must be faithfulness and love.
2.there must be managerial swot analysis.
3.there must be stable prices meeting pricing policy from raw materials to consummers.
4.international business/contract laws must not be breached of its consideration rules.
5.there must be quality qualification of goverment leaders and workers.
6.there must be tag and fixing of prices on goods from producer to consummers.
7.taxs,rates,revenues,interests,profits,excess,duties must be on.
8.birth and marrage rate must be controlled.
9.the laws must be obeyed.
10.bank must control prices.
11.budgets must be planned and approved capital seen and it oppuntunity expected costs,and be actualized for suplus.
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Thanks and regards.