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Private sector involvement is no silver bullet to the climate crisis

United Kingdom
The Guardian

The private sector has a role to play in tackling climate change, but governments must not lose sight of the reality that only grant-based public funding can reach the most vulnerable communities, says Sarah Best, from Oxfam.

The international development secretary, Andrew Mitchell, has rightly identified that the private sector has a crucial role to play in tackling climate change.

Poor countries need access to energy to develop. Some 1.6 billion people worldwide have no access to electricity and nearly 3 billion people cook with low quality biomass fuels – such as dung, agriculture residues and charcoal - often on open fires. Indoor air pollution from cooking this way leads to 1.5 million premature deaths a year – making it a bigger killer than malaria.

But climate change means poor countries must now pursue more expensive development paths. Huge sums are needed from business to help make the global transition to a low carbon economy.

Public finance can play a crucial role in leveraging private finance to channel investments into low-carbon markets that investors currently see as too risky.

A priority must be to ensure this money doesn't just focus on expanding opportunities for British companies and other wealthy organizations, but instead on overcoming market barriers to the types of clean technologies and investments that really deliver for poor people – the people who are least responsible for causing the problem.

However, we need to be clear that private sector involvement is no silver bullet to the climate crisis.

The priority for the world's most vulnerable countries is adapting to the impact of climate change, such as flash floods, rising sea-levels or drought. Through our work in some of the world's poorest countries, Oxfam is helping to build the resilience of ordinary people to these problems. For example, in southern Bangladesh farmers can now get better weather information and, therefore, plan ahead before the flooding starts. Elsewhere efforts are being made to improve the organic content of soils to reduce water retention and flooding, and trees are being planted through reforestation projects.

All are simple, effective solutions. But in many cases companies will simply not invest in these sorts of projects because they will bring little or no financial return. In the rising fervor over private finance for low-carbon development, governments must not lose sight of the reality that only grant-based public funding can reach the most vulnerable communities struggling to adapt to climate change.

The big political issue is, therefore, how we get reliable, sustainable sources of public financing for adaptation. At Copenhagen, there was some progress on finance, as rich countries pledged to contribute $100bn per year by 2020 to fund adaptation and low-carbon pathways in developing countries.

But in Copenhagen, then, as now, it was unclear where that money was going to come from.

Given the current economic climate, we understand it cannot come from general taxation, but, equally, we need to be sure that the money does not come from aid budgets, which have already been pledged for other urgent development needs, such as schools and health clinics.

There are many innovative ways money can be raised, for example through the introduction of a "Robin Hood" tax on banks or through fair levies on uncapped emissions from international shipping and aviation.

These ideas have been on the table now for some time, but we need clear backing from the UK government on making them happen. We urge Andrew Mitchell and Chris Huhne, the energy and climate change secretary, to work with other world leaders to make them a reality.

The UN climate talks start in Cancun in less than a week. Although there is not the same level of expectation as there was at Copenhagen last year, progress on how the $100bn will be raised and the setting up a Global Climate Fund is not only possible, but crucial for re-establishing confidence in the UN negotiations and for ensuring the money is directed towards helping those who need it most - the poor people on the frontline of climate change.

* Sarah Best is policy adviser on low carbon development at Oxfam

El contenido de las noticias que se presentan en esta sección es responsabilidad directa de las agencias emisoras de noticias y no necesariamente reflejan la posición del Gobierno de México en este u otros temas relacionados.


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