visimoney
TLDR:
- IEA analysis shows world on track for only one-third of necessary carbon emission reductions by 2030
- Current investment in clean energy in developing countries insufficient, needing $2 trillion by 2030
The article discusses the challenge of financing net zero in developing economies to combat climate change. The International Energy Agency (IEA) highlights the need to reduce fossil fuel emissions and triple clean energy investments to limit global warming to 1.5 degrees C. Developing countries, which now emit nearly half of all greenhouse gases, are crucial in achieving net-zero goals by 2050.
Historically, multilateral development banks (MDBs) have played a key role in financing projects in developing economies, but their processes are slow for attracting private investment. To address this, the article proposes a new facility, the emerging market investment compact (EMCIC), to provide financing guarantees to make projects more attractive to private investors.
The EMCIC proposal involves establishing a facility funded by sovereign nations and large corporations to provide at least $500 billion in financing guarantees over ten years. By reducing the perceived risks of investments, the facility aims to attract private institutional investors and make projects more financially viable, ultimately helping developing countries reach their emission reduction goals.
