The Summit for a New Global Financing Pact, held in Paris, France, concluded without producing transformative solutions, but it did succeed in kickstarting an important conversation about the financial crises related to climate change and development. This summit, spearheaded by President Emmanuel Macron of France, brought together leaders from both developing and European nations to address the pressing issues faced by poor and vulnerable countries dealing with a combination of interconnected crises.
According to Sunita Narain, director general of the Centre for Science and Environment (CSE), the summit failed to generate groundbreaking solutions but managed to ignite momentum in addressing the climate and development financing crisis. Narain emphasized the urgency of the situation, stating, “Today, the most vulnerable countries, which also need funding for climate mitigation, have a crushingly high debt burden. We can no longer talk about small changes or short-changing the poor. We need answers, and we need them fast.”
Avantika Goswami, the climate change program manager at CSE, attended the summit in person and shared her insights. Goswami acknowledged that the summit’s duration of just a day and a half was not sufficient to solve the complex problems faced by the Global South. However, she highlighted the significance of the summit, which shed light on the magnitude of the crises, the clear demands from developing nations, and the proposed courses of action advocated by developed nations.
Leaders from the Global South who attended the summit expressed their countries’ predicaments and expectations. Ethiopian Prime Minister Abiy Ahmed drew attention to African countries’ unprecedented funding constraints, with public and private debt reaching alarming levels, commodity inflation skyrocketing, and daily meals becoming a major concern for many Africans. Barbados Prime Minister Mia Mottley rallied for fair treatment, emphasizing that developing nations are sinking under the weight of debt and deserve similar support to that provided to countries in the aftermath of World War I and World War II.
The demands of Global South governments revolve around financial system reforms and include increased concessional and grant financing, debt reduction, and debt cancellations for least-developed countries. The Just Energy Transition Partnerships (JETP) were also discussed, with the recognition that each country’s circumstances, the needs of workers and communities, and development goals should be considered to address poverty and unemployment effectively.
At the summit, several announcements were made, but not all received unanimous agreement. The Multilateral Development Banks (MDBs) were a central topic of discussion for financial system reforms, with calls for expanded resources to address transboundary challenges and climate issues. The World Bank introduced disaster clauses for debt deals, allowing debt payments to be suspended in the event of extreme weather events. Additionally, the World Bank unveiled a Private Sector Investment Lab focused on renewable energy and energy infrastructure.
The International Monetary Fund (IMF) announced the fulfillment of its commitment to allocate US $100 billion in Special Drawing Rights (SDRs) for vulnerable nations. The recycling of SDRs from central banks of rich nations to poor countries or MDBs for concessional finance expansion was proposed.
A Euro 2.5 billion Just Energy Transition Partnership deal was announced for Senegal, aiming to increase the share of renewable energy in the country’s electricity mix to 40% by 2030. Calls were made for polluter taxes, including a tax on shipping emissions, and support grew for a financial transactions tax. Colombia and Kenya proposed a Global Expert Review on Debt, Nature, and Climate to assess the impact of debt on countries’ capacity to address climate change and preserve nature. The EU called for increased coverage of global emissions with carbon pricing mechanisms and the allocation of a proportion of revenues to climate finance.
Furthermore, it was suggested that the long-delayed goal of US $100 billion in climate finance would be achieved this year. However, Narain emphasized the need for structural discussions to address the inequities that prevent countries in the Global South from affording the costs of adaptation and mitigation.
Goswami summed up the outcomes of the Paris Summit, expressing disappointment in the lack of response from developed countries to the demands of the developing world. She criticized the offering of false solutions, inadequate debt relief efforts, and attempts to shift responsibility onto the private sector.
The Paris Summit may not have yielded immediate transformational solutions, but it undeniably sparked a crucial conversation that must not be lost. The financial crises faced by the Global South require swift action, collaboration, and a genuine commitment from developed nations to address the pressing challenges of climate change and development financing.


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