Following the Paris deal on international climate change, governments are beginning to explore new financing mechanisms for investing in the growing low carbon economy. Over the next decade . Recognizing the untapped potential of SWFs, two key questions emerge: how can SWFs increase their exposure to green asset classes? And what are the constraints?
Investors and financial institutions are becoming increasingly aware of the risks associated with fossil fuel projects and are showing growing interest in green bonds and other financing tools that facilitate investment in low-carbon energy solutions.
Being patient investors, with longer term investment horizons than many others in the financial services sector, . In the November 2016 annual meeting of the International Forum of Sovereign Wealth Funds in Auckland, participants highlighted that SWFs are particularly well-positioned to become trailblazers in green investment. The majority of members are oil-based SWFs which are looking to economic diversification of their finite carbon wealth into industries and sectors that would yield broader societal, economic and financial benefits.
The story begins a world away from Washington. Nicholas Meitiaki Soikan — or Soikan as he’s known to most — was the sixth of seven children in what is considered a small Maasai family from Kajiado county in Kenya.
As a young boy, his mornings were spent herding livestock, mostly cattle that he had names for and considered his pets. He and his siblings went to primary school in shifts, so that meant Soikan’s turn to study was in the afternoon, often under a large acacia tree.
Also available in: French
For over a hundred years, electrical grids have been built with the assumption that electricity has to be generated, transmitted, distributed, and used in real time because energy storage was not economically feasible.
This is now beginning to change.
The case for investing in pandemic preparedness is –or at least, should be - completely compelling. Few things could kill as many people as an influenza pandemic. Few threats can cause as much economic disruption as the contagion of fear triggered by a rapidly escalating epidemic. Reinforcing capabilities such as disease surveillance, diagnostic laboratories and infection control would be more effective and cost far less than spending money to contain outbreaks when they occur. Yet, so far, the global community has demonstrably not invested enough in preparedness. As a result, too many lives have been lost and too many livelihoods damaged, and the world remains scarily vulnerable.
It’s just one month into 2017, and for many, that means they have just launched their New Year’s resolutions. The gym is still crowded, your refrigerator is still full of healthy food, but that initial motivation may not be as high as it was on, say, January 2. So, it’s time to find new sources of motivation and even inspiration for keeping that New Year’s resolution. One place to find that inspiration is the Film4Climate competition. If you’re trying to find a reason to persevere through whatever new challenges you are finding, look no further than the winners of this competition. All these films put things in a unique perspective.
4 unprecedented disruptions to the global financial system
Climate change, migration, correspondent banking and cybercrime are putting unprecedented and unforeseen pressures on global financial markets.
They aren’t just disrupting the global financial system, but also affect how we approach international development work.
Let’s examine each trend:
- “Greening the financial sector” is the new buzz term to finance a transition toward a climate-resilient economy and to help combat climate change. This topic is now getting a lot of attention from the G20 to the Financial Stability Board. The international community is trying to understand what this transition will imply: , and how efficiently the financial sector can allocate financial resources. What we know is that currently fossil fuel subsidies and a lack of carbon tax are hindering the market from shifting financial resources from brown to green.
- Globally, an estimated 65 million people are forcibly displaced. Migration, resettlement or displacement, of course, impact where and how to channel aid to those in need. But more importantly, as displaced people settle down -- no matter how temporary or long-term -- to become self-sufficient and thrive, they will need to establish new financial relations. This can be for simple transactions such as receiving aid through payment cards (as opposed to cash) or for sending remittances. Or it can be for something more complex as getting a loan to start a business.
- At the same time, as the global banking industry is tightening regulations, large banks are withdrawing from correspondent banking and shutting down commercially unsustainable business lines. This recent phenomenon can have a huge impact in some regions on SMEs and on money transfer operators, which largely handle remittances.
- . The focus on cybersecurity risk has increased along with the proliferation of internet and information technology. Fintech is transforming the financial industry -- by extending access to financial services to people and small- and medium-sized enterprises (SMEs) previously left out of the formal financial system – but is also raising many questions, including concerns about cybersecurity. The same technology advancements that are propelling fintech are also addressing cybersecurity risk. However, there is a need to develop an appropriate regulatory framework in combination with industry best practices. This framework is evolving and regulators are grappling with how and when to regulate.
If ever there was a year to make significant progress on forest conservation and climate change, it was 2016. Coming on the heels of the historic COP21 Paris Agreement, 2016 was a year to demonstrate the commitment the World Bank Group has to support countries as they take forward their nationally determined contributions to address our global climate change challenge. It’s gratifying to look back on 2016 and feel that we contributed to harnessing this momentum and sense of urgency; especially in showing how sustainable land use, including sustainable forest management, is critical to achieving the ambitious targets set out in the Paris Agreement.
- capacity building
- forest action plan
- forest conservation
- sustainable land management
- Forest Carbon Partnership Facility
- climate finance
- Climate Change
- Climate Change
- South Asia
- Latin America & Caribbean
- Costa Rica
- Cote d'Ivoire
- Congo, Democratic Republic of
- Congo, Republic of
Last year in Paris, world leaders came together for the first time to commit to keeping global warming below 2°C. With the Paris Agreement in force and negotiators at COP22 in Marrakesh teasing out the details of implementing the Agreement, countries are developing their action plans (or Nationally Determined Contributions, NDCs) to reduce global greenhouse gas emissions. Part of this is looking at how carbon assets could be traded across borders.
We were standing at ground zero in the fight against climate change, looking at a still body of water and talking. Our group was gathered along the edges of a “farm pond,” a technique used by farmers to enhance agricultural resilience to climate change, which often impacts countries through crippling droughts. A farmer demonstrated the measures he had taken to protect his livelihood from the extreme weather events that were increasingly common in his region.