February 25, 2024

MediaBizNet

Complete Australian News World

African leaders are calling for new global taxes to fund climate change action

African leaders are calling for new global taxes to fund climate change action

  • The Nairobi Declaration concludes the three-day African Climate Summit
  • He calls on big polluters to contribute more to poor countries
  • Africa receives about 12% of its financing needs of $300 billion annually
  • The leaders will present their proposals to the COP28 Summit in November

NAIROBI (Reuters) – African leaders on Wednesday proposed new global taxes and reforms to international financial institutions to help fund climate change action, in a declaration that will form the basis of their negotiating position at the COP28 summit in November.

The Nairobi Declaration was the culmination of a three-day Africa Climate Summit in Kenya, which was dominated by discussions on how to mobilize financing to adapt to increasing extreme weather, conserve natural resources and develop renewable energy.

Despite suffering some of the worst effects of climate change, Africa receives only about 12% of the roughly $300 billion annual climate financing it needs, according to the researchers.

And while organizers emphasized market-based solutions such as carbon credits in the run-up to the summit, the closing declaration weighed more heavily in terms of calls for big polluters and global financial institutions to allocate more resources to help poor countries and make it easier for them to borrow. reasonable prices.

She urged world leaders to “get behind the proposal for a global system of carbon taxes, including a carbon tax on fossil fuel trade, shipping and aviation, which could also be augmented by a global financial transaction tax.”

READ  Ukrainian soldiers flock to a makeshift hospital near Bakhmut

She said that implementing such measures at the global level would ensure widespread financing for climate-related investments and insulate the issue of tax increases from domestic geopolitical and political pressures.

About 20 countries have carbon taxes, according to the International Monetary Fund, but the idea of ​​a global carbon tax has never gained much traction.

On Tuesday, Kenyan President William Ruto cited proposals in the European Union for a financial transaction tax (FTT) as a possible model.

After the European Commission proposed a financial transaction tax in 2011, some conservation groups said the money should fund environmental priorities.

The Commission’s proposal never received the required unanimous approval from the European Council to become law, although some member states have enacted their own free trade agreements.

International financial system

African nations are set to take the proposals in the Nairobi Declaration to the United Nations climate conference later this month and the COP28 summit, which begins in the United Arab Emirates in late November.

Joab Boyer Okanda, a senior advisor at the charity Christian Aid, said the call for a global carbon tax was welcome, but “to make polluters really pay, bogus solutions such as carbon credits that allow polluters a free ride without relevant action need to be resolved.” meaning”. It has been sent to the trash.”

Some activists say credits, which allow polluters to offset emissions by financing green activities, are an excuse for big polluters to continue emitting carbon dioxide.

Governments, development banks, private investors and philanthropists pledged a total of $23 billion to green projects over the three days, Ruto said, including hundreds of millions to a major carbon markets initiative.

READ  Putin compares himself to Peter the Great in his quest to regain Russian territory | Russian President Vladimir Putin

But African leaders have acknowledged that this type of investment is only scratching the surface of the continent’s financial needs, and said more systemic changes are needed.

For example, African countries say they have to pay borrowing costs five to eight times higher than rich countries, which leads to frequent debt crises and prevents them from spending more to respond to climate change.

The declaration called on multilateral development banks to increase concessional lending to poor countries and to “better publicize” the International Monetary Fund’s Special Drawing Rights (SDR) mechanism.

Other proposals included measures to help debtor countries avoid default, such as instruments that could grant 10-year grace periods and extend the duration of sovereign debt.

Some analysts said the summit did not focus enough on how to help Africans adapt to extreme weather.

“Many communities bearing the brunt of increased floods and droughts, while also at risk of conflict, are disappointed that there has not been more focus on ensuring green investments reach them,” said Nazanin Moshiri, senior analyst at the International Crisis Foundation. intellectual group.

Additional reporting by Susannah Twadel in London; Editing by Allison Williams and Emilia Sithole-Matares

Our standards: Thomson Reuters Trust Principles.

Obtain licensing rightsopens a new tab