No country should have to choose between tackling poverty and fighting climate change, French President Emmanuel Macron told global leaders on Thursday at a summit aimed at reimagining the world’s financial system.
The summit on a new global financial agreement aims to find financial solutions to achieve the interconnected global goals of tackling poverty, curbing global warming emissions and protecting nature.
In his opening address, Macron told delegates that the world needed a “public finance shock” to deal with the challenges, adding that the current system was not well suited to the world’s challenges.
“Policymakers and countries should not have to choose between reducing poverty and protecting the planet,” Macron said.
Ugandan climate activist Vanessa Nakat took the podium after Macron and asked the audience to observe a minute’s silence for those affected by the devastation, including oil-rich Saudi Arabia’s Crown Prince Mohammed bin Salman.
She lashed out at the fossil fuel industry, saying they promised development for impoverished communities, but the energy went elsewhere and profits “fall into the pockets of those who are already extremely rich”.
“It looks like a lot of money, so please don’t tell us we have to accept toxic air, barren land and toxic water in order to grow,” she said.
The economy has been hit by successive crises in recent years, including Covid-19, the Russian invasion of Ukraine, soaring inflation, debt and spiraling costs from weather disasters exacerbated by global warming.
Leaders at the summit included Barbados Prime Minister Mia Motley, who has become a powerful advocate for reimagining the roles of the World Bank and the IMF in an era of climate crisis.
Kenyan President William Ruto’s office said he would “emphasize the urgent need to go beyond incremental measures that are ineffective in addressing the climate crisis and delivering investment returns in Africa”.
Other participants included UN Secretary-General Antonio Guterres, US Treasury Secretary Janet Yellen, IMF Managing Director Kristalina Georgieva and World Bank President Ajay Ban add.
France said the two-day summit would serve as a platform for ideas ahead of a series of major economic and climate meetings this year.
But observers are looking for tangible progress — including delivering on promises already made.
“We need some down payments from rich countries and their development finance institutions,” said Alex Scott of think-tank E3G.
One possible announcement is that a pledge made in 2009 to provide $100 billion a year in climate finance to poorer countries by 2020 will be met later.
A second pledge to reallocate $100bn in unused “special drawing rights” (SDRs) – the IMF’s liquidity-boosting tool – will also be in the spotlight.
Yellen said the U.S. will use the summit to push for creditor relief and restructuring of developing country debt.
“The international community must come together to support countries that are currently in crisis,” she told a news conference.
As the world’s leading creditor nation, China has come under scrutiny for its lack of participation in multilateral efforts to ease developing countries’ debt burdens.
The summit comes amid growing awareness of the scale of the financial challenges ahead.
Last year, a UN panel said developing and emerging economies, excluding China, would need to spend about $2.4 trillion a year on climate and development by 2030.
“Great Leap Forward”
Countries called on multilateral development banks to help unlock climate investments and substantially increase lending, while stressing that new debt arrangements should include a catastrophe clause like the one in Barbados, allowing a country to suspend repayments for two years after an extreme weather event.
Other ideas under discussion include taxes on fossil fuel profits and financial deals to raise climate finance.
The French president backs the idea of an international tax on shipping carbon emissions and hopes to see a breakthrough at a July meeting of the International Maritime Organization.
Observers are also eagerly awaiting details of the South American country’s plan to create a so-called debt-for-nature global structure.
After a meeting in Germany last week, Colombian President Gustavo Petro said the idea had been discussed with the United States, Germany and African countries.
According to Petro, this is “probably humanity’s first great leap forward in solving its biggest problem”.
Billie Eilish will perform at Global Citizen’s “Power Our Planet” concert later Thursday, bringing a star to a macroeconomic niche that has never been so visible attraction.