As government leaders started leaving Glasgow, the financiers stepped to the fore at COP26 on Wednesday.
While climate and environmental justice groups, groundwork, Earthlife Africa and the Centre for Environmental Rights, welcomed the announcement of a $8.5billion Just Energy Transition partnership with South Africa, they immediately started asking questions about transparency on the scope and conditions of the partnership, and accountability by lenders, beneficiaries and the South African government.
GroundWorks Director Bobby Peek said: “While this partnership is a step forward, it is a first step – South Africa’s need is much greater than the $8.5 billion proposed. To achieve a Just Transition to a zero carbon economy, South Africa needs climate finance that is transformational. For Mpumalanga alone, at least $1bn is needed only for worker support and other direct Just Transition interventions.”
Questions like ‘how much of this funding is in fact new funding’ echoed comments being made on social media around governments using net zero plans to paint themselves as climate champions and a new net zero alliance aimed at banking institutions.
More than 450 financial institutions in 45 countries, some of the world’s biggest banks and pensions funds, committed to limiting greenhouse gas emission by signing up to the Glasgow Financial Alliance for Net Zero. The promise is that by 2050 all of the assets they manage can be counted towards a net-zero emissions campaign.
But, as environmental groups were quick to point out, the pledge does not preclude the continued funding of fossil fuels for the foreseeable future.
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Also, hard at work at COP26 is the US government’s Millenium Challenge Corporation. The MCC and the Government of The Gambia completed negotiations for a $25 million Threshold Programme. The Threshold Programme will help The Gambia address some of the biggest constraints to economic growth – the unreliable and inadequate supply of electricity. The MCC is also negotiating a nearly $20million Threshold Programme with the government of the Solomon Islands.