G-20 Poised to Signal Retreat From Climate-Change Funding PledgeBy
Draft statement encourages private funding for climate change
Previous communique emphasized strong government support
Finance ministers for the U.S., China, Germany and other members of the Group of 20 economies may scale back a robust pledge for their governments to combat climate change, ceding efforts to the private sector.
Citing “scarce public resources,” the ministers said they would encourage multilateral development banks to raise private funds to accomplish goals set under the 2015 Paris climate accord, according to a preliminary statement drafted for a meeting that will be held in Germany next week.
The statement, obtained by Bloomberg News, is a significant departure from a communique issued in July, when finance ministers urged governments to quickly implement the Paris Agreement, including a call for wealthy nations to make good on commitments to mobilize $100 billion annually to cut greenhouse gases around the globe.
“It basically says governments are irrelevant. It’s complete faith in the magic of the marketplace,” John Kirton, director of the University of Toronto’s G-20 Research Group, said in an interview. “That is very different from the existing commitments they have repeatedly made.”
The shift in tone comes as U.S. President Donald Trump’s Treasury Secretary, Steven Mnuchin, prepares for his first G-20 meeting, scheduled for March 17 to 18 in the spa town of Baden-Baden. While European nations including Germany have been at the forefront of combating global warming, Trump has called climate change a hoax.
The Republican president vowed during his campaign to “cancel” the Paris agreement but has said little about the deal since taking office. His cabinet members, meanwhile, have sent mixed signals. U.S. Secretary of State Rex Tillerson said the U.S. should keep a seat at the table for international climate talks. Scott Pruitt, the head of the Environmental Protection Agency, on Thursday expressed doubt that humans were to blame for global warming and called the Paris agreement a “bad deal” for the U.S.
Several leaders of G-20 nations have expressed strong support for combating climate change and upholding the Paris accord since Trump’s election, including China and the U.K. The annual summit of G-20 heads of state is scheduled for July in Hamburg. It’s unclear what countries pushed for the new language in the finance ministers’ draft statement, which is likely to undergo revisions before being formally adopted.
The most notable element of the draft is what’s missing. The statement issued after the G-20 finance ministers and central bank governors meeting in July dedicated 163 words to the Paris Agreement, pushing nations to bring the deal into force, meet emissions targets and fulfill financial pledges. This current draft dedicates just 47 words to the agreement, focusing exclusively on development banks raising private funds, without mentioning government financial support.
Germany, as the meeting’s host, leads the process of writing the statement, which will eventually be adopted via consensus by all 19 nations plus the European Union. The German finance ministry declined to comment on the draft.
“The most charitable thing to say is they’re waiting to see where Donald Trump actually lands by the time they get in Hamburg and thus, doing nothing to annoy the incoming American Treasury Secretary,” Kirton said.
German Chancellor Angela Merkel, who holds the rotating presidency of the G-20, has signaled that she would use the forum to push Trump on climate issues. The two leaders are scheduled to meet in Washington March 14.
The finance ministers’ meeting is not the only opportunity for G-20 nations to push the Trump administration on global warming. Environment and energy ministers have been invited to a forum to discuss climate issues in preparation for the G-20 summit in Hamburg.
The finance ministers’ draft statement didn’t fully abandon government-backed environmental efforts. It established a goal for G-20 nations to phase out fossil fuel subsidies that encourage wasteful consumption by 2025. And it welcomed a push for public companies to disclose climate-related risks to shareholders.
Yet much of the group’s support for climate change efforts wound up on the cutting room floor.
“The takeaway is it clearly puts less emphasis on climate finance as a priority than last year’s did,” Alden Meyer, director of policy at the Union of Concerned Scientists, said in an interview. “It doesn’t talk about government action. That is a significant step back from what countries agreed to in Paris.”
— With assistance by Brian Parkin, and Rainer Buergin
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.