Published on 23 February 2019

SUSTAINABLE FINANCE

Global call to massively mobilize capital for the climate

Elected officials, economists, scientists, and academics may all propose different plans, but they all have the same goal: ensure that not a single euro or dollar finances global warming, particularly through the development of fossil fuels. These calls must move global decision makers from inaction to action.

Alexandria Ocasio Cortez Green New Deal SaulLoeb AFP
Alexandria Ocasio Cortez is a democrat congresswoman who support a Green New Deal
@Saul Loeb / AFP

Leaders cannot remain deaf to the multiplying calls demanding that capital be mobilized for the energy and ecological transition. These warnings come from economists, elected officials, scientists and ordinary citizens who want to see the emergence of a global Marshall Plan to save the climate, and consequently our economies and societies.

A European climate bank

At the European level, the finance-climate pact proposes capital mobilisation. During an exceptional event in Paris on 19 February, 600 personalities from 12 countries came to support this project led by climatologist Jean Jouzel and economist Pierre Larrouturou. They proposed a treaty to create a "European Bank for Climate and Biodiversity" (EBCB), which would be a subsidiary of the European Investment Bank (EIB) and would constitute its own specific fund.

Together, these tools would have a funding capacity of €300 billion per year. This is nothing compared to financing the European objectives, estimated at €1.115 trillion... every year. In a video (below), the promoters of the project recall that in 2008 leaders managed to find €2 trillion in financing, yet we are unable to spend so little money on the climate.

No to climaticide’ funding in France

At the French level, the "bill for transparency in the use of public savings on energy" aims to redirect money from French citizens to green projects. It will be presented on 20 February in front of the Finance Committee of the National Assembly. This text, drafted by congressmen from the socialist “insoumise” political party, seek to force banks to explain what they do with the resources collected under standard and sustainable development savings books. Hence the demand to formalise a public report on their activities.

In the law’s explanatory memorandum, it reads: "We believe, much like many citizens, that no euro spared by the French should contribute to financing ‘climaticide’ projects". This text has the support of 25 academic economists, according to an article published on France Info.

"To succeed in drastically reducing the carbon intensity of our economic systems, the question of financing is essential and requires us to stop funding fossil fuels," they write. However, the authors regret that "since COP21, for every €10 euros of financing granted by the banks to energy sectors, €7 go to fossil energy".

A "Carbon free" America

In the United States, the Green New Deal echoes European calls. It has been proposed by a rising star in the Democratic party and elected New York congresswoman, Alexandria Ocasio-Cortez. As with the climate finance pact, her project has received the support of many personalities such as journalist and activist Naomi Klein, former UN Secretary Ban Ki-moon, economist Paul Krugman and democratic senator Bernie Sanders.

This plan aims to radically challenge Donald Trump's climate-sceptical America. It calls for 100% clean energy in ten years, carbon neutrality by 2050 (as in France) and more particularly, the massive reorientation of public capital towards non-CO2 emitting energy and transportation methods.

The common thread between all these initiatives is that they call for radical changes to our economies. In this sense, they will feed the debates that will take place during the big elections to come, first the Europeans in May 2019, then the presidential election in the United States at the end of 2020.

Ludovic Dupin, @LudovicDupin


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