Asian Development Bank President Takehiko Nakao has announced that ADB will double its annual climate financing to $6bn by 2020, up from the current $3bn, ADB said in a statement on Friday.
ADB’s spending on tackling climate change will rise to around 30% of its overall financing by the end of this decade.
ADB’s announcement comes against the backdrop of a promise by developed countries to mobilize $100 billion every year from 2020 to counter climate change in developing countries.
Out of the $6bn, $4bn will be dedicated to mitigation through scaling up support for renewable energy, energy efficiency, sustainable transport and building smart cities while $2bn for adaptation through more resilient infrastructure, climate-smart agriculture and better preparation for climate-related disasters.
ADB’s doubling of climate finance’s reflects its strategic priorities as well as the increase in ADB’s overall financing capacity by up to 50% due to a more efficient use of its balance sheet by combining the equities of its Ordinary Capital Resources and Asian Development Fund (concessional finance window) in 2017.
“World leaders gathering in New York this weekend will commit to achieving 17 historic Sustainable Development Goals (SDGs) by 2030 and ADB stands ready to be an important part of global efforts to finance these goals,” Nakao said.
“Nowhere is tackling climate change more critical than in Asia and the Pacific, where rising sea levels, melting glaciers and weather extremes like floods and droughts are damaging livelihoods and taking far too many lives.”
SDG 13 specifically calls for an urgent action to combat climate change and its impacts. Also, mitigating and adapting to a changing climate are key to most of the other goals including ending poverty, achieving food and water security, providing access to energy, and building sustainable cities.
Later this year, at the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP21) in Paris, the international community is expected to finalise a new global climate agreement and the way to finance it.
In addition to scaling up its own climate financing, ADB will continue to explore new and innovative cofinancing opportunities with public and private partners. For example, ADB will seek to mobilise concessional financing from the Green Climate Fund.