The FINANCIAL — We are living in a world that is very different from the one we grew up in. The world today seems buffeted by crises on all sides. Some are immediate, like the unprecedented global crisis caused by the COVID-19 pandemic that is taking human lives and livelihoods. Others are longer term, but more critical for us and our children’s well-being according to World Bank.
Climate change is a global crisis that threatens our planet, our societies and our economies, and it also requires much-needed effective measures. And Ukraine is quite vulnerable to the impacts of climate change. It is the air quality, but also the broader effects of droughts, high temperatures, heat waves and floods. These sorts of extreme climate events are now more likely and severe in Ukraine than ever before.
At the World Bank, we really believe that climate change presents enormous challenges, but also opportunities for development that countries and societies need to grasp. We strongly believe that climate and development have to be tackled in an integrated way. This particular initiative, the Partnership for Market Readiness, supports countries with the design and deployment of climate change mitigation policies and carbon pricing instruments to scale up Greenhouse Gas (GHG) mitigation. It brings together more than 30 countries, including Ukraine, international organizations and experts to enhance collaboration and innovation.
As World Bank notes, in Ukraine, putting a price on carbon offers a really cost-effective solution to GHG emissions reduction targets and allows to shift towards a greener economy. Carbon pricing incentivizes the adoption of low carbon technologies. Putting a price on pollution incentivizes businesses to exploit all available opportunities to reduce emissions from their operations in the most cost-effective way.
With the presence and expansion of the European Green Deal, and the impending carbon border adjustment tax, this becomes a critical factor for Ukraine’s development, exports and growth. On these initiatives, World Bank teams started working with the authorities as far back as 2016, before the European Green Deal was even considered perhaps. These teams have been supporting the development and implementation of a robust system for monitoring, reporting and verification (MRV) of the GHG emissions in energy and industry.
A strong MRV system is a necessary building block for any effective climate mitigation policy instrument, including potentially an emissions trading system. With this initiative we provided technical assistance and development of the MRV laws and regulations; piloted some MRV projects in Ukraine; and supported training and capacity building in the public and private sectors.
But this can’t have been done by the teams alone. I really want to recognize very important steps that have been taken at high levels, by the Government of Ukraine and the parliament, the Verkhovna Rada, in the climate change policy arena of the last few years. For example, in December 2019, the MRV law was adopted by the Ukrainian Parliament and signed by the President, together with the related regulations that the Cabinet of Ministers passed in September 2020; together this has laid the ground for the MRV system launched by the Ministry of Ecology and Natural Resources.
Stepping back, this is really important for the work that we have to do for much of the rest of the year. Countries are working on updating their Nationally Determined Contributions (NDCs) for the Conference of the Parties (COP26) to the UN Framework Convention on Climate Change (UNFCCC) that will take place from 1-12 November 2021, in Glasgow, UK. The NDCs spell out what the countries plan to do to reduce emissions and adapt to climate change.
The World Bank is working across the world to help countries transition to low-carbon and resilient economies. We are absolutely committed to helping our partner countries and our clients to achieve the pledges that they made in Paris in 2015. The World Bank fully supports Ukraine in your climate friendly aspirations and targets, including the development of the MRV system and the emissions trading system, and plans on reducing carbon emissions to ensure clean air that we and our children will breath.
As World Bank notes, we are committed to continuing to provide technical assistance and capacity building to the Ministry of Ecology and Natural Resources and to the broader economy and society of Ukraine. On behalf of the World Bank, let me thank the Government of Ukraine and the Parliament of Ukraine for championing the PMR project. We hope that the fruitful collaboration will continue, in particular with the next stage program, the new program called Partnership for Market Implementation (PMI), that focuses on implementation of carbon pricing.