The FINANCIAL — Fiscal Policy Network are calling on governments to back their green recovery rhetoric with financial commitments. The Global Recovery Observatory’s updated analysis finds only 21% of recovery spending by advanced economies – and a mere 3% of total COVID-related spending – is classified as green.
While vulnerable nations are unable to raise even $100 billion in climate finance, advanced economies have spent $14.4 trillion on an unsustainable COVID-19 recovery, University of Oxford notes.
Brian O’Callaghan, Lead Researcher and Project Manager of the Oxford University Economic Recovery Project, says, ‘At COP26, some rich countries will try to escape their financial obligations – like a gourmet who has gorged themselves and then decides to ‘dine and dash’. It is outrageous.’
The report states, multi-trillion-dollar COVID-19 stimulus packages represent a once in a generation opportunity to both bring economic growth and accelerate climate action, but governments are missing their chance to align funding with climate commitments.
Today’s report, Global COVID-19 recovery investment is not aligned with COP rhetoric, says governments should commit to green recovery spending, make a lasting shift to environmentally-sustainable budget practices and increase green aid to vulnerable nations.
Ahead of COP, the report reinforces the call made at the launch of the Global Recovery Observatory with three key recommendations.
Green the recovery to get our economies and climate actions back on track.
Green stimulus can simultaneously meet economic, social, and environmental goals.
Recovery spending on traditional infrastructure without green incentives reinforces the unsustainable status quo.
Reinforce the green recovery with a lasting shift to sustainable budgeting.
Sustainability must be a key consideration in all public spending going forward.
Spending should be assessed holistically – for its economic, developmental, social, and environmental impacts – even after the COVID-19 economic recovery.
Increase the climate-focussed financial support provided to vulnerable nations.
Green financing and aid can close widening international development gaps and set vulnerable nations on a path of long-term, cleaner growth.
Brian O’Callaghan concludes, ‘Governments can prove their net-zero commitments aren’t a scam by allocating recovery dollars to green initiatives, and in the process significantly growing their economies.
‘Vulnerable nations are being left behind. For every $100 per person that advanced economies have spent on COVID, Least Developed Countries have spent less than 50 cents.’
The Global Recovery Observatory is an initiative led by the Oxford University Economic Recovery Project (OUERP), and supported by UNEP, the International Monetary Fund and GIZ through the Green Fiscal Policy Network (GFPN), as well as UN PAGE. Data visualisation support is provided by the UNDP Data Futures Platform, according to University of Oxford notes.
The Global Recovery Observatory brings transparency to global government spending during the COVID-19 crisis. The intent of the Observatory is to showcase exemplary policy solutions, identify lost opportunities. and direct governments towards more impactful and sustainable investment.
The Oxford University Economic Recovery Project is housed in the Smith School of Enterprise and the Environment. The project advises global policy, business, and third sector leaders on the topic of sustainable public finance in response to economic crises and particularly the COVID-19 pandemic. It is supported by the Green Fiscal Policy Network, the United Nations Environment Program, the Children’s Investment Fund Foundation, and the ClimateWorks Foundation. Brian O’Callaghan is supported by the Rhodes Trust.