This event was introduced by Moderator Richard Samans, Executive Director, GGGI, who said the session would explore how to help countries transition to sustainable economies.
Lars Løkke Rasmussen, Chair, GGGI Council, and Former Prime Minister, Denmark, highlighted that GGGI aims to catalyze the dissemination of green growth. He said action on the part of developing countries is required to address climate change, with the support of developed countries, noting the establishment of the Green Climate Fund (GCF) could contribute to these efforts.
Lord Nicholas Stern, London School of Economics (LSE), UK, said the two defining challenges of this century are addressing climate change and overcoming global poverty, emphasizing “if we fail at one, we will fail at the other.” He compared the investment required, which is in the trillions, with the US$100 billion that will be available in the GCF, concluding that the GCF is an important, but insufficient, component. He emphasized that leveraging private investment, through the “power of example” and partnerships, will be the primary source of funding.
Agus Sari, Chair, Funding Instrument Working Group, REDD+ Task Force, Indonesia, highlighted that the process of valuing forests is being promoted through REDD+ programmes. He stressed that de-risking investment through good-governance policies and guarantees of legal certainty, as well as strong carbon market demand, will promote investment.
Ouk Navann, General Ministry of Environment, Cambodia, said Cambodia plans to formulate a national action plan and green growth law, but noted the need for financial support to implement these mechanisms. He emphasized the need to mobilize funds, urging that public funding form the primary contribution to the long-term finance regime.
Karsten Sach, Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU), Germany, noted the need to: build transformative capacity; move beyond government silos; engage the private sector; and favor those taking transformative risks such as through renewable energy feed-in tariffs. He called for stable, predictable and increased funding from both public and private sources, highlighting the need for a robust private sector structure under the GCF.
Mary Barton-Dock, World Bank, noted the requirement of trillions of dollars for a global transition to renewable energy, saying that mobilizing private funds is essential to achieve this. She emphasized the GCF has to respond to private sector needs, including the requirement for returns on investment equal to investment risk plus a profit margin. She said the GCF should be in the position to reduce investment risk, possibly through investment guarantees and first-loss insurance.
During discussions, Stern said the role of GGGI should be to find and support “true innovation” to encourage private sector investment. He called fuel subsidies an “absolutely disgraceful use of public funding” saying they benefit those who are better off and hurt emissions reductions efforts. Barton-Dock said subsidies have to be removed in a way that ensures a safety net for those affected. Sari said subsidies are a political issue in Indonesia, and called for de-politicizing this issue.
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