Workshop – Financing the Transition: Financial structures for transformative climate action in developing countries

The conference is organised jointly by the Brevan Howard Centre for Financial Analysis at Imperial College Business School and the World Bank Group. It will be held in London at The Berkeley Hotel, Knightsbridge as a full day event on the 16th June and half day event on the 17th June.

While climate finance levels are increasing, including from private investors, international public funds and carbon markets, the structures to combine these sources and deliver investments at scale for developing countries to address climate change have yet to be established.

Amidst much progress on climate change, there is still substantial uncertainty on how different sources of funding can be structured to pay for needed climate action. This is especially relevant for low- and middle-income countries (LMICs) which already face many development challenges, investment shortfalls, and the ongoing impacts of COVID-19.

Developed countries’ plan to belatedly mobilize $100 billion of annual climate finance for LMICs would still fall well short of the trillions of dollars of yearly investments needed. At the same time, commercial investors representing more than $130 trillion of assets under management have stated their commitment to net zero and expectations for carbon offset markets grow.

The impacts from the Russian invasion of Ukraine further complicate the issue with LMIC vulnerabilities exacerbated due to rising commodity prices and a renewed focus on energy security.

Novel financial instruments and structures can use available international public money to leverage the much larger sums of private finance needed for LMICs climate goals. Such Private Capital Mobilization (PCM) has great potential but challenges remain including the financial sector’s need to balance climate ambition with market returns, continuing uncertainty of carbon markets, institutional inertia, lack of capacity and knowledge, and competing government priorities.

At the same time, all climate action must involve a just transition that protects the vulnerable and segments of society negatively impacted by the move to decarbonization.

As the world moves from the achievements of COP26 in Scotland to the promise of COP27 in Egypt, greater clarity is needed on the financing structures to coordinate available climate resources in a timely and fair manner and the roles of key actors including development finance institutions, commercial investors, and both developed and developing country governments

The World Bank Group and Imperial College London’s Brevan Howard Centre for Financial Analysis are jointly holding a workshop on financing structures for transformative climate action in developing countries and emerging economies. This follows a similar workshop in October 2019 on Green Financial Reform in Developing Countries.

This closed-door, technical event will feature high-level, technically advanced participants from the financial sector, academia, international institutions, civil society and both developed and developing country governments.

To focus discussion and deliver practical recommendations, the event will examine both specific instruments and approaches, as well as financing options in two key sectors:

Instruments and Approaches

• De-risking project-based investments
• Greening Financial Sectors
• Tapping Carbon Markets

Sectors

• Transition from High-Carbon Power Generation
• Decarbonized Transport

For each instrument and sector, discussion will focus on:

1. What is working and how can that be scaled?
2. What is not working and how can it be fixed?

The common lessons from analyses of these instruments and sectors will then be used to deliver fresh perspectives on the roles that different stakeholders can play, including: changes needed in operating and governance modalities; specific, clearly defined responsibilities; and ways to effectively interact within a revised climate finance architecture.

To access the programme please click on this link

Any views expressed by our speakers are entirely their own and do not necessarily reflect those of the Centre, Imperial College Business School or any of their Sponsors