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The International Monetary Fund (IMF) says the public and private sectors need to unite in their investment towards tackling climate change. 

In a statement on Tuesday, Maria Candia Romano, the IMF press officer, said the body made this statement during a roundtable discussion co-chaired by Kristalina Georgieva, IMF managing director, Sultan Al Jaber, COP28 president-designate, and Mark Carney, UN special envoy for climate action and finance. 

The statement said that capital is the most important enabler of climate action, adding that there is a need for more private capital mobilization to broaden investor base, especially in developing economies.

“Climate change is one of the most critical macroeconomic and financial policy challenges that IMF members face in coming decades,” the statement reads. 

“Capital is among the most important enablers of climate action, but not enough is getting to the people and places that need it most.

“As massive global investments to reduce emissions and boost resilience are required — we need a major shift to harness public and, especially, private financing.

“That includes substantially more concessional finance that can lower risk and drive private sector finance more efficiently to emerging and developing countries. It also requires that both the public and private sectors finance all components of the energy transition, including both the scaling of clean energy and the managed phaseout of fossil fuels on an accelerated time frame.

“To achieve this objective, all countries need robust climate policies that accelerate the green transition and stronger mechanisms to promote cooperation and risk-sharing among stakeholders. 

“For example, improved policy, regulatory, technological and information frameworks and financial toolkits could support private capital mobilization, and broaden the investor base, especially in emerging and developing economies.”

Georgieva was quoted as saying that the financing approach for climate challenges must be made to redirect monies to vulnerable communities.  

“The impacts of global warming are already destroying lives and livelihoods, so we need a step change in our financing approach to redirect trillions of dollars towards meeting the climate challenge. To get there, stronger cooperation and partnerships across the public and private sector are vital – there is no time to waste,” she said. 

Carney said: “To ensure that the impact of the net-zero revolution underway in private finance benefits all countries, we need a more efficient and effective multilateral financial architecture. I salute the leadership of Kristalina Georgieva, Managing Director of the IMF, and Dr. Sultan Al Jaber, President-Designate of COP28, on this imperative, and look forward to partnering with them and other stakeholders to deliver progress this year.”

On his part, Al Jaber said the world needs to triple the money available for clean tech investment, adaptation finance, and a just energy transition by 2030 in emerging and developing countries.

He said that as the United Arab Emirates (UAE) prepares to host the UN climate conference (COP28), he would ensure to apply an action-oriented approach to enable the transformational progress the world needs. 

“Capital and finance are among the most important enablers of climate action and sustainable economic development, but not enough is getting to the people and places that need it most,” he said.

“For vulnerable communities, across the global south, climate finance is nowhere near available, affordable, or accessible enough.

“Only 20 percent of clean tech investment is going to developing countries that make up over 70 percent of the global population, and the least developed countries receive less than 2 cents on every dollar spent.

“Behind every number, there are individual lives, people and communities who should have the right to fulfill their potential and contribute to sustainable global prosperity.”