The G7 Development Ministers met in Berlin from 18-19th of May and outlined ambitious plans in the space of climate and disaster risk finance and insurance (CDRFI) in their final communique. The ministers recognized the urgent need to ensure the protection of people and countries vulnerable to climate change and disaster risks, while acknowledging that past efforts towards the InsuResilience Global Partnership (IGP), risk pools and other CDRFI mechanisms have already increased the financial protection in recent years. But nevertheless, there is still a long way to go – the protection gap for the most vulnerable countries is still at about 98% (Geneva Association, 2018).
The G7 showed commitment to strengthen the CDRFI architecture in a systematic, coherent and sustained manner. This includes a pledge to work with partners out the G7, including the private sector, towards a Global Shield against Climate Risks. Existing frameworks and mechanisms shall be strengthened, including those that reflect specific features of each region, and any effort on CDRFI shall be linked with those for the expansion of adaptive social protection. One part of the Global Shield must be a strong donor coordination to avoid duplication of work, for which the G7 affirmed to work with the IGP to build a strong coordination mechanism for CDRFI. A second important feature is identification and closure of protection gaps – here, the G7 called upon the InsuResilience Solutions Fund and the WB Global Risk Financing Facility, and demands their support (and therefore inclusion) of a wide range of partners. Finally, the G7 countries endorsed the SMART Premium and Capital Support Principles, committed to their further development and their translation into practise, while calling on others to do the same.
MCII welcomes these ambitious plans towards a Global Shield, better donor coordination and the endorsement of the SMART Principles – but now adequate financial commitments and a true spirit of cooperation and coordination, together with vulnerable countries, must follow suit if these plans are to materialize.
Read MCII and Germanwatch’s key asks towards the G7 in the field of CDRFI HERE
Read the full Communique HERE
Under the German G7 presidency, the following work priorities were discussed under the so-called “G7 Development Track”: Global food security, Infrastructure investments for sustainable development, Climate, energy and development partnerships for climate neutrality, Access to vaccines and robust health systems, Climate neutrality and social equity in the economic recovery.