Washington DC, 21. April 2022: Greater inclusivity of vulnerable countries in global financial reform and decision making of the G7, G20 and IMF, and a call to urgently upscale climate finance, were among the key messages of the V20 Group of Finance Ministers dialogue held at the sidelines of the World Bank and IMF annual spring meetings. As highlighted in the V20 groups’ Communiqué, Ministers shared grave concern about the economic aftermath of the Covid-19 pandemic, the global energy price crisis due to conflict in Ukraine, and extreme weather events growing in frequency and intensity, causing financial distress, liquidity crisis and undermining vulnerable countries’ climate action. In response, the V20 calls on the G7 and G20 to establish a fit-for-climate-prosperity global financial system, building on the leadership of the IMF – especially in the context of climate resilient debt restructuring, enabling debt for climate swaps and allowing for a greater debt flexibility for climate action under the IMF Article IV debt surveillance activities.
The V20 ministers also highlighted important progress on making risk and resilience analytics available through the establishment of the “Global Risk Modelling Alliance ” (GRMA), a global public private partnership with the Insurance Development Forum supported by Germany. In order to reduce the financial protection gap, the V20 is continuing its cooperation with its G7 and G20 partners of InsuResilience Global Partnership in in the Sustainable Insurance Facility (SIF).The SIF aims to develop and strengthen the domestic insurance sector to avert, minimize and address losses and damages with a focus on micro, small and medium sized enterprises securing employment and livelihood at the heart if V20 economies. Building on cooperation with the InsuResilience Global Partnership, donor support and multilateral development banks and private sector engagement, the V20 Ministers are also calling for the creation of a coordinated and adequately-resourced Global Shield for financially protecting against climate-related losses and damages. The Global Shield is on the agenda for the G7 Summit end of June in Elmau, Germany.
Building on the outcomes of COP 26, V20 members stressed that doubling of adaptation finance must be realized, citing the V20 accelerated finance mechanism as one way to deliver on the COP 26 Climate Finance Delivery Plan on meeting the US Dollar 100 Billion Goal through 2025. En route to COP 27, the V20 group urges the international community to establish an international financing mechanism for climate change related losses and damages in solidarity with the most climate vulnerable countries and communities. To keep the 1.5°C goal alive, the V20 ministers are urging the largest emitters from the G7 and G20 to increase their NDC commitments and regard the current fossil fuel price surge as an opportunity to divert investments in renewable energy and storage. The V20 is also seeking technical cooperation with G7 and G20 countries, to support the green economy transition and unlock new climate resources as outlined in the V20 Climate prosperity Plans.
MCII is supporting the V20 and InsuResilience Global Partnership