Inter-American Development Bank
facebook
twitter
youtube
linkedin
instagram
Abierto al públicoBeyond BordersCaribbean Development TrendsCiudades SosteniblesEnergía para el FuturoEnfoque EducaciónFactor TrabajoGente SaludableGestión fiscalGobernarteIdeas MatterIdeas que CuentanIdeaçãoImpactoIndustrias CreativasLa Maleta AbiertaMoviliblogMás Allá de las FronterasNegocios SosteniblesPrimeros PasosPuntos sobre la iSeguridad CiudadanaSostenibilidadVolvamos a la fuente¿Y si hablamos de igualdad?Home
Citizen Security and Justice Creative Industries Development Effectiveness Early Childhood Development Education Energy Envirnment. Climate Change and Safeguards Fiscal policy and management Gender and Diversity Health Labor and pensions Open Knowledge Public management Science, Technology and Innovation  Trade and Regional Integration Urban Development and Housing Water and Sanitation
  • Skip to main content
  • Skip to secondary menu
  • Skip to primary sidebar
  • Skip to footer

Sostenibilidad

Just another web-blogs Sites site

  • HOME
  • CATEGORIES
    • Agriculture and Food Security
    • Climate change
    • Ecosystems and Biodiversity
    • Environmental and Social Safeguards
    • Infrastructure and Sustainable Landscapes
    • Institutionality
    • Responsible Production and Consumption
  • Authors
  • English

COVID-19 is our wake-up call to build a sustainable and inclusive future

November 4, 2020 por Graham Watkins Leave a Comment


Latin America and Caribbean countries are facing a pandemic with myriad social and economic consequences. At the same time, we also have climate change enhanced fires raging in Brazil’s Pantanal and hurricanes pounding the Caribbean. This complex situation shows that governments, the private sector, civil society, and multilateral development banks (MDBs) need to work together to support a sustainable recovery.

The consequences of COVID-19 in the region are tragic. It is the worst hit region, alongside Asia, with over 310,000 deaths. We estimate that we may lose up to 17 million formal and 23 million informal jobs this year and 2.7 million companies will go out of business.

Our path out of the pandemic should make sure we create a new normal and shift from business as usual to sustainable economic development. Development banks have a vital role to play to support this shift by ensuring we do projects the right way, select the right projects, and help fix governance, financial, and institutional systems.

First, we need to do projects the right way. The traditional focus on climate change has been to measure and check emissions and make sure resilience to climate risks is baked in. While this approach matters, we need to go further.

That’s why the IDB has just released a new Environmental and Social Policy Framework. This policy moves beyond measuring and reducing emissions to trying to avoid them. It also incorporates an exclusion list that limits the IDB’s financing of fossil fuels to reflect country commitments to the Paris Agreement. The new policy also requires assessing climate change and disaster risks and will apply a method for risk management that makes sure projects are resilient.

Second, MDBs can also help make sure we manage the climate crisis by doing the right projects. We decide which projects to support in response to demand from our clients. The most recent update to the IDB Group Institutional Strategy emphasizes the cross-cutting challenge of climate change and environmental sustainability. Our Corporate Results Framework (CRF) also reflects commitments to climate finance and sustainable land use. It refers to the need for the borrower to check and manage climate risk in projects.

MDBs can support countries in ensuring long-term planning for decarbonization and adaptation. Planning includes ensuring stakeholder engagement and working with Ministries of Finance, Ministries of Planning, and Sector Ministries in prioritizing and executing projects.

Twenty-one regional countries, including Chile, Costa Rica, and Jamaica, have announced their intention to achieve net-zero emissions by 2050 and enhance the ambition of their Nationally Determined Contributions (NDCs). MDBs can support countries with climate action by financing projects from these more ambitious NDCs.

Projects range from climate resilient and low-carbon infrastructure, through enhancing social resilience, and improving health systems, to promoting education for a just transition. With that in mind, last August, the IDB approved a US$200 million loan to The Bahamas to support small businesses, manage natural resources, and promote the Blue Economy.

Third, MDBs have a key role in helping to fix institutional contexts. A fundamental challenge to climate action is that organizations beyond those responsible for climate plans must own and execute those plans. Our work in the region shows how long-term strategies can support a just transition to net-zero emissions. This can help countries avoid becoming locked into expensive carbon-intensive pathways. With renewable energy now cheaper than fossil fuels in many countries, US$ 90 billion worth of assets are at risk of becoming stranded in the region’s power sector.

Additional fundamental challenges include the regulatory and governance barriers that increase costs and decrease effectiveness of climate solutions. Improving regulations can remove price barriers and help drive transformational change. Changing taxes and subsidies can increase fiscal revenue to help support governments through recovery. IDB supported improvements to fiscal policy and regulations can help create institutional arrangements for sustainable finance.

This means delivering finance that supports Environmental, Social and Governance (ESG) investments and ensures that projects consider and manage climate risks. This is important in fiscally constrained governments who urgently need private finance investment to recover. A key lesson learned from the last fiscal crisis is that we must change financial and institutional systems to make sure that recovery is sustainable in the long-term.

The IDB and other MDBs can support low-carbon and climate resilient development that is consistent with the Paris Agreement as a response to COVID-19. This includes ensuring MDB investments are low-carbon and climate resilient and support country plans for decarbonization and adaption.

MDBs must play their role in ensuring a long-term impact by helping countries introduce sustainability into institutions. A final role of development banks is supplying the knowledge to carry out changes for a more sustainable world and promote myriad co-benefits including reducing inequality and pollution.

There is strong public support for a sustainable recovery. Scores of countries and cities across the region and Europe are very interested in this agenda. A sustainable recovery can be the bridge between getting countries onto a path towards sustainable and inclusive development while advancing global climate and biodiversity commitments. Latin America, the Caribbean and Europe can be the engineers to construct that bridge.

This article was originally published by the EU-LAC Foundation.

Photo: Graham Watkins

Further reading

Creating 15 million new jobs for a sustainable recovery and a net-zero emissions future

What does a sustainable recovery look like after COVID-19?

Can nature support a green and inclusive economic recovery?

Long-term decarbonization strategies can guide Latin America’s sustainable recovery

Follow us on Twitter: @BIDCambioClima


Filed Under: Climate change Tagged With: sustainable recovery

Graham Watkins

Graham Watkins es Jefe de la División de Cambio Climático y Sostenibilidad del Banco Interamericano de Desarrollo y lidera los esfuerzos del Banco para apoyar las políticas y planificación climática en los gobiernos de América Latina y el Caribe (ALC), aumentar la disponibilidad de financiamiento para impulsar la transformación climática, integrar el clima en las operaciones bancarias y promover conocimiento sobre infraestructura sostenible, riesgo climático y descarbonización. Graham tiene treinta años de experiencia en ALC liderando iniciativas de biodiversidad, infraestructura sostenible y cambio climático en América Latina y el Caribe y ha publicado más de 60 artículos, incluyendo dos libros sobre Galápagos y Rupununi en Guyana. Anteriormente fue Director Ejecutivo de la Fundación Charles Darwin en Galápagos y Director General del Centro Iwokrama en Guyana. Graham tiene un doctorado de la Universidad de Pensilvania y una maestría de la Universidad de Oxford.

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Primary Sidebar

Follow Us

Subscribe

SEARCH

Sustainability

This blog is a space to reflect about the challenges, opportunities and the progress made by Latin American and Caribbean countries on the path towards the region’s sustainable development.

SIMILAR POSTS

  • Three ways NDC Invest can help countries of Latin America and the Caribbean deliver ambitious climate and development agendas
  • It’s time for finance ministries to take climate action to the next level
  • More than 230 Million Reasons to Invest in Sustainable Infrastructure
  • A key year for climate action
  • Getting to net-zero emissions is possible, necessary and can bring multiple economic benefits

Footer

Banco Interamericano de Desarrollo
facebook
twitter
youtube
youtube
youtube

Blog posts written by Bank employees:

Copyright © Inter-American Development Bank ("IDB"). This work is licensed under a Creative Commons IGO 3.0 Attribution-NonCommercial-NoDerivatives. (CC-IGO 3.0 BY-NC-ND) license and may be reproduced with attribution to the IDB and for any non-commercial purpose. No derivative work is allowed. Any dispute related to the use of the works of the IDB that cannot be settled amicably shall be submitted to arbitration pursuant to the UNCITRAL rules. The use of the IDB's name for any purpose other than for attribution, and the use of IDB's logo shall be subject to a separate written license agreement between the IDB and the user and is not authorized as part of this CC- IGO license. Note that link provided above includes additional terms and conditions of the license.


For blogs written by external parties:

For questions concerning copyright for authors that are not IADB employees please complete the contact form for this blog.

The opinions expressed in this blog are those of the authors and do not necessarily reflect the views of the IDB, its Board of Directors, or the countries they represent.

Attribution: in addition to giving attribution to the respective author and copyright owner, as appropriate, we would appreciate if you could include a link that remits back the IDB Blogs website.



Privacy Policy

Derechos de autor © 2023 · Magazine Pro en Genesis Framework · WordPress · Log in

Banco Interamericano de Desarrollo

Aviso Legal

Las opiniones expresadas en estos blogs son las de los autores y no necesariamente reflejan las opiniones del Banco Interamericano de Desarrollo, sus directivas, la Asamblea de Gobernadores o sus países miembros.

facebook
twitter
youtube
This site uses cookies to optimize functionality and give you the best possible experience. If you continue to navigate this website beyond this page, cookies will be placed on your browser.
To learn more about cookies, click here
x
Manage consent

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary
Always Enabled

Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.

Non-necessary

Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.

SAVE & ACCEPT