Starting from where I left off in my last blog – we’re talking about climate change again!
But, this time, we’re shedding the spotlight on a subtopic of climate change that is perhaps not known or understood fully by the masses.
No, I haven’t meshed two completely different words together. It is a thing and you can look it up!
On second thoughts, don’t because as soon as you read the next paragraph, you will understand what it is.
‘Climate finance’ refers to the investments that support significant reductions in greenhouse gas emissions and financial measures that help adapt to the current and future impacts of a changing climate.
So it is right to assume that if the world wishes to become climate-neutral by 2050, then enormous amounts of investments (both from the public and private sectors) are required.
Climate finance is important to systemically combat climate change. After all, there needs to be a proper system in place for whole continents like Europe to invest substantially in climate change mitigation and adaptation.
And, as you can imagine, climate financing is never going to be about hundreds or thousands of Euros. The investment needs will be totalling hundreds of billions of Euros per year.
There’s another important term that you should be introduced to, at this point.
Sustainable climate finance. It aims to channel private investment into the transition to a climate-neutral, climate-resilient, resource-efficient and fair economy.
Private investments, when combined with public money from Europe and other continents may make a huge impact on the climate.
Next, we move to the topic of the European Economic Area ( EEA ) which includes EU countries, Iceland, Liechtenstein and Norway.
It is continually assessing the connections between climate action, including current and future measures to reduce emissions and adapt to the impacts of climate change, and the financial and fiscal systems.
This organization has been contributing extensively to the initiative of sustainable climate finance for five years and counting.
It has also helped develop recommendations for identifying economic activities that can make a substantial contribution to climate change mitigation or adaptation. The recommendations also address how to ensure that climate investments avoid significant harm to other environmental objectives such as sustainable use and protection of water and marine resources, transition to a circular economy, pollution prevention control, and protection and restoration of biodiversity and ecosystems.
My parting thoughts on the EEA are that it is also a part of the EU Platform on sustainable finance, set up as a permanent expert group under the EU Taxonomy Regulation.
Signing off by saying that climate finance needs more attention, both as a topic and act, to shape a carbon-neutral and eco-friendly future.