Climate Change Finance: Its significance in the context of Bangladesh
Climate change is one of the most pertinent issues around the globe and a matter of grave concern for the entire world community. Climate change refers to long-term shifts in temperatures and weather patterns. According to the United Nations, “warmer temperatures over the years are changing weather patterns and disturbing the usual balance of nature.” This may pose many risks to human beings and all other forms of life on earth. The earth is now 1.1 Celsius warmer than it was in the 1800s. Unfortunately, developed countries, for example, the USA, China, and India have failed to meet the Paris Agreement target to keep the global temperature from exceeding 1.5 Celsius above pre-industrial levels. We need to keep in mind that 2020 was one of the hottest years on record. Higher temperatures can increase heat-related illness and can make it more difficult to work and move around. Wildfires may start more easily and spread rapidly when the situations aggravate severely. According to UN News, “Climate change and increasingly extreme weather events, have caused a surge in natural disasters over the past 50 years which is disproportionately impacting poorer countries.”The impacts of climate of change on different sectors of society are deeply interrelated. Drought can harm food production and human health. Flooding can cause damage to ecosystems and infrastructure.
Now, many countries have started adopting many tools and techniques to combat climate change. Fighting against climate change is a herculean task for many countries, especially for climate-vulnerable countries. Climate finance is one of those essential tools that developed countries and least developed countries have started taking up. Climate Finance refers to local, national, or transnational drawn from public, private and alternative sources of financing that seek to support mitigation and adaptation that will address climate change issues. In a broader sense, climate finance generally means any type of financing that is used to tackle climate change. In this case, climate finance refers to the money that is provided by developed countries to developing economies to help them to fight this problem of climate change such as greenhouse gas emissions. And at the same time, climate finance facilitates them to develop and invest in economic-friendly technologies and resources such as wind and solar power. Typically, the money involved in climate finance comes from developed countries that use private and public players such as the central banks, big corporations, and enterprises to allocate funds. Developed countries for example USA, Germany, France, China, and India have started allocating a significant amount of money to National Budget or Federal Budget for climate change adaptation and mitigation. “In 2021, US president Joe Biden proposed more than $36 billion to combat climate change. The US government emphasizes large new investments focusing on clean energy, climate, and sustainability research and improved water infrastructure, among other things.” They believe that this climate funding might facilitate Biden’s commitment to slashing U.S carbon emissions in half by 2030 and put the country on a way to carbon neutrality by mid-century. It is widely recognized that the Least Developed Countries are the most vulnerable countries to climate change. In most cases, Least Developed Countries cannot cope with climate change vulnerabilities due to a lack of technical, financial, and institutional capacity to find out the best ways to build resilience. In 2001, United Nations Framework Conventions on Climate Change decided to establish Least Developed Countries Fund. The basic objective of LDCF is to assist LDCs in carrying out the preparation and implementation of national adaptation programs which are operated by the Global Environment Facility.
Bangladesh has embraced Climate Finance techniques and tools to mitigate risks related to climate change. The government of Bangladesh has stepped up its efforts to develop the capacity and resilience of the country to meet the challenges of climate change. The country adopted a 10-year programcalledBangladesh Climate Change Strategy and Action Plan(BCCSAP)in 2008 which was subsequently revised in 2009 to include more areas of action. The Action plan mainly focused on the needs of the poor and the disadvantaged communities. It is based on six pillars which include food security, social protection, and health, comprehensive disaster management, infrastructure; research and knowledge management; mitigation and low carbon development, and capacity building and institutional strengthening.
In recent times, the government of Bangladesh has taken up the agenda of introducing climate finance in its public financial management system. As part of this agenda, the government has been publishing a climate budget report every year which is placed before Parliament. The report in Fiscal Year 2021-22, reveals that 7.26% of the total budget of 25 ministries represents climate allocation.”BCCTF(Bangladesh Climate Change Trust Fund ) allocated $447 million (Tk38,000 million) from FY 2009-10 to FY 2019-20 according to a CPD study (2020). The Government of Bangladesh has also set a cumulative budget allocation for 25 ministries/divisions accounting for 56.69%, of which 7.52% is climate-relevant. Based on priority, Bangladesh is planning for the effective utilization and need-based allocation of the proposed climate budget of $2,850 million (Tk242,260 million) for FY 2020-21 – this contrasts with last year’s allocation of 7.81% according to a CPD study.”In terms of international support, at present times, several multilateral and bilateral sources of the fund have been operating in Bangladesh globally. Bangladesh has received accessibility to some essential bilateral channels of climate funding DFID, USAID, SIDA, and GIZ. Moreover, some key international funding sources for Bangladesh have been disbursing a large of amount money to combat the menace of climate change which are provided by the Green Climate Fund (GCF), and Climate Investment Funds (CIF), Global Environment Facility (GEF), among others. “Nevertheless, CF rather decreased between 2015 and 2016, as data from the Aid Management Information System, Economic Relations Divison have shown between 2010 and 2016. “
The UN Secretary-General Antonio Guterres has been pushing the nations to commit to more ambitious climate action with a 45% cut in carbon dioxide emission by 2030 and net carbon emissions by 2050. It is incumbent on the world to tackle climate change dexterously using climate finance strategies. Therefore, it is an important task for the government of Bangladesh to prioritize climate change issues and resolve them decisively and skillfully as our country is being recognized as a climate-vulnerable country. Now, the nations must work together and exert collective efforts to protect the communities since climate change has brought catastrophe and natural disasters in many countries. Lastly, optimism, hope, and determination can turn our vision into reality to make the world more beautiful, prosperous, and greener.
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