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US urges development banks to help climate fight

US Treasury Secretary Janet Yellen.
Image Credit: Reuters

Washington: US Treasury Secretary Janet Yellen on Thursday told the heads of the World Bank and other multilateral development banks to come up with concrete plans to mobilize significantly more capital to fight climate change and support emission reduction targets.

The Treasury Department said in a statement that Yellen, White House Climate Envoy John Kerry, and the heads of major development banks discussed ways to “maximize” private capital to finance the fight against climate change and reassess banks’ domestic incentives and practices.

Secretary Yellen called on MDBs to focus more on climate change adaptation, especially through private sector operations, and to support developing countries in implementing ambitious measures to reduce emissions and protect critical ecosystems, the Treasury said.

Yellen will reconvene the group “to discuss their concrete plans in October” in accordance with the guidelines for the annual meetings of the World Bank and the International Monetary Fund.

Potential initiatives discussed at the meeting included banks moving beyond traditional development finance to help countries develop green bond markets and create an “enabling environment” to attract more private climate investment.

In addition to the World Bank Group, the institutions participating in the meeting included the African Development Bank, the Asian Development Bank, the European Bank for Reconstruction and Development and the Inter-American Development Bank.

World Bank President David Malpass tweeted that during the meeting there was “a good discussion on climate change.” “A sense of urgency to tackle climate change is vital as we tackle the challenges of transition, access to electricity and mobilizing the private sector for mitigation / adaptation.” Yellen said at the G20 climate conference in Venice, Italy that she will ask organizations to “increase their climate ambitions” to support the 2015 Paris Agreement to cut carbon emissions.

Yellen, who asked Reuters in an interview last week if she would instruct the MDBs to stop funding fossil fuel projects, said: “I think our position is likely to be that where there are alternatives, we definitely are not. we will support coal – coal-fired facilities – and we give preference to environmentally friendly projects.

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