Germanwatch-Blog

Two years after the 2015 Paris Agreement, the world’s multilateral development banks (MDBs) committed to align their financial flows with the landmark climate pact’s goals. Now, four years later, it’s clear that as a group, the MDBs are still a long way away from realizing their commitment throughout their portfolios. While MDBs have focused on aligning direct investments with Paris goals, this effort is not sufficiently ambitious, nor is it complete. They have paid less attention to whether their indirect investments support climate goals. And policy-based loans — a favored instrument during times of crisis — also remain a blind spot.

How do European livestock farmers know whether forests have been cleared for the cultivation of soy in their feed? So far, feed manufacturers have pretended to be unable to take responsibility for their supply chains. Tracing back the origin of the soy through many intermediaries along the global supply chain was too difficult for them. In the future, however, an EU law could require companies to take responsibility for their global supply chains.

The climate crisis is hitting us right now and threatens to get much worse. Germany and the EU bear a special responsibility: What we do or don't do in Europe, our food and our trade system, have an impact on other parts of the world. This can be seen, for example, by looking at the destruction of forests in the Mercosur economic area – in Argentina, Brazil, Uruguay and Paraguay.

Interview with Giulia Dias (18), an activist with Fridays for Future (FFF) Amazônia. She studies law, lives in the city of Belém in northern Brazil and does research on the rights of indigenous communities in her country at the Emílio Goeldi Museum.

While the regions Greece, Kosovo and Serbia face common challenges like high unemployment, depopulation and brain drain – trends like decarbonisation and energy transition are supplementary hindrances. This Blog provides an assessment of the internal and external environment for each region and how the "Green Rural Deal-Project" will bridge them towards a low-to-zero-carbon development and serve as a "proof of concept" that even for the most deprived regions, the transition provides multiple benefits.

In the upcoming week, the 13th meeting of the WIM ExCom will take place (April 27-30 2021). One very important issue to discuss will be – among other issues – the work of the Expert Groups as they play a major role in carrying out the activities of the ExComs workplan. Especially the work on Action and Support, Slow-onset Events and Non-economic Losses will be discussed and concrete steps for developing the respective workplans with concrete activities will have to be decided upon. The meeting will take place in a virtual format and even over one year in the COVID-19-pandemic this setting still poses some substantive challenges to the discussions and inclusiveness as well the involvement of observers.

The COVID-19 pandemic has advanced into the biggest global health crisis in recent human history and exacerbated existing challenges for developing countries. Nonetheless, poorer nations are still showing remarkable commitment to dealing with the climate crisis. As the pandemic continues, developing countries are increasingly reaching their limits. Additional international climate finance post-2020 is needed to respond to the climate, health, and debt crises, after developed countries already failed to deliver on the USD 100 billion. At the upcoming US Climate Leaders Summit and the Petersberg Climate Dialogue, developed countries need to step up their game on international climate finance. The blog presents clear asks for Germany!

Development banks not only provide finance directly to specific projects, they also channel funds to financial intermediaries in developing and emerging economies. Development banks have committed to align themselves with the Paris Agreement. While they have made (some) progress with establishing Paris lending criteria for their direct lending activities – clear rules and guidance for how to align “intermediated lending” with the Paris Agreement remains a gap. This Blog provides a rational for Paris alignment of MDBs’ intermediated lending and proposes a phased approach that development finance institutions can follow to fulfil their commitments.

For a year and a half, representatives from the real economy, the financial sector, academia and civil society fought hard to reach an agreement on how Germany could become a prime hub for sustainable finance . On February 25, the final report of the German government's Sustainable Finance Advisory Council (SFB) was published, with ambitious recommendations on how to make the financial market more sustainable: Shifting the Trillions - A Sustainable Financial System to facilitate the Great Transformation. It is now the government's turn to translate the recommendations into an effective strategy and initiate the first legislative changes before the end of this legislative term.

The European Commission is focusing on hydrogen from renewable electricity, to accelerate the decarbonization of the various sectors and to achieve climate neutrality in 2050. What does this mean for the future of energy imports from Russia, currently the largest supplier of natural gas to the European Union? A chance, the authors of this background article find, and elaborate on challenges and first steps on how to leverage this opportunity.