South Asia and Beyond

Grants Vs Loans: ‘Developed Nations’ Aid To Developing In $100 Bn Fund Needs Significant Rise’

NEW DELHI: In our special series on the global climate crises, Helen Clark, three-time Prime Minister of New Zealand,
Administrator of the United Nations Development Programme(UNDP) for two tenures, Co-chair of the World Health Organisation(WHO) established Independent Panel for Pandemic Preparedness and Response and Editor, ‘Climate Aotearoa’ in conversation with StratNews Global Associate Editor Amitabh P. Revi.

The 2009 Copenhagen climate summit agreed that developed countries would provide $100 billion a year to developing nations by 2020. In September 2021, a Organization for Economic Cooperation and Development(OECD) report estimated that developed countries provided or mobilised just $80 billion in mitigation and adaptation finance for their developing counterparts in 2019. Even of that reduced amount, a “very significant proportion” of the $ 100 billion a year in climate finance for low and middle income countries(LMICs) is in loans not grants, Helen Clark points out. She says LMICs argue that “high income countries have caused a lot of the climate problems and LMICs are now expected to borrow money to deal with it.” The “proportion of grant finance in that $100 billion needs to go up very, very significantly,” she adds in this interview.

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