The need for sustainable resources, both monetary and technological, for tackling climate changes and capacity building by plugging loopholes was emphasised during the first Sustainable Finance Working Group (SFWG) meeting of G20 that concluded here on Friday, officials said.
A broad agenda was set during the two-day meeting which will be deliberated upon further and finalised during the next set of meetings of the SFWG that will culminate with the leadership summit in September.
“Money and technology are most important in addressing climate finance. How do we mobilise the money as the requirement is actually in trillions? This is the crux of the discussion as that is the most difficult question to unravel,” Ministry of Finance adviser (MoF) Chandni Raina said, briefing reporters at the end of the meet.
“There is an acceptance that it has to be a collective effort. Resources are flowing from the developed countries to the developing ones, but more needs to be done,” she said, adding that governments across the world have to create a mechanism that will encourage private investment to complement the institutional efforts.
Another MoF adviser Geetu Joshi said the discussions focussed on three priority areas – the mechanisms for mobilisation of timely and adequate resources for climate finance, enabling finance for the Sustainable Development Goals (SDGs) and capacity building of the ecosystem for financing toward sustainable development.
“There was an agreement that the public sector and MDBs (multilateral development banks) play a critical role in the mobilisation of finance at scale and reasonable cost,” she said, Joshi pointed out that there is a domestic financing gap for SDGs faced by several countries, which has increased over the years.
“The SFWG in 2023 will develop an analytical framework for financing select SDGs to complement the G20 Sustainable Finance Roadmap and will make recommendations to the stakeholders. The SFWG would also compile a compendium of case studies of best practices on financing for SDGs by jurisdictions, IOs and the private sector, as an outcome of a side event,” Joshi added.
The MoF official said the third priority, which is capacity building of the ecosystem for financing sustainable development, has been taken up because in many countries there is a lack of adequate knowledge and a scarcity of skilled professionals and workforce in sustainable finance.
She said, “To address these challenges, the SFWG will develop a G20 Sustainable Finance Technical Assistance Action Plan (TAAP). It would include identification and analysis of existing capacity-building activities and identifying the existing sustainable finance skill gaps.”
“Based on this, SFWG would give recommendations for international organisations, MDBs, international NGOs and country authorities on how to scale up capacity-building services and explore ways to form a global network for sustainable finance capacity building,” she added.
The first SFWG meeting was attended in person by 95 delegates from G20 member countries, 10 invitee countries and 14 international organisations. Many other international organisations joined the meeting virtually. The co-chairs for SFWG are USA and China.