Business & UN

COP27 leaves 1.5 goal on “life support” says ICC Secretary General

  • 20 November 2022
ICC letter in Financial Times

Following the conclusion of the COP27 climate summit, the International Chamber of Commerce (ICC) has issued the following statement.

ICC Secretary General John W.H. Denton said:

If Glasgow succeeded in ‘keeping 1.5 alive’, that goal sadly leaves Sharm-El-Sheikh on life support. #COP27 could have delivered much more for business and far more for the planet.

Business will certainly welcome the advances made to facilitate the trading of emissions across national borders. But the implementation decisions on Article 6 ultimately fall short of creating the robust and transparent systems that the private sector needs to accelerate investment in a net-zero future. Today’s outcome must be seen as a step forward rather than an end state for international emissions trading.

The issue of financing — or, more specifically, the question of who pays — increasingly resembles a burning fuse under the entirety of the UN’s climate process. While the creation of a fund on loss and damage has averted a potentially damaging breakdown in the UNFCCC process, the debate over the past two weeks needs to be viewed squarely in the context of the precarious fiscal position many developing countries find themselves in following the COVID-19 pandemic and the ripple effects of the war in Ukraine.

Our conclusion is that implementation of the Paris agreement now hinges on the whether the G20 can finally forge a comprehensive action plan to tackle emerging market debt — and, moreover, dramatically scale the availability of concessional financing from development banks.

The pledge made in Bali by G20 leaders to limit global temperature increases to 1.5 degrees Celsius will soon start to ring hollow without a corresponding effort to tackle the growing fiscal strains faced by the emerging world. The lesson from Sharm is that, in the current economic context, effective climate cooperation just isn’t possible without genuine financial solidarity.