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The Sharm El-Sheikh Climate Implementation Summit concluded with more than 100 heads of state committing to support the world’s vulnerable communities. Over the two days of the Summit, a series of six roundtables addressed the most pertinent climate challenges including food, water, and energy security, as well as innovative finance mechanisms for climate and development.
At the inauguration, Egypt’s President Abdel-Fattah El-Sisi and Secretary General of the UN Antonio Guterres welcomed world leaders.
The six roundtables over two days covered Food Security, Innovative Finance, Just Transition, Investing in the Future of Energy: Green Hydrogen, Climate Change and the Sustainability of Vulnerable Communities and Water Security.
Food Security
During the roundtable on “Food security,” co-chaired by HE William Ruto, President of Kenya and HE Ulf Kristersson, Prime Minister of Sweden, the Bill and Melinda Gates Foundation pledged to invest $1.4 billion over four years to support smallholder farmers, particularly women, with innovative digital technologies.
The IFC also announced the launch of their $6 billion global food security platform ($3B IFC, $2B from private investors, $1B as blended finance)
A number of key players from the private sector also made net zero pledges during the high-level segment, including JBL – the largest meat processing company in the world – and UPL – a key player in the agrochemicals industry to achieve carbon neutrality.
Reinforced a leadership imperative and commitments by many countries to do more and increase adaptation in agriculture action and support, particularly in Africa.
Several international organizations have recognized the role of COP27 Food and Agriculture for Sustainable Transformation “FAST” global flagship initiative in responding to the urgency of implementation, as a multi-stakeholder partnership delivering triple wins: for people, for climate and for nature.
Bold announcements to harness the enabling environment of green hydrogen fertilizers by African countries were made.
Innovative Finance
The ‘innovative finance’ roundtable co-chaired by HE Emmanuel Macron, President of France and HE Mia Mottley, Prime Minister of Barbados, saw an agreement on the role of Special Drawing Rights (SDRs), with joint calls to increase allocations from 20% to 30%, a target that can be implemented in cooperation with the IMF. Speakers noted the role of IMF’s Resilience and Sustainability Trust is an instrumental starting point but called for additional work in this regard.
A joint call for concessional finance to be based on a climate vulnerability basis rather than an income capacity basis, with representatives of developing countries highlighting that access to finance remains an obstacle to many especially towards efforts to implement their Nationally Determined Contributions (NDCs).
The need for MDB’s reform was highlighted among the key priorities before Spring meetings to allow for more climate centric projects funding, while participants jointly agreed that the way forward would be through private sector investments namely in agriculture and energy. Participants also reiterated the need for debt restructuring and liquidity access especially in the developing and least developed countries in light of the current food and energy crisis.
WEF expressed its interest to launch a coalition of companies willing to commit to investing in renewable energy in emerging and developing countries.
Just Transition
Discussions within the roundtable, co-chaired by HE Charles Michel, President of the European Council and HE Cyril Ramaphosa, President of South Africa, emphasized the need for strategies, policies, mobilization of appropriate finance at scale, technology, capacity building and major investment to ensure a just transition for the affected communities.
The massive scale of the challenges requires major efforts exerted by not just by governments and the energy sector but also from international financial institutions and donors, as well as multilateral development banks and other non-state actors.
Participants underscored that transition must be just and inclusive, leaving no one behind. The affected communities must be brought along, own the transition processes and being part of the solution. While some best practices exist, there is no one-size fits all approach and financial support and capacity building need to be adjusted to specific needs and each country’s contexts.
They also discussed opportunities for job creation arising from new economic activities that require establishing mechanisms that would allow for forms of training, capacity building, forms of reallocations of resources, including creating social protection systems that support transition.
Several participants stressed on the importance of finance as a key component in implementing a just transition, as public finance can provide the right conditions for private financing to achieve the scale required, such as reducing investment risk. Others emphasized that the multilateral financial architecture plays a crucial role in mobilizing public and private finance, which can unlock the barriers developing countries are facing.
During the discussion, participants discussed the role of digital transformation in the transition towards a low-carbon economy and the need to take that into account while designing climate and social policies in support of the transition.
Several solutions were demonstrated to deliver on finance and committing to pledges through different approaches such as partnerships (e.g. Just Energy Transition Partnership) or by leveraging existing partnerships, provisions of grants, provisions of concessional loans, or debt reliefs, in particular, for developing and middle income countries. These means can also be used to assist those who are impacted adversely by the transition or to lower the capital costs and unlock private finance to achieve a just transition.
Investing in the Future of Energy: Green Hydrogen
At the “Investing in the Future of Energy: Green Hydrogen” co-chaired by HE Abdel Fattah El-Sisi, President of Arab Republic of Egypt and HE Olaf Scholz, Chancellor of Germany, major announcements were made in respect of green hydrogen with The President of the Arab Republic of Egypt, Mr. Abdel Fattah El-Sisi, and the Prime Minister of Belgium, Mr. Alexander De Croo, announcing the launch of the “Global Renewable Hydrogen Forum”. The Forum constitutes a multi-stakeholder public-private platform designed to facilitate large-scale deployment of renewable hydrogen to foster decarbonization of local industries, accelerate just transition and unlock the environmental and socio-economic benefits of the global hydrogen economy, as well as to identify the best instruments enabling the cross-border trade of renewable hydrogen between renewables-rich developing countries the developed countries.
Moreover, President Sisi announced the Egyptian-Norwegian green hydrogen project, which provides a practical model of investment partnership that stimulates sustainable economic development with a focus on the role of the national and foreign private sector besides the government’s role, working side by side in the sector. Later, The President and the Norwegian Prime Minister jointly launched the first phase of the project to establish a major green hydrogen plant in Ain Sokhna, Egypt.
Climate Change and the Sustainability of Vulnerable Communities
Discussions at the roundtable, “Climate Change and the Sustainability of Vulnerable Communities”, co-chaired by HE Jonas Gahr Støre, Prime Minister of Norway and HE Shehbaz Sharif, Prime Minister of Pakistan; reiterated how from a strictly financial perspective, investing in adaptation has proven profitable. With relief, rescue, rehabilitation, and reconstruction due to climate-induced floods having proved costly and avoidable.
With the recent floods in Pakistan and other climate-induced devastations in the Horn of Africa and the Sahel region the urgent need to build resilience and advance adaptation to climate change and capitalize funds in a way that is equitable took center stage.
A call from the private sector asked for governments to provide guarantees as an enabler to adaptation efforts. Accessibility to finance for small businesses was also raised as a contributor to incentivizing decarbonization. The need to enable more projects to be bankable so that investment in adaptation can be made to protect the most vulnerable in developing countries was also raised.
The roundtable on water security, co-chaired by HE Kyriakos Mitsotakis, Prime Minister of Greece and HE Macky Sall, President of Senegal discussed the basic human need for sustainable access to adequate quantities of and acceptable quality water for sustaining livelihoods, human well-being, and socio-economic development. As well as for ensuring protection against water-borne pollution and water-related disasters, and for preserving ecosystems in a climate of peace and political stability.
Several interventions addressed the need to ensure universal access to safe water and sanitation in order to achieve SDG6, and adopt climate-resilient policies for sustainable water management, including rainwater harvesting, sustainable withdrawal of renewable ground water, and increasing non-conventional water reuse, and alluded to the importance of adhering to the principles of inclusive cooperation, constructive engagement and mutual support among states sharing water resources in implementing water-related adaptation projects in transboundary water basins.
Success stories on water management were showcased, while UN organizations representatives reflected on ways to scale these techniques to other water-stressed countries and identify tangible actions to accelerate the implementation of key water security projects worldwide, including early warning systems, including the “Action on Water Adaptation and Resilience” initiative (AWARE), to be announced by the COP27 Presidency soon, and its envisaged role in decreasing water losses worldwide and improving water supply as well as supporting the implementation of mutually agreed policies and methods for cooperative water-related adaptation action.
Interventions emphasized the importance of Integrated Water Resource Management (IWRM) as a cross‐sectoral approach at the core of SDG6, designed to promote the coordinated development and management of water, land, and related resources to maximize economic and social welfare equitably, without compromising the sustainability of ecosystems and the environment.
