The cost of the transition
The transition to production and consumption systems compatible with the environment and able to stop the increase in global temperatures requires very high costs, even if according to the IMF (for example), they would be outweighed by the damage caused by global warming.
Who should pay and how to mobilize private resources remain among the most difficult problems to solve, so much so that Cop26 dedicated the third day of work to the issue, after the speeches of world leaders and with the delegations working to reach a shared agreement. This is where the Gfanz comes in. According to Carney, to allay fears about the cost of the energy transition, “we need a radically new approach, with new mixed finance structures and platforms to bring public and private funds together. These initiatives can give confidence to invest ». With Gfanz, Carney underlined “we have the money for transition, now we have to plan it”.
Larry Fink, chief executive of BlackRock, said “distributing that capital will be much more difficult” than securing commitments. For Citigroup CEO Jane Fraser, “it is extraordinary that the initiative can affect assets worth 130 trillion, but if you don’t work together, you have a lot of good speeches, but you run the risk of being out of reality.”
The front of the skeptics
In short, astronomical figures that do not convince everyone. On the contrary. According to the French non-profit organization Reclaim Finance, none of the sub-alliances that make up Gfanz require signatories to stop funding fossil fuels. And since Paris 2015, world banks have funneled $ 4 trillion into oil, gas and coal – 500 billion this year alone, according to Bloomberg data. Mark Campanale, founder and executive president of the Carbon Tracker Initiative, stresses that there is still a lack of clarity on how the objectives of the Gfanz can be achieved.
London hub of green finance
For the British Chancellor of the Exchequer, Rishi Sunak, the commitments made by the coalition are “historic”. The British government proposes London as the financial center for the fight against climate change. Sunak has announced rules to push the country’s main companies to detail their plans to adapt to the national zero emissions target by 2050 starting from 2023, submitting them to a committee of independent experts.