Climate finance reform needed to prevent 'suicidal' chaos, Guterres says

United Nations Secretary-General António Guterres. Photo by: Jean Marc Ferré / UN Photo / CC BY-NC-ND

NEW YORK — United Nations Secretary-General António Guterres called for an overhaul of the climate finance system Wednesday, warning that all financial flows must align with the Paris climate agreement and the Sustainable Development Goals in a “race against time to adapt to a rapidly changing climate.”

“The state of the planet is broken. Humanity is waging war on nature. This is suicidal. Nature always strikes back, and it is already doing so with growing force and fury.” Guterres said during a “State of the Planet” address at Columbia University in New York City.

“But we must remember: There can be no separating climate action from the larger planetary picture. Everything is interlinked — the global commons and global well-being,” Guterres later said in his speech.

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Guterres called for a carbon tax, shifting “the tax burden from income to carbon and from taxpayers to polluters.” He also called for ending fossil fuel subsidies, integrating the goal of carbon neutrality into all economic policies, and making climate-related financial risk disclosures mandatory.

“Multilateral, regional, and national development institutions, and private banks, must all commit to align their lending to the global net-zero objective,” Guterres said, stressing the necessary increased role of blended finance in climate finance reform. He also spoke of the need to create conditions and regulations that would require business to adopt mandatory climate-related risks and release climate financial disclosures.

“This will give a very strong signal that markets should represent the realities of the economies and assets should be what they really are. If those things happen, we will see a massive flow of finance into climate mitigation and climate adaptation,” Guterres said in response to a Columbia student’s question, broadcast via livestream.

“Humanity is waging war on nature. This is suicidal. Nature always strikes back, and it is already doing so with growing force and fury.”

— António Guterres, secretary-general, United Nations

Guterres’ speech came on the same day that the World Meteorological Organization and the United Nations Environment Programme both issued new reports, showing “how close we are to climate catastrophe,” he said.

Concentrations of carbon dioxide and other major greenhouse gases continued to increase in 2019 and 2020, the WMO findings show. And the global mean temperature in 2020 is set to make it one of the three warmest years on record. This year, more than 80% of the ocean experienced at least one marine heat wave. 2020 also saw heavy rains and flooding, severe drought, and strong tropical storm activity.

To reach the Paris climate agreement’s goal of limiting temperature rise by 1.5 degrees Celsius above preindustrial levels, the world will need to decrease fossil fuel production by 6% per year over the next decade, UNEP reported in its latest findings.

Disasters cost the world $150 billion last year, according to Guterres, but the high cost of proactively addressing climate change has not been an easy sell for all governments and businesses, and carbon emissions continue to rise. Countries are projecting an average annual increase of 2% in emissions, according to UNEP.

“The commitments to net zero emissions are sending a clear signal to investors, markets, and finance ministers. But we need to go further,” Guterres said. “We need all governments to translate these pledges into policies, plans, and targets with specific timelines. This will provide certainty and confidence for businesses and the financial sector to invest for net-zero.”

Guterres also highlighted a few “important positive developments.”

The European Union has pledged to become climate neutral by 2050, joining Japan, South Korea, and more than 110 countries in their shared goal. The incoming U.S. presidential administration has announced the same target, Gutteres said.

“This means that by early next year, countries representing more than 65% of global carbon dioxide emissions and more than 70% of the world economy will have made ambitious commitments to carbon neutrality,” Guterres said. “We must turn this momentum into a movement.”

Ahead of the U.N. Climate Change Conference in 2021, Guterres called for pressure on governments to make sure their plans are ambitious enough to ensure they move to carbon neutrality by 2050.

“Until now, there has been difficulty. We need to overcome differences that exist and do a lot of active diplomacy to make sure we create a global carbon market to reduce emissions,” Guterres said.

This focus area, supported by the U.N. Development Programme, explores how climate change and other planetary imbalances impact the rising trend of human inequality and vice versa. Visit the Focus on: People and the Planet page for more.

About the author

  • Amy Lieberman

    Amy Lieberman is the U.N. Correspondent for Devex. She covers the United Nations and reports on global development and politics. Amy previously worked as a freelance reporter, covering the environment, human rights, immigration, and health across the U.S. and in more than 10 countries, including Colombia, Mexico, Nepal, and Cambodia. Her coverage has appeared in the Guardian, the Atlantic, Slate, and the Los Angeles Times. A native New Yorker, Amy received her master’s degree in politics and government from Columbia’s School of Journalism.