Nicholas Stern welcomes new suggestion for 'Green Fund' by Managing Director of International Monetary Fund
Nicholas Stern has welcomed a speech today (8 March 2010) in Nairobi, Kenya, by Dominique Strauss-Kahn, the Managing Director of the International Monetary Fund (IMF), in which he announced that his staff are working on a ‘Green Fund’ which would have the capacity to raise US$100 billion per year by 2020 to assist climate change mitigation and adaptation in developing countries.
Lord Stern, chair of the Grantham Research Institute on Climate Change and the Environment at London School of Economics and Political Science, said: “The ‘Green Fund’ is a creative and constructive idea which shows that the International Monetary Fund recognises clearly the very serious risks that climate change creates for future global economic growth and development. Both the risks and the necessary response have major macroeconomic implications. As serious as the current economic crisis is, climate change poses an even more profound and fundamental threat to the world if we do not tackle it; as Mr Strauss-Kahn said: “This could well be the shock to end all shocks”. As the world attempts in this decade to manage the build-up of debt in many countries and global saving-investment imbalances, we must at the same time embark on a path of radical reductions in global greenhouse gas emissions, and with this new idea, the IMF is rising to a huge and urgent challenge.
“The two great challenges facing the world this century are managing climate change and overcoming poverty. If we fail on one, we will fail on the other. Developing countries need significant financial support for their plans to make the transition to low-carbon economic development, and to help them adapt to those impacts of climate change that cannot now be avoided. All countries of the world must both reduce emissions and adapt, but Africa will be hit earliest and hardest.
“A ‘Green Fund’ could raise resources for developing countries quickly and effectively; speed is of the essence as there are great dangers in delay as concentrations of greenhouse gases continue to rise in the atmosphere. I am sure that this important idea and the detailed work which the IMF is carrying out will be studied with great interest by the High-Level Advisory Group on Climate Change Financing that has been launched by the United Nations Secretary-General, Ban Ki-moon. The Managing Director of the IMF must be congratulated on his new initiative.”
Lord Stern was among the 19 members of the High-Level Advisory Group on Climate Change Financing who were named by the United Nations Secretary-General on 4 March 2010. The Group is being chaired by Meles Zenawi, the Prime Minister of Ethiopia, and Gordon Brown, the British Prime Minister. The first meeting of the Group will take place in London on 29 March 2010.
Notes for Editors
- Nicholas Stern was Second Permanent Secretary at HM Treasury between 2003 and 2007. He also served as Head of the Government Economic Service, head of the review of economics of climate change (the results of which were published in ‘The Economics of Climate Change: The Stern Review’ in October 2006), and director of policy and research for the Commission for Africa. His previous posts included Senior Vice-President and Chief Economist at the World Bank, and Chief Economist and Special Counsellor to the President at the European Bank for Reconstruction and Development. He was recommended as a non-party-political life peer by the UK House of Lords Appointments Commission in October 2007. Baron Stern of Brentford was introduced in December 2007 to the House of Lords, where he sits on the independent cross-benches.
- The Grantham Research Institute on Climate Change and the Environment was launched at the London School of Economics and Political Science in October 2008. It is funded by The Grantham Foundation for the Protection of the Environment. Lord Stern is also Chair of the Centre for Climate Change Economics and Policy, which is hosted by the University of Leeds and the London School of Economics and Political Science. He is also I.G. Patel Professor of Economics and Government and Director of the India Observatory at London School of Economics and Political Science.