ECB’s Lagarde: Time to Close the Global Climate Finance Gap

12 November 2024

By David Barwick – FRANKFURT (Econostream) - European Central Bank President Christine Lagarde on Tuesday urged against the backdrop of the latest United Nations Climate Change Conference (COP) that the global climate finance gap be closed.

In a blog post on the website of the ECB, Lagarde warned that ‘[c]limate change and nature degradation will transform our societies irrespective of the actions we take.’

The inevitable adaptation had to occur ‘in a manner that is fair and equitable’, she said.

Failure to respond to climate change would only force societies to respond to the environmental consequences, she said. Wealthier countries were obliged to assist their poorer neighbours, she said.

‘But here again, our efforts are far from sufficient, and funding for climate disaster relief is a long way from where it needs to be’, she said.

In this context, Lagarde called for developed economies to contribute more capital to the Loss and Damage Fund agreed at the COP two years ago.

The associated economic threat was why the ECB considered climate change and nature degradation in the pursuit of price and financial stability, she said. However, governments had to take the lead, flanked by other actors, she said.

‘Tackling climate change and safeguarding biodiversity fairly and equitably is not a task we can afford to leave to future generations – it is our duty to act now’, she said.

‘To ensure our economic survival, we need to invest in our green and resilient future’, she continued. ‘This year’s COP marks the time to close the global climate finance gap.’