Overview

  • Climate change is already impacting countries and communities around the world, with the most vulnerable hit the hardest. 

    2016 was the hottest year since record-keeping began, and in November 2016 the UN announced that global temperatures have risen 1.2 degrees Celsius above pre-industrial levels. 

    Under the Paris Agreement (adopted December 2015, in force November 2016), the world committed to limiting the rise in global temperatures to below 2C by the end of the century. 

    Climate change increases volatility and threatens efforts to end poverty.

    Without urgent action to reduce vulnerability, provide access to basic services, and build resilience, climate change impacts could push an additional 100 million people into poverty by 2030.

    The impact of extreme natural disasters is equivalent to a $520 billion loss in annual consumption, and forces some 26 million people into poverty each year.

    Climate change will contribute to significant shifts in population settlements over time; development planning will have to take such shifts into account.

    The financing required for an orderly transition to a low carbon, resilient global economy can be counted in the trillions, not billions.  

    Over the next 15 years, the world will require about $90 trillion in new infrastructure – most of it in developing and middle-income countries.  Making the right choices in favor of infrastructure that is climate resilient and locks in a low carbon development pathway is critical and urgent.  Action now will avoid huge costs later.

    To mobilize private sector climate financing at scale, the world needs a greener financial sector that integrates climate risks and opportunities, and expands the use of approaches such as risk mitigation, blended finance and green bonds. 

    Carbon pricing delivers a triple dividend – it protects the environment, raises revenue, and drives investments to clean technologies. Greater cooperation through carbon trading could reduce the cost of mitigation by 32 percent by 2030.

    Climate action makes good business sense

    The IFC estimates that the NDCs of 21 emerging market economies alone represent $23 trillion in investment opportunities. Post-Paris, 200 companies with a market capitalization of $4.8 trillion have set emissions targets, and more than 800 companies are planning to put a price on carbon.

    Achieving the goals of the Paris Agreement will require coordinated global action at an unprecedented scale and speed.

    The SDGs will only be achieved if tackled along with climate change. The world will need to feed 9 billion people by 2050 while reducing emissions, provide electricity access to 1.1 billion people while transitioning from fossil fuels, and prepare for 2 billion new urban dwellers while reducing the carbon footprint of cities and improving urban resilience.  

    The World Bank Group (WBG) is more committed than ever to helping countries meet the climate challenge and achieve their NDCs.

    The WBG’s twin goals of ending extreme poverty and boosting shared prosperity cannot be achieved without tackling climate change.

    More than 140 WBG client countries have submitted national plans for climate action – the Nationally Determined Contributions, or NDCs.

    We are actively working with countries to help them deliver on and exceed their Paris ambitions, including through financing, technical assistance and knowledge sharing.

    Last Updated: Mar 28, 2017

  • Between FY2011 and FY2016, the WBG committed $63 billion dollars, an average of more than $10 billion a year, to more than 1,000 climate-related projects that help countries adapt to a changing climate and mitigate the impacts of climate change. In FY2016 alone, the WBG provided $10.4 billion in financing to 177 climate-related projects.

    In FY2016, the International Finance Corporation (IFC) made close to $2 billion in climate-related long-term investments from its own account and mobilized an additional $1.3 billion, for a total of $3.3 billion invested in climate-smart projects.

    The WBG has committed to increase climate financing to 28 percent of the Bank Group’s portfolio by 2020, in response to client demand.  At current levels of co-financing, that would mean a potential $29 billion a year for climate projects by 2020.

    The WBG Climate Change Action Plan, adopted in April 2016, lays out concrete steps to meet that commitment. It includes ambitious targets to be met by 2020, including helping client countries add 30 gigawatts of renewable energy, put in place early warning systems for 100 million people, and develop climate-smart agriculture investment plans for at least 40 countries

    Under the Action Plan, IFC aims to expand its climate investments from the current $2.2 billion a year to a goal of $3.5 billion a year, and will lead on leveraging an additional $13 billion a year in external financing by 2020. 

    To help countries address climate change, the WBG is focusing on five priorities:

    1) Helping countries integrate climate change into development, achieve their NDCs and set the stage for further ambition

    a.    The WBG is working with finance and development ministries to integrate climate change into national development planning and budgeting

    b.    Projects under IDA, the World Bank’s fund for the poorest countries, are screened for climate and disaster risk to ensure that they build the resilience of people on the ground.

    2) Accelerating the energy transition

    a.    Work focuses on the greatest potential reductions in GHG emissions, such as by slowing down the growth of coal-fired power plants in emerging economies.

    b.    To scale up the implementation of renewable energy and energy efficiency, the WBG helps develop enabling policy and business environments, strengthen electricity grids, and de-risk investments. 

    c.    The WBG is helping to accelerate the phase-out of HFCs and support energy efficiency measures.

    3) Facilitating the expansion of sustainable infrastructure

    a.    The WBG facilitates private sector finance where it is possible, and targets concessional finance where it is needed most and can have the greatest impact.

    b.    Climate change will take a heavy toll on the infrastructure of poorer countries.  The WBG builds capacity to integrate climate change considerations into the planning and design of long-lived investments.

    4) Boosting the climate resilience of communities, economies and ecosystems

    a.    The WBG helps countries better manage water and other natural resources, develop climate-smart agriculture, support sustainable forest management that supports livelihoods and economic growth, and expand climate-responsive social protection.

    b.    A comprehensive approach to disaster risk management can protect lives, livelihoods and assets. 

    5) Unlocking trillions in climate finance, including by

    a.    Working with private sector partners to expand green finance approaches

    b.    Helping countries adopt global best practices for putting a price on carbon 

    Last Updated: Mar 28, 2017

  • In Ethiopia, between 2010 and 2015, sustainable land management practices were adopted on 260,000 hectares of land, transforming the lives and livelihoods of 700,000 people. More than 125,000 people were trained in planning and using sustainable and climate-smart/resilient land management practices.

    In Cameroon, the World Bank is helping to improve the productivity and competitiveness of livestock production systems. The $100 million project aims to build resilience to climate change and improve the nutrition status of vulnerable populations.

    In Mexico, a program that leverages almost $500 million in World Bank financing is helping rural communities sustainably manage their forests and generate income from forest products, while reducing emissions. The program is designed to cover 30 million hectares, and more than 3,000 communities nationwide.

    In October 2016, parties to the Montreal Protocol agreed to phase down the production and consumption of HFCs, potent greenhouse gases used predominantly in air conditioning and refrigeration. The Bank Group supports this by helping countries phase down HFCs and improve energy efficiency in air conditioning and refrigeration.

    In Zambia, an auction under the Scaling Solar program saw a winning bid of 6 cents a kilowatt hour - the lowest prices for solar power to date in Africa, and among the lowest recorded anywhere in the world.

    In Bangladesh, a World Bank-financed electrification project to promote off-grid electricity in rural communities is one of the fastest growing renewable energy programs in the world – to date, more than 3.5 million solar home systems have been installed in rural Bangladesh, creating 70,000 direct jobs. A total of 2.9 million families in Bangladesh have benefited from the construction of 220 new cyclone shelters since 2007. And in October 2016, WBG President Jim Yong Kim pledged $2 billion over the next three years in new funding to help Bangladesh reduce vulnerability to climate change.

    IFC’s investment portfolio for green buildings has surpassed two billion dollars, including own account investments and mobilized financing. As part of this, the EDGE Green Building Market Transformation Program supports green building codes and standards, finances the construction of green homes, hospitals, and schools, and helps banks increase their green lending.

    Since 2000, flood and drought events have cumulatively affected more than 13 million people across Sri Lanka. In an effort to reduce the adverse impacts of these events, the Global Facility for Disaster Reduction and Recovery (GFDRR), the World Bank, and the government of Sri Lanka developed the “Comprehensive Approach to Climate Risk Management” program. The $110 million initiative is working to make transport and school infrastructure more resilient to future weather events, benefiting 745,000 people.

    In Bosnia and Herzegovina, a GFDRR assessment after major flooding led to a $100 million World Bank grant to finance emergency goods and rehabilitate high-priority infrastructure. More than 105,000 people received emergency assistance, and more than 500,000 people, nearly half of whom are women have benefitted from rehabilitated infrastructure and flood protection in affected areas since the 2014 floods.

    Last Updated: Mar 28, 2017

Api




PHOTO GALLERY

More Photos Arrow

In Depth

image

IDA and Climate Change

IDA helps the poorest nations adapt to climate change by building their resilience to disasters, and promoting sustainable development to ...

image

Carbon Pricing Leadership Coalition (CPLC)

The Carbon Pricing Leadership Coalition brings together leaders from across government, the private sector and civil society to share ...

image

Climate Investment Funds

The $8.3 billion Climate Investment Funds (CIF) is providing 72 developing and middle income countries with urgently needed resources to ...

image

Connect4Climate

Connect4Climate is a global partnership program launched by the World Bank Group and the Italian Ministry of Environment, joined by the ...

Additional Resources

Contact

Media Inquiries
Elisabeth Mealey
emealey@worldbankgroup.org