G7 and the vulnerable 20 (V20) of 58 climate vulnerable economies have launched the Global Shield against Climate Risks, which is an initiative for pre-arranged financial support designed to be deployed in times of climate disasters.
Key points
- The Global Shield is among the first concrete mechanisms for climate funding — money that was meant to flow from developed nations to developing and at-risk countries but has largely been lacking.
- The new initiative is structured in an insurance mechanism that experts expressed scepticism over.
- Initial contributions include around 170 million euros from Germany and more than 40 million euros from other countries.
- A broad coalition of countries, multilateral institutions, non-state and private sector partners has underlined institutional commitment to Global Shield.
- The first recipients will include Bangladesh, Costa Rica, Fiji, Ghana, Pakistan, the Philippines and Senegal.
- In terms of implementation, the Global Shield will align behind vulnerable country strategies for closing protection gaps using a broad range of appropriate instruments.
- At the household and business level, these instruments comprise livelihood protection, social protection systems, livestock and crop insurance, property insurance, business interruption insurance, risk-sharing networks, and credit guarantees.
Concerns
- Experts cautioned that such an initiative cannot replace the need for Loss and Damage funding under the United Nations Framework Convention on Climate Change that is being sought by vulnerable nations.
