Overlooked until now, climate finance may be the answer to a low-emissions future for New Zealand.
That’s the message from The Policy Observatory’s Dr David Hall and Sam Lindsay of economic research collective Mōhio, who prepared the report for the Ministry of Environment. Investigating opportunities for New Zealand in climate finance, they outline ten recommendations.
The report, which was launched on 13 April, saw the Minister for Climate Change James Shaw and key sector leaders in government, finance and philanthropy meet to talk about a low-emissions future for New Zealand, made possible through the economic opportunities that arise from climate finance.
What is climate finance?
According to Dr Hall, climate finance is any spending, projects or activities that go towards climate mitigation, climate adaptation or both.
“Climate finance is any investment that tries to tackle the problem of climate change, whether it means reducing emissions, removing carbon dioxide from the atmosphere or preparing communities and their infrastructure. It’s about preparation and planning,” he says.
While climate finance exists, there’s not enough of it.
“Climate finance is not something that anyone has looked at domestically. Before the report, no one had done an analysis or looked at the benefits.”
Applying a framework specifically to New Zealand, the report outlines tangible ways in which the country can make use of climate finance, Dr Hall says.
Climate action is not just about making sacrifices, there’s also the potential for positive outcomes including creating jobs in new industries and investing in low-emission businesses.
The Government is already focusing on some of the recommendations made in the report including establishing a Green Investment Fund, fixing the Emissions Trading Scheme to provide effective carbon pricing, and looking at options for disclosure and reporting of climate-related financial risks
David says that although this is a great start, many of the recommendations are not solely the Government’s responsibility and rely on cross sector co-operation, as about two thirds of all climate finance globally comes from the private sector.
“Private sector parties have their own responsibilities, and it’s about the public and private sectors working together,” he said.
The report has started a cross-sector conversation, and David intends to keep it going.
“I’m keen to keep talking with the parties that were at the event, including banks, researchers, the Government, local council and local industries and businesses.
“Think of it this way. This is a productive investment into infrastructure that will support a more sustainable future for ourselves and our children.”