EconomyEditor's PickDoF’s Dominguez proposes climate financing via multiple channels

November 4, 2021

FINANCE Secretary Carlos G. Dominguez III said climate financing should be done through grants, investment, and subsidies to improve vulnerable communities’ ability to adapt to climate risks.

Mr. Dominguez, who represented the Philippines at the 26th United Nations Climate Change Conference (COP26) in Glasgow, said that climate financing should be done through this three-point “blended approach.”

He had been pushing for more climate financing from wealthy economies that have not offered enough to help developing nations reduce their carbon footprints as they transition to clean energy.

Such countries bear the most responsibility for their historic emissions, he said in the lead up to the conference.

In a statement issued by the Department of Finance (DoF) Thursday, Mr. Dominguez said: “Grants should come in the form of educational or technical assistance programs to help people conceive and execute localized projects on the ground.”

Investment should focus on projects that create business opportunities and jobs that lead to energy self-reliance, he added.

Subsidies must address the financial costs communities take on to transition to climate-resilient economies as they start moving away from power plants that use fossil fuel.

“This blended approach should be at the heart of climate finance. Given that such funds come from investors and taxpayers, accountability and transparency must be ensured,” Mr. Dominguez said at the 4th High-Level Ministerial Dialogue on Long-Term Finance.

“Beneficiary countries need to constantly assure their donors and taxpayers and investors that their money is being used prudently.”

The dialogue tackled the progress made by countries to come up with a financial system to support climate resilience. Representatives from the UK, Uruguay, the NatWest group, and the Organisation for Economic Cooperation and Development also joined the meeting.

The Philippines has committed to reduce greenhouse gas emissions by 75% from 2020 to 2030. Of the 75% target, just 2.71% can be achieved with internal resources, while the remaining 72.29% is conditional on international assistance. — Jenina P. Ibanez

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