Diokno: Financing climate action, indispensable to economic growth and development

Finance Secretary Benjamin E. Diokno emphasized the need for economies to incorporate climate financing into their development efforts in his message for the Vulnerable Twenty (V20) Group Ministerial Meeting X “From Accra to Marrakech: Advancing Fit-for-Climate Financial Architecture and Development-Positive Climate Action” on April 16, 2023.

“We must strike a balance between achieving sustainable and resilient economic development and addressing the intensifying climate crisis, which has compounded the complexities of managing public debt and market policies,” he said in his video intervention during the 2023 Spring Meetings of the International Monetary Fund (IMF) and the World Bank Group (WBG).

“Financing climate action should not be seen as a competing priority. Rather, it should be treated as an indispensable part of economic growth and development,” Secretary Diokno added.

Established in 2015, the V20 Group of Ministers of Finance of the Climate Vulnerable Forum is a cooperative of economies that are systemically vulnerable to climate change.

The V20 was created to strengthen economic and financial responses to climate change. It aims to share best practices, develop better approaches to climate finance, and promote the mobilization of public and private climate finance.

Secretary Diokno explained that developing and climate-vulnerable countries such as the Philippines are adversely affected by the intensifying climate risks and hazards.

According to the WBG’s Philippines Country Climate and Development Report, climate inaction will lead to substantial economic and human losses, reducing the country’s gross domestic product (GDP) by 13.6 percent by 2040, with the poor being the most affected.

“Climate change adaptation is an urgent priority for the Philippines. For this, we rally to pursue concrete actions in addressing, minimizing, and averting loss and damage, specifically loss and damages experienced due to climate change,” Secretary Diokno said.

According to him, the amount of climate finance towards climate change mitigation and adaptation actions should correspond to the needs of developing and climate-vulnerable countries, taking into account the economic and non-economic losses and damages from climate change.

As such, governments have the responsibility of creating a conducive environment for private and public collaboration in order to expand climate initiatives.

“This collaboration will bolster our climate agenda and advance a financial architecture that is truly fit-for-climate and development-positive,” Secretary Diokno said.

He also emphasized the need for a whole-of-society approach in tackling the climate crisis, hence the need to promote environmental, social and governance (ESG) investing.

“Together, we must raise our collective ambitions and respond to the climate crisis with urgency, speed, and scale. The Philippines eagerly awaits the concrete collective actions borne out of these discussions,” Secretary Diokno said in closing.