FinancialGuy Writes!

With the Copenhagen summit approaching fast, the daily news is covered with stories about climate change, both good and bad.

One area that seems to be ignored by the masses – and often the media – about climate change is the simple subject of ‘Who will pay?’.

While it is obvious that all of humanity has a stake in reducing emissions and our individual and collective footprints, most people seem to believe that this involves someone else doing something. To a certain extent, this is true. We aren’t all trying to develop solar power cells or energy saving technologies in our spare bedrooms, so in that regard, we are reliant on other people.

But as more and more of these technologies are becoming available, we need to use them. We all need to use them! Rich and poor alike have an interest in taking these steps. However, those of us in the ‘rich’ or ‘developed’ world need to take action and help those of us that are less fortunate than ourselves to take action as well.

We in the developed world have the most to lose from climate change. Our protected and cotton wool covered lives will be impacted more than many others. Therefore, it is in our interests to promote – and pay for – the introduction of new technologies in the developing world.

The negotiations that will – hopefully – climax in Copenhagen have faced trouble because of the financing aspect. This is tens of billions of dollars per year and someone needs to pay.

Bailing out banks has taken precedence this year – and spent more than we can afford – but from here on, climate financing must be a priority.

In recent weeks, your author has written about the potential costs of flooding, which might be massive. But if the cost of dealing with a flood is high after the event, it seems that flood prevention is very serious.

Of course, I am not an expert in such matters, far from it. However, it is obvious that the total costs of all these problems could be enormous. Climate financing is a massive issue to us all.

And the BBC is reporting that the provisions set out to help the poorer nations is in a mess. Is this a surprise? Not really.

I know a couple of very senior people that tell me that in the region of 75% of aid promised to the developing world is never actually claimed or used. This is not – apparently – only related to climate change, instead it relates to almost ALL aid money. Wealthy governments are able – it seems – to promise huge amounts safe in the knowledge that most of it will either not be claimed or that their application and audit rules are so stringent that many applications will be unsuccessful.

How do we fix this? I’m sure I don’t know. But it needs to start with a genuine commitment to fund the projects that will provide a real difference to communities around the world. Funding climate change projects is going to need billions – if not tens of billions – of dollars in the coming decade. We need to do better.

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