COP28: UN Reports $7 Trillion Annual Cost of Climate-Damaging Investments

According to a shocking UN report released on Saturday at COP28 in Dubai, nearly $7 trillion of public and private funding is allocated annually to activities that directly harm the environment—roughly 30 times the amount spent on nature-based solutions annually.

The latest report from the UN's environmental wing, UNEP, reveals that investments in sectors that harm valuable assets for humanity still account for a significant 7 percent of global GDP, despite calls for their end. The report, titled State of Finance for Nature, focuses on "nature-negative finance flows" and highlights the urgent need to address climate change, biodiversity loss, and land degradation. It also emphasizes that these investments greatly surpass the amount invested in nature-based solutions, with $5 billion coming from the private sector alone. The report urges companies to not only make positive investments but also understand their contribution to the problem and engage with companies in their supply chains to drive change.

UNEP's partner, Global Canopy, stresses the importance of "greening finance" and encourages companies to not only invest in nature-positive initiatives but also address their exposure to nature-negative investments. The report emphasizes the need to tackle deforestation, a crucial aspect in achieving net-zero goals, as many financial institutions that have committed to net-zero have taken no action on deforestation. Greening finance is seen as the most significant action to be taken for the benefit of nature, climate, and people, as it involves redirecting the $7 trillion of finance towards positive impacts.

Mirey Atallah, the head of UNEP's Nature for Climate Branch, states that the report highlights how the climate crisis is surpassing containment efforts and emphasizes the importance of finance in achieving set targets. She notes that the problem lies not in the lack of funds for nature-based solutions but in the misdirection of funds. To encourage private companies to make the right investments, legal frameworks supporting nature-positive solutions must be established. Atallah highlights that some private financial institutions have begun considering climate effects when approached for loans, which can help shift investments in a positive direction. COP28 is seen as a crucial turning point to redirect harmful investments towards nature-positive solutions.

Source: news.un.org