No country should have to choose between fighting poverty and protecting the planet, French President Emmanuel Macron said Thursday at the start of the Summit for a New Global Financial Pact in Paris.
International financial reform will be high on the agenda of the two-day summit, beginning in Paris on Thursday with about 50 heads of state attending, along with representatives of international organizations and civil society.
The event will specifically focus on helping the most vulnerable developing countries tackle poverty and climate change.
Addressing these challenges will take increased private funding and a public finances overhaul, stressed Macron, who had revealed plans to host the summit after COP27 international climate conference in November 2022.
Last week, in a joint article in the French daily Le Monde, Macron and 13 other political leaders, including U.S. President Joe Biden, emphasized their urgent commitment to combating poverty and inequality.
They expressed concerns that climate change will lead to more frequent and devastating disasters, disproportionately affecting the world's poorest and most vulnerable populations.
The head of the International Monetary Fund (IMF) said Thursday that rich countries had met a target of reallocating $100 billion of funds from the institution to battle climate change and poverty in developing countries.
"We meet the target, we do have the 100 billion," Kristalina Georgieva told a roundtable discussion at the summit.
Ahead of the summit, the IMF still needed another $40 billion to hit the target, she said.
The plan, first announced in 2019, was for wealthier countries to recycle $100 billion in IMF special drawing rights (SDRs) for vulnerable economies.
SDRs are foreign exchange reserve assets awarded to countries based on how much they contribute to the IMF.
The idea, which some European countries resisted, was for wealthier countries to lend these foreign exchange reserve assets to the IMF, which could in turn lend them to developing economies.
Ahead of the summit, France and Japan announced that they would redeploy 30% of their SDRs for this purpose.
Veteran president of Congo, Denis Sassou-Nguesso, however, highlighted how pledges from rich countries to help vulnerable countries had failed to materialize, including a promise to provide $100 billion a year at a COP climate summit in Copenhagen in 2019.
"Every time there's a COP meeting we make the same announcements. In Copenhagen, it was announced that there would be $100 billion per year for poor countries, but we never saw it. It didn’t reach us," he told an audience.
The world needs a global "Marshall Plan" to combat climate change and a tax on financial transactions could help fund the fight, Colombia's President Gustavo Petro meanwhile told world leaders at the summit.
European Commission President Ursula von der Leyen, on the other hand, said the international community must look at ways of introducing global carbon pricing to accelerate the transition to a lower-carbon economy.
Von der Leyen also said that the world needed to expand the greenhouse gas emissions that are covered by a carbon price to support the energy transition, calling the current percentage of emissions covered by a price "almost nothing."