Countries must build greener, climate-resistant economies: IMF

16 April, 2021 12:00 AM printer

WASHINGTON: Countries must take action on climate change now to avert future disasters, accelerate the push for greener economies and boost the economic recovery from the Covid-19 pandemic, the International Monetary Fund’s chief said.

A policy mix of carbon taxes and green investment stimulus could increase the level of global output in the next 15 years by about 0.7 per cent and create around 12 million new jobs through 2027, Kristalina Georgieva, IMF managing director, said in a speech on Thursday on green finance and climate policy in Washington, DC, report agencies.

“If we are to achieve a more sustainable and inclusive recovery, we must turn this crisis into opportunity by building greener and more climate-resilient economies,” she said. “To achieve the goal of reducing climate risks and averting future calamities, action during this decade will be critical.”

The Covid-19 pandemic has forced governments around the world to consider ways of re-building more sustainable economies and use the crisis as an opportunity to better tackle climate change challenges. The IMF chief emphasised the need for governments to take swift action on climate change now to avoid future disasters.

For example, in low-income countries, climate change is already a key driver of rising poverty, accelerating spread of disease, and worsening food insecurity, Ms Georgieva said. The Asia-Pacific region is already experiencing faster-rising temperatures and more weather-related natural disasters than anywhere else – with coastal areas and small island countries affected the most, she said.

In her speech, the IMF chief outlined key economic policy tools for climate mitigation.

IMF research showed how economic policy tools can pave a road toward net zero emissions by 2050, in a way that supports economic growth, employment and income equality.