New York, June 1 (HNA) – The World Bank Group (WBG) and the International Monetary Fund (IMF) are embarking on a significant journey, deepening their cooperation through an enhanced framework. This joint effort is designed to help countries scale up action to confront the threat of climate change, a crucial task that the financial groups are committed to, as stated in their Joint Statement.
“The collaboration will provide critical support for countries’ climate strategies—through an integrated, country-led approach to policy reforms and climate investments. Within their respective mandates, the World Bank Group and the IMF will leverage their analytics, technical assistance, financing, and policy expertise to enhance country-driven reform programs,” read the Joint Statement.
According to the Joint Statement, three principles will underpin the framework:
– First, countries, the World Bank Group, and the IMF will work together closely to identify each country’s climate challenges—and the priority policy reforms needed to address them. This process will be informed by the World Bank Group’s Country Climate and Development Reports (CCDRs), the IMF’s climate-related analytics, and countries’ climate ambitions.
– Second, the World Bank Group and the IMF will work with other Multilateral Development Banks and development partners to help countries implement the reforms through technical assistance and financing.
– Third, upon request, the World Bank Group and the IMF will help establish country-led platforms designed to mobilise additional climate finance, including from the private sector.
The enhanced framework will build on lessons learned since the release of the institutions’ Joint Statement on Enhancing IMF-World Bank Collaboration in September 2023.
“This enhanced cooperation between the two institutions will foster country-driven partnerships, galvanise policy changes, and scale up investments to meet countries’ climate needs” said the financial groups, adding that the joint effort will also optimise the increased resources the institutions are dedicating to climate action and crowd-in additional resources from development partners and private sector.
The Joint Statement of the leading financial groups, the WBG and the IMF, went on as follows:
“The World Bank Group was ramping up its climate action with new measures including devoting 45 percent of annual financing to climate change adaptation and mitigation by 2025, working to bring renewable power to 250 million people in Africa by 2030, and expanding its crisis toolkit to support people on the front lines of the climate crisis. The institution has also optimised its balance sheet and is raising funds for a robust IDA21 replenishment and a new Livable Planet Fund.
“The IMF is helping countries build resilience to climate change with support from its Resilience and Sustainability Trust (RST), which is funded by generous contributions from 23 countries. Since its operation in October 2022, 18 countries have benefitted from the RST. The enhanced WBG-IMF collaboration framework is expected to raise the impact of the SDRs channelled through the RST.”