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IMF, World Bank leaders engage finance ministers to tackle climate change

Source: Reuters - Fri, 11 Apr 2014 18:56 GMT
Author: Reuters
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IMF Managing Director Christine Lagarde listens as UN Secretary-General Ban Ki-moon speaks about climate change during the IMF/World Bank 2014 Spring Meeting in Washington, April 11, 2014. REUTERS/Joshua Roberts
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WASHINGTON, April 11 (Reuters) - The leaders of the International Monetary Fund, World Bank and United Nations on Friday called upon finance ministers to use fiscal policies, such as carbon taxes, to combat climate change.

IMF Managing Director Christine Lagarde and World Bank President Jim Yong Kim were joined by U.N. Secretary General Ban Ki-Moon at their 2014 spring meetings to address a group of 46 finance ministers and senior officials on policies to reduce greenhouse gas emissions.

Lagarde said their goal was to explain to ministers and officials what fiscal tools they can use that would benefit the environment while stimulating global economies.

She said she would discuss how to shift taxation from the traditional labor and investment base "to a base that is environmentally correct," she told reporters ahead of the meeting.

Lagarde said carbon taxes and removing fossil fuel subsidies are "intelligent" ways to reallocate resources to benefit the environment.

Last March, the IMF published a report making the case for energy subsidy reform, which it estimated amounted to upwards of $485 billion.

World Bank President Kim said climate change threatens the economic growth of the world's poorest countries and will require financial policies that may be tough to find support in some countries.

"Even though it's controversial we've got to tackle the issue of carbon pricing," he told reporters.

U.N. Secretary General Ban-Ki Moon, who has prioritized climate change as a key issue amid a crowded portfolio of global crises, told the gathering of ministers that they have a "catalytic role to play" to shape a new financial model that promotes sustainable development and climate resilience.

Ban called on finance ministers and private investors to hold a meeting in the coming months that "could pave the way for a common approach" and make low-carbon investments more attractive to institutional investors.

On Sept. 23, he will host a summit at the U.N. headquarters in New York for heads of state, high-level ministers and business and NGO leaders to address measures to catalyze action on climate change.

The meeting is aimed at ensuring a successful outcome from pivotal UN climate change treaty negotiations in Paris in 2015.

Ban said he wants ministers to come up with ideas before the September summit for capitalizing a U.N.-proposed Green Climate Fund that aims to raise $100 billion to help the world's poorest countries combat and adapt to the impacts of climate change by 2020.

(Reporting By Valerie Volcovici; Editing by Sandra Maler)

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