New UK support to power green growth at home while tackling climate change abroad
Senior Cabinet ministers meet City of London leaders as Foreign Secretary announces new climate support
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Foreign Secretary announces new funding to make it easier for countries to access UK private sector climate finance and disaster risk insurance, driving UK green growth.
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Support comes as senior Cabinet ministers meet City of London leaders to discuss UK financial sector’s role in boosting sustainable finance for emerging markets and developing economies.
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David Lammy to set out the economic opportunity for the UK and the City of London, in line with the government’s Plan for Change—with emerging markets expected to drive 65% of global growth by 2035.
New support will help millions of people globally deal with the daily impact of climate change, the Foreign Secretary David Lammy has today announced (Tuesday 8 July).
A £12m commitment for disaster relief finance and insurance will help climate-vulnerable countries better prepare for the impact of disasters like hurricanes and drought.
This funding is triggered by certain warning signs—such as a weather event or forecast—to enable faster payouts and a more effective response.
Backed by the UK financial sector, this will also help drive domestic green growth and unlock jobs, opportunity and security for people in the UK.
This new funding comes as Cabinet Ministers from the Treasury, Foreign Office, DESNZ and DEFRA will today meet leaders from the financial sector. They will collectively discuss how to champion UK-based investors and financial institutions to channel investment into climate initiatives in emerging markets.
Foreign Secretary David Lammy said:
The climate and nature crisis is the greatest global challenge we face. Failure to act will cause unprecedented environmental damage, fuelling displacement, conflict and famine.
Tackling this crisis is also a huge opportunity for people and businesses here in the UK, delivering on our Plan for Change. The green sector is worth trillions of pounds, and I’m determined that we seize the economic growth, jobs and security it offers.
The City of London, the world’s leading sustainable development financing hub, has a crucial role to play in this.
Today’s measures, in support of the UK government’s Plan for Change, will help unlock sustainable finance from the UK and elsewhere, and ensure developing countries can better manage climate shocks themselves.
This effort will help foster sustainable growth and protect the most climate vulnerable nations. Global climate investment is increasing rapidly, hitting $2.1 trillion last year, and the government sees the City of London in a prime position to capitalise on this opportunity.
Last year the UK’s green sector grew three times faster than the economy as a whole, attracting £43bn of private investment. With London ranked as the world’s top sustainable finance centre, the UK is uniquely positioned to grow this industry further by helping to unlock finance for emerging markets that will drive 65% of global growth by 2035.
The £12 million for pre-arranged finance will cut the cost of responding to disasters and accelerate the time it takes them to recover from such shocks.
This follows the UK launching a global coalition with its partners last week, to scale up pre-arranged finance tenfold by 2035, alongside a coalition to drive greater investment for developing economies through public markets. This was announced by the Minister for Development Baroness Chapman at the 4th International Conference on Financing for Development in Sevilla, Spain.
The Foreign Secretary is also today announcing that the UK’s Financial Services Centre of Expertise will help financial regulators across ASEAN access expertise from the Financial Conduct Authority. The initiative will focus on regulatory alignment across ASEAN markets to deliver green growth opportunities for UK investors.
BACKGROUND:
- It’s the first time multiple cabinet ministers will be attending a meeting with leaders from the City of London together, signalling a growth opportunity on climate action.
- The UK will be first country to annually publish pre-arranged finance as a percentage of overall crisis finance spending, with the aspiration of increasing this over time.