World Bank urges Gov’t to invest 3% of GDP in climate resilient actions
The World Bank has urged the Government of Ghana (GoG) to invest over $2bn (2-3% of GDP) into Climate Resilient and Low Carbon Development (CRLD) pathways to foster a more green, resilient and inclusive economic growth.
According to the Bretton Wood Institution, the $2bn annual investment into climate resilient actions have clear economic benefits that will more than compensate for their costs, as damages from climate change to the country are expected to become much larger post 2050.
In its new climate change report titled Ghana Country Climate and Development Report (CCDR), the World Bank asserts that failure by government to invest in climate resilient actions will push an additional one million Ghanaians into poverty.
Additionally, agricultural productivity and yields will be heavily impacted.
However, early and prompt investments into climate resilient actions by government will result in a 4% increase in the country’s GDP by 2040.
On mobilising funds to invest and finance climate resilient actions, the World Bank averred government can encourage the private sector to fill the finance gap that may exist in the medium to long term.
“Financing climate resilient actions from the national budget will be challenging even over the medium to long term, as such, there is a clear role for both development assistance and private finance to fill the gap.
“Ghana can encourage private sector led-green growth by promoting a sustainable investment climate and creating opportunities in selected sectors for private investments such as energy efficiency improvements, CSA technologies and electric vehicles,” stated the report.
“The role of the financial sector will also be key to leverage opportunities for green and blue bonds, insurance and other financial protection mechanisms that can help address climate and disaster risks,” it added.
The CCDR by the World Bank focuses on six priority areas in which government can invest in to ensure a green, climate resilient and inclusive economic development.
The CCDR recommends actions to be taken in the immediate term considering binding financing constraints, short to medium-term when larger investments can be made in building climate resilience in the economy and society, and over the long-term where it may become more feasible to pursue more aggressive decarbonisation.
