Ghana seeks climate finance access for debt-restructuring countries
Ghana has called for climate-vulnerable countries undergoing debt restructuring to retain access to climate finance, insisting that exclusion could undermine development gains and efforts to achieve debt sustainability.
Minister of State for Climate Change and Sustainability in Ghana, Issifu Seidu, has urged climate-vulnerable nations undergoing debt restructuring to retain their access to climate finance. Seidu argued that excluding these countries from climate finance could hinder their development efforts and debt sustainability. He stressed the importance of timely financing for these economies to respond to climate shocks without diverting resources from development priorities or resorting to emergency borrowing.
This call came during a ministerial dialogue held on the sidelines of the International Monetary Fund (IMF) and World Bank Group (WBG) annual meetings in Bangkok. The dialogue aimed to kickstart the process of establishing a US$500 million Lifeline Fund by the V20 group of climate-vulnerable economies. The proposed fund is designed to offer rapid financial assistance to countries facing climate-related challenges.
Seidu credited Barbados for spearheading the advocacy for reforms in the international climate finance system to better cater to the needs of such countries. He noted that climate shocks often set back development progress, leading governments to allocate their limited resources towards emergency response and recovery. Seidu emphasized that when debt-restructuring countries are excluded from climate finance arrangements following difficult decisions, it creates competing fiscal demands.
These countries must simultaneously fulfill debt-servicing obligations, fund development programs, and address climate-related disasters like floods and droughts. The proposed Lifeline Fund aims to bridge this financing gap by providing quicker access to resources for climate interventions, bypassing the lengthy bureaucratic procedures of traditional climate funds.
Seidu emphasized that excluding debt-restructuring countries from climate finance was counterproductive, particularly when they had undertaken challenging yet necessary actions to restore debt sustainability. He reiterated Ghana's commitment to advocating for structural inequalities at the intersection of climate justice and debt sustainability.
Seidu urged partners to back government efforts to assist vulnerable countries and communities, as well as investors to collaborate in crafting sustainable solutions and sharing resilience-building success stories in the Global South.
Written by urgent.news from MyJoyOnline Ghana's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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