A new paper from Debt Justice and Climate Action Network International discusses the importance of debt justice for climate justice. Based on the shocking projection that the climate crisis will burden sub-Saharan Africa with enormous additional debt, the publication gives recommendations how to address the link between the debt and climate crisis appropriately.
To adapt to more frequent extreme climate events, sub-Saharan African countries will need to take on an additional $1 trillion in debt over the next 10 years, a 50% increase in current debt to GDP ratios. This is particularly striking given that these countries have done the least to create the climate crisis. The paper highlights this climate justice aspect and recognizes the debt owed by rich, polluting nations to the Global South for their role in causing the climate crisis. The Global North and key institutions such as the International Monetary Fund and the World Bank are urged to provide debt cancellation and climate finance. The allocation of climate finance from the Global North to the Global South is at the core of of the international cooperation framework for climate action under the UNFCCC and its Paris Agreement. COP27 provides an important opportunity to address the climate and debt crisis.
Appropriate action by the Global North should include:
- Provide debt cancellation for all Global South countries that need it across all creditors to free up resources for climate action and insure that countries are not trapped in extractive sectors.
- Cancel debt when extreme climate events strike to free up resources for emergency response and reconstruction.
- Provide significantly more and better climate finance and establish a new climate finance goal as part of the New Collective Quantified Goal and a Loss and Damage Facility.