What is Climate Finance? (How it Works?) #Finance

do you know that each year natural disasters such as the droughts earthquakes floods etc cost the world an unbelievable figure of around 640 billion dollars this is almost twice the total gdp of somalia now have you ever thought that from where on the earth does all this money come from

does it come from a public or a private institution or wealthy individuals or is there an organized system that consistently churns out these massive sums of money each year well this is what we are going to find out today hi guys i am dhiraj and welcome to wall street mojo and today we are going

to take you on a ride of climate Finance so keep your seat belts on we all know that climate change is a global issue and it takes huge amount of money to mitigate its impact

we also know that not every country can afford this huge amount of money right especially the ones which are developing or the underdeveloped nations now this is where climate none;">Finance comes into play so in a broader sense climate Finance generally means that any type of financing that is used to tackle climate change however

let’s suppose if you have to be specific in that case climate Finance refers to the money that is provided by the developed countries to the developing economies in

order to help them fight this problem of climate change such as that of the greenhouse gas emissions and at the same time help them develop and invest in economic friendly technologies and resources such as the wind and the solar power you can consider it as a weapon that the individuals and the

nations use to fight this menace of climate change so the next question that naturally comes to our mind is where does all the Finance come from so typically the money

involved in climate Finance comes from the developed countries that use private and public players such as the central banks big corporations and enterprises to allocate

funds now a key milestone for climate Finance was the copenhagen agreement which was reached in 2009 so in this agreement the developed countries pledged an impressive 10

billion dollars per year until 2020 for these developing countries and the good thing is that all this money was to be used by developing countries to lessen the effect of climate change on their economies now you would be thinking what’s the point of all this i mean who benefits from this

tons and tons of money the key idea or the objective behind climate Finance is to help developing countries move towards those green energy sources and technologies that have

lower carbon emissions and at the same time you know prepare them to financially deal with the adverse impacts of climate changes such as that of the flood or droughts etc yes it’s kind of a win-win situation for developing countries and to support this fact we have got some numbers for you

in the year of 2015 and 2016 japan was the largest donor when it came to climate Finance you know giving around 10.3 billion per year on an average over the two-year period

and at the same time india was a major beneficiary when it came to receiving funds at a whopping you know 2.6 billion per year it was followed by bangladesh vietnam the philippines and thailand and that’s not it in fact in recent times the topic of climate

href="https://cashnews.co/finance" style="font-weight: bold; color: #1a73e8; text-decoration: none;">Finance has taken global importance why do i say so because you know according to the data from united nations economic program or the univ global Investments in the

field of renewable energy and technologies have sold up a whopping 2.5 trillion between 2010 and 2019. now guys you must understand that these trillions of dollars don’t suddenly jump out of nowhere in fact there’s a system in place that helps to churn out huge

href="https://cashnews.co/finance" style="font-weight: bold; color: #1a73e8; text-decoration: none;">Finances for fighting climate change and developing climate change infrastructure so what are they let’s have a look the first in line are the bags who play a huge role in

transferring Capital overseas secondly we have the financial market such as that of the stock Markets and the Real Estate market that set up the price of the

energy commodities and finally we have the Stock Exchanges that serve as a tool for investment in renewable energy companies such as that of azure power and ascent solar companies now besides these traditional options that we just discussed there are certain instruments that do

play a vital role in helping climate Finance and these include the following green Bonds this is a kind of a dead bond issued by public of private

institutions basically for environmental purposes such as that of fighting climate change then the next comes is the concessional laws it’s a kind of an easy Loan given for carrying out you know climate control activities and they have a longer repayment period and lesser

Interest Rates and finally comes the grants and donations to fight climate emergencies so you see it’s a very organized mechanism and now if for some reason let’s say you still feel that climate color: #1a73e8; text-decoration: none;">Finance is just a wastage of money and carries no significant impact then let me tell you that climate change can have a serious impact on world economics some of which include the following the first is decrease in global gdp by 18 if the global

temperature raises by 3.2 another one is the loss of trillions of dollars from the coastal economies if the global sea level rises seems like the world needs a collective health doesn’t it and that’s why guys the role of climate

style="font-weight: bold; color: #1a73e8; text-decoration: none;">Finance becomes all that more crucial climate Finance provide countries across the world the

necessary financial resources to fight the harmful effects of climate change through activities such as purification of pollutants that exist on land air or water another thing is that reducing the use of fossil fuels also you know curbing harmful emissions such as that of greenhouse gases however

as optimistic as it may sound climate Finance is a costly affair experts feel that a whopping 100 billion dollars is required each year to fund these climate

Investments and it’s fair to say that most of the countries cannot afford that luxury and this means that all this financial burden actually fall on the shoulders of developed countries such as that of the us and japan however even with some of its loopholes one thing is for

sure that climate Finance is real and is here to stay and if you think otherwise then let’s take a real-life scenario where climate

href="https://cashnews.co/finance" style="font-weight: bold; color: #1a73e8; text-decoration: none;">Finance is in action so guys you must have heard that developed countries such as north america and europe have often issued statements that they want developing nations to reduce their

dependency on coal-based power plants for energy generations right yes it’s a typical godfather-like bullying tactics of developed nations however developing countries might argue that these developed countries achieved their own energy generation goals by exploiting coal and other natural

resources during their industrialization and that is where it would be the moral duty of developed countries to help the developing economies invest in more eco-friendly energy sources now this is how you know climate #1a73e8; text-decoration: none;">Finance works and i hope you know you’ll get it now and with this guys you know it’s me theatre signing off for today i hope you liked this CashNews.co and if you did then do hit the subscribe button and vote us thumbs up and let us know

what you think about climate Finance in the comment section below you