How can good practice from the COVID-19 response inform climate action?

The world has already seen that some responses to COVID-19 have been more effective than others. What are the lessons for making development finance more effective, and how can the World Bank apply them? We share some key take-aways.

COVID-19 and the associated economic downturn are currently the number one and two priorities for governments and international institutions. The urgent need to respond to the pandemic and resultant economic impact is likely to be the focus of public policy and international development in both the immediate term, and for some time to come.

As people the world over do their best to prevent the spread of the virus, it can be useful to think about the lessons the pandemic has for us, and for other (and interconnected) global challenges that humanity will continue to face once this threat is under control. A prime example: climate change. Despite a temporary slowdown of economic activity and accompanying reduction in greenhouse gas emissions, the climate emergency is not going away.  What lessons do we have about how science can inform responses to both a global pandemic, and the continuing real climate emergency?

Policy decisions should be based on science rather than politics. Policy makers who listened to medical professionals about the transmissibility of COVID-19 took timely and decisive action to limit its spread. Similarly, policy makers who follow the recommendations of climate scientists have advanced low-carbon, resilient options that will help bend down the emissions curve and limit climate impacts. 

Early action (prevention & preparation) is critical. Countries that have responded quickly to the coronavirus have already seen new cases peak and begin to decline. On the flip side, governments that failed to take early action are seeing devastating consequences. For climate change, the sooner countries and institutions act to achieve carbon neutrality, the smoother that transformation will be. 

Collective global action is crucial. The virus doesn’t respect national borders. Neither does climate change. For both crises, we need to work together, and we need global leadership and institutions to help us do that effectively. 

Prioritizing marginalized groups protects us all. Preventing the spread of the pandemic through social distancing and surging medical capacity is absolutely needed to avoid an unmanageable spike in potentially fatal illness and to flatten the curve. This is especially important for marginalized groups that will be disproportionately impacted by COVID-19. As for the pandemic, so too for climate:  No region is immune, so working to help those in most vulnerable to COVID-19 will help all of us to mitigate and prepare for global climate change, that like the virus, will have growing impacts for a time, even after mitigation actions.

What Does this Mean for the World Bank?

Science to action? The World Bank prides itself on being a “Knowledge Bank.” That is welcome and needed. The question is: is knowledge translated into action? The World Bank is clearly taking swift action to address the pandemic. In the space of two weeks, the Bank approved a $14 billion increase in lending, starting with approved projects in 25 countries under the Fast-Track Facility.

When it comes to climate, there has been much less action. The Bank has produced flagship reports, such as Turn Down the Heat and Convenient Solutions to an Inconvenient Truth. But follow-up has been mixed. A key tool the Bank has for turning knowledge to action is through its development policy finance (DPF).  Our review of Bank climate finance found that DPF is rarely used for climate action, or if included, climate goals may be subsumed in larger initiatives that also serve contrary goals in the name of efficiency.

Where’s the climate crisis response? The World Bank has responded swiftly to the pandemic with targeted loans to address immediate health needs, and this aligns with the “early action” principle noted above.  It has also announced plans to deploy up to $160 billion over the next 15 months to support COVID-19 measures that will help countries respond to immediate health consequences of the pandemic and bolster economic recovery.  The $160 billion compares to $45 billion in approvals in FY19, and demonstrates its potential for response to crisis...

Sadly, while the Bank acknowledges that climate change is a fundamental threat[1] to sustainable development and the fight against poverty, with urgent action needed over the next decade to change the trajectory, there has been no $160 billion emergency funding in response.  WB Group climate finance peaked at $21.3 billion in FY18[2], slid back to $17.8 billion in FY19, and in no prior year exceeded $13 billion. Is that a crisis response, or business-as-usual?

Mainstreaming climate: Of course, it matters greatly how effectively these funds are applied.  The Bank has already acknowledged that for a sustainable recovery from COVID-19,  “we do not need to start from scratch: we can use projects already identified in [countries’] climate change adaptation plans and the Nationally Determined Contributions (NDCs) of the Paris Agreement.” Both health and climate benefit from deployment of clean cook stoves and distributed renewable energy.  A corollary is that fuels that provide energy, but harm health and disrupt the climate, make little sense.  Initiatives across sectors should reinforce each other, or at a minimum, not do harm in other sectors. That is one reason that environmental and social safeguards remain important, across all sectors. 

Pursue collective & coordinated action: Going forward, as the Bank works to roll out COVID response projects, effectiveness will require coordination— certainly coordination with the IMF will be critical to address macroeconomic needs.  Similarly, the Bank needs to coordinate with regional multilateral banks and bilateral donors, along with the borrowing governments.  This is equally true for work on climate, a multi-layered problem that requires local, national, and transboundary action, across different sectors, from energy to agriculture to forests. Here, the Bank has extensive experience in managing multiple climate-related trust funds such as the Climate Investment Funds, implemented together with the regional MDBs. The CIF developed the first-ever MDB facility to provide Indigenous Peoples direct access to climate finance. These programs have benefitted from strong stakeholder engagement, which has resulted in more rigorous safeguards, fuller disclosure, better tracking methodology, and more attention to benefit sharing.  Such work needs to be built on, improved, then replicated and scaled. The new Bank-managed ProGreen program is an opportunity to do this, but requires additional funding and/or partners.

Protect marginalized groups: The final lesson, on protecting marginalized groups, applies especially to the World Bank, since its mission is to lift people out of poverty and boost shared prosperity. While most of the countries receiving early COVID response financing are borrowers from IDA, which finances low-income countries, it is critical that this be targeted to actually address the specific needs of marginalized groups, including indigenous peoples and afro-descendants.  And actions that support resilience to the pandemic can also protect marginalized groups from climate impacts, which remains a growing and unmet challenge.  The World Bank has promised to devote 50% of its future climate finance to adaptation—measures to reduce vulnerability—and this is welcome.  Yet it will fall well short of the needs.

Clearly, the Bank has many of the tools needed to help countries respond both to COVID-19 and to climate change.  Applying science, leveraging partnerships, considering the crisis across all sectors, bringing efforts to scale, and remembering always to prioritize marginalized groups are principles that it can use to guide its work in response both to COVID and climate change.

Will it do so?  That remains to be seen. We’ll share more ideas on how it can do so in a forthcoming update.  

The virus doesn’t respect national borders. Neither does climate change. For both crises, we need to work together, and we need global leadership and institutions to help us do that effectively.