Pakistan, along with six other states, will be the first recipient of Global Shield against Climate Risks funding launched by the G7 countries at the COP27 summit in Egypt. The initiative seeks to provide financial assistance to the ‘pathfinder countries’ suffering from climate adversities.
Bangladesh, Philippines, Costa Rica, Fiji, Senegal and Ghana, are the other enlisted countries that will be receiving the Global Shield funding, according to a statement issued by Germany on Monday.
“This is a path-breaking effort,” said Ghana’s Finance Minister Ken Ofori-Atta and the Vulnerable 20 Chair, hoping the initiative will benefit the pre-existing structures whose performance is yet to be proven. “Our fiscal space is under constant threat and the inflationary pressures of climate change are closing out our options,” he added.
The Global Shield Initiative
The Global Shield is an initiative based on the provision of pre-arranged financial support that can be quickly deployed in the countries struck with the climate related calamities, for insurance and disaster protection.
The initiative is being developed with the joint collaboration of Group of Seven (G7), the Vulnerable 20 (V20) Group of Finance Ministers of 58 climate vulnerable economies.
The program will be effective immediately after COP27, according to the joint press issued by V20, G7 and the German Ministry of Economic Cooperation and Development.
Contributions to the Global Shield
The initiative seeks to close protection gaps using a broad range of appropriate instruments, including livestock and crop insurance, property insurance and business interruption insurance. Pledges of core funding to the Global Shield from some of the G7 countries include:
- Germany is providing 170 million Euros of seed contribution – 84 million Euros as core funding to the Global Shield and 85.5 million Euros for related climate risk finance instruments.
- Denmark is providing 35 million Danish kroner (about 4.7m Euros)
- Ireland providing 10 million Euros
- Canada providing 7 million US dollars
- France will provide 20 million Euros
- 170 million Euros will be collectively provided by other countries
Further contributions by donors are expected to materialize soon.
