The world's top 20 economies, collectively known as the G20, need to adopt ambitious sustainable industrial strategies and financial policies to limit global warming to 1.5 degrees C above preindustrial levels, finds a new international report co-led by a UCL researcher.
Commissioned by the government of Brazil as part of its presidency of the G20, the report provides independent recommendations to the G20 Task Force on a Global Mobilization against Climate Change (TF-CLIMA). It recommends that each country develop economic and financial policies to limit carbon emissions to established Nationally Determined Contribution targets (NDCs), as well as new approaches to global governance that prioritise fair and equitable economic growth.
Co-chair, Professor Mariana Mazzucato (UCL Institute for Innovation and Public Purpose) said: "The goal of limiting global warming to 1.5 degrees C above pre-industrial levels requires urgent action from the G20 to set a new direction for growth. G20 countries should advance ambitious green industrial strategies aligned with their NDCs and work to redirect finance - including the immense resources in multilateral and national development banks - to ensure that all countries have the fiscal space to act."
According to the report, an industrial strategy aligned with NDC targets should be the central plank of countries' plans as they transition into a more sustainable economy. These industrial strategies should coordinate across all levels of government, public and private sectors to ensure effective climate action and provide states with the ability to employ green finance strategically.
The report adds that while the design of each of these strategies will be specific to each country, they should reflect bold climate goals or "missions," drawn from NDCs, to encourage investment, innovation and transformation, as well as engagement at all levels of government and across civil society.
Additional recommendations for the nations of the G20 include having governments and businesses work together to tackle climate change, exploring new global governance structures for developing green industrial strategies, committing to clean technologies, and the mobilisation of a range of development banks and other financial institutions to finance the transition to clean technology.
Co-chair Dr Vera Songwe, Founder of the Liquidity and Sustainability Facility, said: "Climate-aligned investments will deliver the growth and prosperity story of the 21st century. Financing these investments will require long term, low cost, public and private capital as well as innovative financing structures to respond to the needs of countries and demands of the private sector. It is within the G20's purview to implement policies, including through prudential regulations, that provide the necessary financing to achieve this goal. Our planet is under attack. The G20 can implement policies and deliver finance that provide reverse this trend."
Titled "A Green and Just Planet: The 1.5°C Agenda for Governing Global Industrial and Financial Policies in the G20," the report was prepared by twelve experts invited by the Brazilian Government, who met throughout 2024 to develop recommendations on aligning economic and financial policies with climate action. It is launching ahead of the next UN Climate Change Conference in Baku (COP29) and the G20 Leaders' Summit in Rio de Janeiro.
