Global South countries rally around Bridgetown 3.0
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Dr. Pep Bardouille speaking at Axios House/UNGA and Climate Week. Photo: Sam Popp on behalf of Axios
Barbados on Wednesday released the third draft of its ambitious multilateral overhaul that would free up more money at lower borrowing costs for developing countries in climate crises.
Why it matters: The Bridgetown Initiative, released at this week's UN General Assembly, has brought together many Global South countries that seek to bridge the financial gap — estimated in the trillions — in climate financing for the region.
- Its central message is to make it cheaper for emerging and developing countries to borrow to build climate-resilient economies.
Driving the news: Bridgetown 3.0, named for Barbados' capital city, has three major prongs.
- Changing the rules of the game. Today's financial structure of multinational banks like the IMF was conceived more than 50 years ago.
- Shock-proofing economies. Creating more access to special drawing rights (SDRs), and other sources of liquidity for the Global South.
- Increasing financing and making good on existing commitments. "Many, many commitments have been made over the years, and we're not necessarily sticking to them," Bridgetown's executive director, Dr. Pep Bardouille, said earlier this week at Axios House ahead of its formal release.
What they're saying: "I think what it takes is a mindset shift, which is not that we're giving you money that we don't have and we're taking away from here to give to there," Bardouille said. "It is fundamentally, a recognition that your lives matter as much as our lives. And this is actually good business sense."
By the numbers: The Bridgetown Initiative estimates that every dollar invested in climate adaptation saves between $4 and $7 later.
- More than half of the world's population currently lives in a country which pays more in debt service each year than it does on education, health or climate adaptation policies.
- The annual estimated financial need for countries to address the climate crisis is about $1.8 trillion a year for investments in the Global South.
- In 2022, world's wealthiest economies provided and mobilized a record $116 billion for climate finance for developing countries, 40% of which came from multilateral development banks (MDBs)
What's next: Climate finance is atop the agenda for November's COP 29 in Baku, Azerbaijan.
