3. The Chequered History of Climate Finance

Because it is the largest and most urgent crisis facing humanity, it is appropriate that climate change—and how to finance our response—has its own chapter in a book on sustainable finance. Here we consider what climate justice can tell us about how the balance of investment should be shared between the countries that have exploited fossil resources to grow rich and those that have fewer resources but are suffering more immediate and more severe impacts from the climate crisis. This, known as ‘the loss-and-damage agenda’ in UN negotiations, has been the source of repeated conflict at the UNFCCC process. The chapter also considers and compares climate investment packages from a range of the world’s largest economies, known variously as Green New Deal or green stimulus. I then explore the link between colonial history and the need for reparations and routes to funding the loss-and-damage agenda. And I conclude by considering more radical proposals for using the credit-creation facilities of the IMF to produce the money to solve the climate crisis.