V20 Focus Group Meetings III in Addis Ababa, August 2018

Addis Ababa, 27 August, 2018: Finance Ministers of the ‘Vulnerable Twenty’ (V20) representing one billion people from 49 countries around the globe, held their annual Troika Plus meeting on Monday, August 27th 2018, in Addis Ababa, Ethiopia. Now led by the Marshall Islands, the V20 was created to share and scale up innovative approaches to climate finance developed by those countries most affected by climate change, including low and middle income, least developed, arid, isthmus, landlocked, mountainous and small island developing countries from Africa, Asia, the Caribbean, Latin America and the Pacific.

This V20 meeting represented a further reaction to the increasing sense of urgency regarding global climate actions. In terms of climate risk insurance, a V20 Study in 2016 indicated that just 14 per cent of the one-billion population of V20 members had access to existing catastrophe risk mechanisms, which corresponds to protection for less than 10 per cent of the GDP of V20 member economies.  It is clear that the V20 need to close both, the insurance protection gap as well as the disaster risk reduction gap, and the countries present in Addis discussed options to do so, including continuing the development of the V20-led Sustainable Insurance Facility (SIF) as well as strengthening its engagement with the InsuResilience Global Partnership through increasing and promoting proactive V20 country membership.

Moreover, the V20 supports the Climate Vulnerable Forum’s (CVF) adopted ambitious climate mitigation and energy resilience objective of striving to achieve 100% renewable energy production by 2030-2050. Renewable energy technologies now rank among the least cost solutions in the power sector – increasing renewable energy production across V20 countries could therefore spur substantial growth and development across the member economies. At the same time, the V20 countries present in Ethiopia also highlighted the need to continue the work on climate accounting to reduce the risk of stranded assets across their economies as a result of previous and ongoing investments in carbon intensive energy infrastructure. In response to this, the V20 reaffirmed its commitment to coming up with financing mechanisms, including accelerated private financing for 100% Renewables and Maximal Resilience.

Vulnerable countries deserve not only to survive, but thrive. Insurance and climate-related investments are often only linked to ‘survival’, yet to ensure vulnerable economies also ‘thrive’, insurance and climate-related investments have to be adapted to match current and future challenges. In reference to the challenges outlined above, innovative financing and insurance are needed to close the protection gap arising from slow and sudden onset events.

To drive forward these processes, the V20 countries in Addis therefore plan to expand the dialogue with the G20 on insurance solutions and 100 per cent renewable energy trajectories in international and regional meetings in the near future.

Link to V20 press release:

https://www.v-20.org/v20-meetings-at-addis-ababa/

·     https://www.v-20.org/marshall-islands-new-v20-chair/