Speed dating, but for international climate investments. That’s one pitch that is set to be approved at Cop27 climate talks in Sharm el-Sheikh, Egypt.
Negotiators have provisionally agreed to hold regular “investment-focused events” as part of a process to cut emissions, known as the mitigation work programme.
The aim, according to the latest draft text, is “unlocking financing barriers and identifying investment opportunities and actionable solutions” to help investors fund emissions-cutting projects.
In a written proposal, the UK government described the events as “world cafe[s]” with a “speed networking” element between governments and investors to “enhance investment and international partnerships”.
The events would be run by UN Climate Change with the support of “high-level champions” – a now-annual appointment by each Cop presidency to bridge the divide between formal talks and the private sector.
The champions tested out the concept in 2022, with a series of regional forums. It culminated in an event at Cop27 to showcase 50 projects looking for $90bn alongside a longer list which included 78 more. Together, they’re worth $120bn.
“We can now show that a meaningful pipeline of investible opportunities does exist across the economies that need finance most,” said Egypt’s climate champion Mahmoud Mohieldin.
A source with knowledge of the situation told Climate Home the champions whittled the lists down from 450 projects, which meant disappointing a lot of developers.
The shorter list is tilted slightly to middle-income countries. Projects that didn’t make the cut include drainage channels in Nigeria, to help cope with flooding, and a clean cooking programme in Ghana.
Investors told Climate Home that a lack of connections was not the main obstacle to sourcing finance for emissions-cutting projects in developing countries.
Julie Levin spent four years as an investment analyst at the McConnell Foundation, before joining Environmental Defence Canada’s finance team.
She told Climate Home she was sceptical that any deals would be done as a result of these events which wouldn’t have been done anyway. “I don’t imagine it will be significantly impactful in addressing the lack of investment in the global south,” she said.
Levin said that investors had a “prejudice” against newer technologies and against lower income countries.
Money is flowing into oil and gas in Africa, she noted. Holding banks to their net zero pledges, as the UN is trying to do, would move this money into greener projects.
Sonam Velani used to work at the World Bank and Goldman Sachs before founding her own social impact fund Streetlife. She said that these investment events would only be a “very, very small step forward” as investors like her are already bombarded with pitches on Twitter and LinkedIn.
Most venture capitalists are very public, she said, and even in countries with low levels of internet access, entrepreneurs looking for funding are able to connect.
“The gap is not in finding something, it’s making someone feel more comfortable with an investment,” she said.
Velani said multilateral development banks were able to take more risks but they have too much red tape. Governments should “lay out the red carpet not red tape” to investors, she said.
“Even though the pipeline of interesting projects is there, they will require technical and financial help to get to a position where they can attract the right kind of finance,” Nigel Topping, UK champion from last year’s Cop26 summit, acknowledged. “We need all actors in the system to roll up their sleeves to make that happen.”
This proposal is part of the mitigation work programme. Countries agreed at Cop26 to launch this to discuss how to close the gap between collective national emissions cuts and the global temperature limit goal of 1.5C. Negotiators are supposed to finalise the details at Cop27.
While holding investment events is uncontroversial, Evans said, discussions have been “lively” on how to structure the broader process.
An alliance of developed countries, vulnerable small islands and some left-wing Latin American countries wants the forum to continue all the way to 2030 and report back to politicians and Cop meetings regularly.
Big emerging economies including China and India want discussions to only last a year or two and not to feed in to ministerial or Cop discussions.
Another divide is over how specific to get in sectoral discussions.
The Cop27 presidency has put the climate ministers of Denmark and South Africa – Dan Jørgensen and Barbara Creecy – in charge of hammering out a deal by the weekend.