KARACHI: Caretaker Finance Minister Dr Shamshad Akhtar said on Wednesday Pakistan is facing a trade-off between raising climate finance and development finance. \u201cI think we need to be conscious that getting money is a big issue that we face in addressing the climate agenda,\u201d she said, noting that seeking money for climate finance undercuts other development finance requirements. Speaking at the second Pakistan Climate Conference organised by the Overseas Investors Chamber of Commerce and Industry (OICCI), Dr Akhtar said the best recourse for Pakistan will be to use its \u201cbest of the best firms\u201d to attract institutional investors\u2019 financing for bridging a \u201csubstantial\u201d gap. The country needs an estimated investment of $340 billion to address climate and development challenges between 2023 and 2030. The amount is equivalent to 10 per cent of the cumulative GDP during the same period, even though the country is responsible for less than 1pc of the world\u2019s planet-warming gases. The total cost of implementing Pakistan\u2019s nationally determined contribution (NDC) \u2014 which is a self-defined national climate pledge under the Paris Agreement reflecting what Islamabad will do to help meet the global climate goals \u2014 is projected to be nearly $200bn by 2030. Currently, only $39bn in public finance and $9bn through public-private partnerships is expected for both climate mitigation and adaptation efforts over the coming decade, she said. Pakistan has carried out a few green finance initiatives such as the dollar-denominated green Eurobonds annou\u00adnced by the Water and Power Development Authority (Wapda). WEB DESK<\/p>\n
\u201cWe could\u2019ve done another one, but given the issues surrounding the sovereign, I think we\u2019d have to pay a very high cost for an international bond issuance,\u201d she said.<\/p>\n
\u201cSo I have, on behalf of the government, made a decision not to go for that,\u201d she said, noting that she\u2019d prefer raising funding from the platform of the Pakistan Stock Exchange (PSX).<\/p>\n
The government is planning to float \u201csome of government securities\u201d and different instruments, including Islamic finance and green finance issues, through the PSX.<\/p>\n
Legal amendments have already been made, she said, and the cabinet has ratified the changes approved by the Economic Coordination Committee. \u201cIf we can remain on course, which is always a challenge given what\u2019s going on within Pakistan, we should be able to bring at least one issue of Sukuk,\u201d she said, adding that the issue will have a \u201cgreen element\u201d to it.<\/p>\n
Dr Akhtar noted that climate vulnerability and sovereign debt constitute \u201ca very important element\u201d in the dialogue taking place within the international financial architecture.<\/p>\n
Pakistan has been classified as one of the countries vulnerable to climate change. At the same time, it is classified as a debt-distressed country because its marginal cost of borrowing is at a \u201cvery high rate\u201d with almost 75pc of revenues being used for paying for loans and interest.<\/p>\n
\u201cDespite global sovereign roundtables to look at the resolution of the debt crisis, there hasn\u2019t been a major breakthrough, except for the countries that have declared debt defaults. But it has its own consequences and complications and, as you know, that freezes the inflows,\u201d she said, adding emphatically that a default was \u201cnot an option\u201d for Pakistan.<\/p>\n","protected":false},"excerpt":{"rendered":"
KARACHI: Caretaker Finance Minister Dr Shamshad Akhtar said on Wednesday Pakistan is facing a trade-off between raising climate finance and development finance. \u201cI think we need to be conscious that getting money is a big issue that we face in addressing the climate agenda,\u201d she said, noting that seeking money for climate finance undercuts other […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":{"0":"post-365658","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-business"},"yoast_head":"\n