An ILO analysis showed how the International Monetary Fund and multilateral development banks could triple external flows related to official development assistance for the poorest countries in the upcoming years, and thus combat the growing disparity with the richest countries.
It also referred that such funds would also facilitate to address one of the biggest and most immediate obstacles to achieving the goals of the Paris Agreement: the burning of coal.
The document indicates that all nations have an interest in accelerating the implementation of globally agreed strategies for addressing the current crisis, including the World Health Organization’s COVAX initiative, a collaborative mechanism for equitable access to Covid-19 vaccines.
In addition, the ILO’s Global Call to Action for People-Centered Recovery from the pandemic, and the 2030 Agenda, which includes the Paris Climate Agreement and the Sustainable Development Goals (SDGs).
The ILO proposed among the actions to achieve those goals to fully and rapidly finance the COVAX Initiative, provide debt relief and restructuring, invest in social protection floors and sustainable, job-rich, SDG-related infrastructure and industries.
The organization also suggested allocating funds to a global effort to avoid lock-in of greenhouse gas emissions from coal-fired power, which represents the most important issue of the climate action and just transition required to achieve the 2015 Paris Agreement.
ILO’s Research Director Richard Samans noted that the fuller utilization of financial institutions will enable the world to move from steady, incremental progress to truly transformative progress in fighting against the effects of Covid-19 and climate change.
Such a goal will be possible without relying on large increases in bilateral foreign aid budgets.
It also recommends the growth of external flows for Official Development Assistance over the next seven years by two trillion dollars for the 82 poorest countries, the equivalent of about four percent of their Gross Domestic Product.