The vital role of capital markets in tackling climate change has been ignored for too long, Climate Change Minister Greg Barker said this week.
Barker was at the London Stock Exchange to launch the Capital Markets Climate Initiative, which has two targets: to highlight the City of London’s potential to become a global hub for green finance and to stress how low carbon investment can be a huge opportunity for the UK’s financial services industry.
The Department of Energy and Climate Change is bringing together key players from the City with international financiers and policymakers, with the initiative aimed at driving green economic investment in emerging economies and identifying how the current barriers to new investment can be dismantled.
The CMCI aims to help unlock the private sector’s ability to help meet the $100bn of new green investment required annually by 2020 to tackle climate change in developing countries.
Barker said: “The vital role of capital markets in tackling climate change has been overlooked for far too long. The finance needed to help developing countries become low carbon isn’t flowing at the rate and scale needed.
“However, this is a huge opportunity for the UK financial services industry to grab a share of a completely new international market that will be worth billions in the years to come.
“We want the City of London, with its unique expertise in innovative financial products, to lead the world and become the global hub for green growth finance.”
Mayor of London Boris Johnson also launched the initiative. He said: “As the powerhouse of the UK’s economy, it is vital that London remains at the forefront of low carbon advancement. That’s why City Hall has teamed up with others to set up the £100m London Green Fund to provide investment for climate change programmes and to prove their commercial viability. I want to ensure London’s competitiveness as a leading global city and the Capital Markets Climate Initiative is a great opportunity to help us do that.”
The London Green Fund is made up of contributions of £50m from the London European Regional Development Fund Programme, £32m from the LDA and £18m from the London Waste and Recycling Board.