The IMF and Civil Society
Reducing the Impact of Climate Change
December 14, 2007
At the United Nations Climate Change Conference 2007 held in Bali (December 3-14), the IMF announced that it is ready to play its part on the issue of global climate change. IMF Deputy Managing Director Takatoshi Kato offered the conference the Fund’s perspectives on the main economic challenges that are caused by global warming.
Kato described the work that the IMF is currently undertaking on the economics of environmental issues. These comprise, among other things, a study published in the Autumn 2007 World Economic Outlook and new research on the implications of climate change for the global economy. This latest work will be presented in the Spring 2008 issue of the World Economic Outlook.
The IMF is planning to work in conjunction with the World Bank and relevant UN agencies to contribute to the analysis of the macroeconomic implications of climate change and the spillover effects of national policies on greenhouse gas emissions. Additionally, the IMF is offering to provide advice—through its bilateral and multilateral analysis and monitoring, and through its technical assistance—on appropriate fiscal and other macroeconomic policies to mitigate climate change and adapt to its consequences.
The Fund is already active in the design of relevant tax mechanisms and other fiscal measures and is willing to provide financial assistance to member countries in response to a range of macroeconomic disturbances, including natural disasters, through its exogenous shock facility for low-income countries. The Fund is offering to contribute technical knowledge and experience in undertaking macroeconomic, fiscal, and financial analyses given the broad reach of its macroeconomic assessments and expertise in both industrialized and developing countries.
The conference in Bali was aimed at launching two-year negotiations for a new global pact to replace The Kyoto Protocol to the United Nations Framework Convention on Climate Change when it expires in 2012. The summit brought together representatives of over 180 countries, including observers from intergovernmental and nongovernmental organizations, and the media.