GCAP and 221 civil society groups from 55 countries have sent an open letter calling on world leaders to transform international public finance to tackle climate change and deliver a just energy transition.

The letter, signed by the GCAP, Bretton Woods Project, Oil Change International, Debt Justice, Power Shift Africa, Asian Peoples’ Movement on Debt and Development, and Climate Action Network International, urges heads of state to use COP28 to overhaul global monetary, trade, tax, and debt rules, as well as international financial institutions like the World Bank and International Monetary Fund (IMF).

Released ahead of COP28’s Finance Day on 4 December, when major public finance announcements are expected, the letter warns the current global financial architecture is perpetuating fossil fuel production, locking climate-vulnerable countries into debt, and delaying a just energy transition.

When it comes to funding a just transition to 100% renewable energy systems, the gap between what climate-vulnerable countries have and what they need is vast. Phasing out fossil fuels and scaling up renewable in developing countries will cost an estimated $1.7 trillion a year, and rich countries’ ‘fair share’ of all climate costs in the Global South is calculated at almost $6 trillion a year. Both estimates dwarf the $100 billion a year in climate finance long promised by high-income countries to low-income ones.

The letter states that public money should be used to fund proven climate solutions and prioritise community-led renewable energy, rather than fossil fuels; development banks should be more accountable and democratic; and large scale debt cancellation must be secured.

Finance-related discussions on the table at COP28 include: new pledges to the Loss and Damage fund; sessions on Climate Resilient Debt Clauses, IMF Special Drawing Rights and innovation; and the launch of a new taxation taskforce, led by France and Kenya. Barbados, Kenya and Colombia are among the countries calling for financial system reform.

Read the Letter Here.