Climate change mention in G20 communique

Andrea Shalal and Michael Nienaber
The US has continued to block climate change being listed by the G20 as a major economic risk.
The US has continued to block climate change being listed by the G20 as a major economic risk. Credit: EPA

Finance officials from the world's 20 biggest economies have referenced climate change in their final communique, for the first time since US President Donald Trump came to office.

However they stopped short of calling it a major risk to the economy,

The US blocked including climate change on a list of downside risks to global growth, that had won agreement by nearly all other G20 delegates.

Ultimately the only mention was in relation to the Financial Stability Board's work examining the implications of climate change for financial stability.

US Treasury Secretary Steven Mnuchin played down the importance of the language, calling it a "purely factual" reference to work being done by the FSB. But several G20 sources said it marked progress toward greater recognition of the economic risks posed by climate change.

"I did not bend to pressure from the Europeans," Mnuchin told reporters after the release of the communique, bristling at the characterisation of one reporter.

Saudi Finance Minister Mohammed al-Jadaan, hosting the meeting in Riyadh, told reporters that climate change remained a very important issue on the Saudi G20 presidency agenda and that there had been discussions related to "financial risks at large" linked to the issue.

Discussions related to "climate change and environmental protection" would continue at ministerial meetings and in technical groups throughout the year, he said.

US officials have resisted naming climate change as an economic risk since Trump took office in 2017. One of his first acts as president was to announce Washington's withdrawal from the Paris climate accord.

G20 finance ministers and central bankers met in the Saudi capital on Saturday and Sunday to discuss top global economic challenges, including the spread of coronavirus.

Concerns about the economic impact of climate change have escalated in recent years and pressure is mounting on business to accelerate the shift to a low-carbon economy ahead of United Nations climate talks in November.

A report issued last week forecast the world's financial services sector risks losses of up to $1 trillion if it fails to respond quickly to climate change and is hit by policy shifts such as the introduction of a carbon tax.

The International Monetary Fund included climate-related disasters in a list of risks that could derail a "highly fragile" projected recovery in the global economy in 2020.

It estimated that a typical climate-related natural disaster reduced growth by an average of 0.4 percentage points in the affected country the year it occurred.