On September 27, 2024, Oxford Climate Policy (OCP), the International Peace Institute (IPI), and the Global Solidarity Levies Task Force co-hosted a closed-door roundtable discussion titled 2024: The Turning Point for Innovative Financing and Solidarity Levies? The event brought together thought leaders, negotiators on climate change, and other relevant stakeholders working on innovative finance to discuss the political and economic challenges of implementing new levies to assist developing countries in addressing the impacts of development and climate change.
The event was moderated by Jimena Leiva Roesch, Director, Global Initiatives, IPI, who pointed to growing momentum for solidarity levies, referencing, among others, the launch of the Global Solidarity Levies Task Force at COP28, co-chaired by Barbados, Kenya, and France.
Benito Müller, OCP Managing Director, discussed the possibility of air ticket levies as Climate Solidarity Levies to support climate action, particularly loss and damage. Reflecting on over 20 years of advocacy for an air passenger levy, he expressed concern that without additional revenue from innovative sources such as levies, the new Fund for Loss and Damage would become either a “placebo fund” (it is empty) or a “siphon fund” (diverting resources from other climate funds). To avoid this, he proposed that Climate Solidarity Levies be introduced at the national and subnational levels. He cited France’s successful 2006 aviation levy, which funds global health initiatives through UNITAID, to show how targeted, earmarked levies can generate additional and predictable funding for a multilateral effort that is fair, not prohibitive, and does not affect demand for air travel. He surmised that
Müller emphasized that this approach could be replicated for the Fund for Responding to Loss and Damage, and cited existing examples of domestic Climate Solidarity Levies such as Fiji’s Environment & Climate Adaptation Levy used in part to replenish the domestic Climate Relocation of Communities Trust Fund. Müller advocated for the formation of a Climate Solidarity Alliance among like-minded countries, to show that the idea works and to persuade countries to join and act as first movers in providing international solidarity for responding to loss and damage.
Presentations were also made by:
- Laurence Tubiana, CEO, European Climate Foundation, and representing the Task Force, underscored that the goals of the Global Solidarity Levies Task Force are to determine which options are economically effective and politically feasible, and can be used to fund domestic and international loss and damage efforts; and
- Ali Mohamed, Kenya’s Special Climate Change Envoy, said changing the rules of global finance by reforming and democratizing the international financial architecture will also be needed as will ensuring that new financing mechanisms do not exacerbate the existing debt burdens of African countries.
The event identified next steps as: making the case for solidarity levies, launching a campaign to fill the Fund for Responding to Loss and Damage Fund; expanding the Global Solidarity Levies Task Force, particularly by engaging countries with significant emissions and financial resources; taking practical steps toward implementation, with the case of Denmark serving as a model; and finding solidarity levies champions and first movers to grow political will.
